Friday, August 18, 2017

[Sonoma County] Grand Jury: Coordinate on sales tax measures

As Sonoma County and other jurisdictions including Petaluma consider asking voters to raise sales taxes to shore up lean budgets, officials worry that voters may be inundated with a cornucopia of ballot measures and decide to cast a blanket “no” vote on all of them.
Additionally, as the county nears a state sales tax cap, observers have encouraged jurisdictions to increase coordination to both avoid voter fatigue and maximize what little room is left for raising revenue for unfunded priorities such as road paving, park construction and pension liabilities.
The Sonoma County Civil Grand Jury, in a recent report, urged the county, cities and other governmental bodies with taxing authority to communicate their plans to avoid having three or more tax measures on the same ballot.
The problem is more acute at the county level, where the board of supervisors is hamstrung by a sales tax cap of 2 percent above the state level of 7.25 percent. Sales tax in the city of Cotati is 9.125 percent, meaning that if the board of supervisors wishes to raise sales taxes countywide, there is only .125 percent, or one eighth-cent of room to increase the tax before the cap is reached.
Such a tax increase would raise about $10 million per year for the county, well short of the $150 million per year in new revenue that the board of supervisors needs to fund its priorities, according to the grand jury report.
Petaluma with a sales tax of 8.125, is among the lowest in the county. City officials have unsuccessfully tried several times in recent years to increase the sales tax, but are not considering asking voters for an increase in the near future.
“No countywide sales taxes may be proposed once any jurisdiction in the county reaches the 2 percent cap,” the grand jury report says. “That does not preclude individual cities from submitting additional local sales taxes to their voters, but it does preclude the board of supervisors or any other entity from proposing countywide sales tax measures. That makes Cotati, with a 1.875 percent local sales tax rate, the tail that wags the dog.”
The report says that the board of supervisors should “develop a formal process to work with cities, independent special districts and joint powers authorities to coordinate future sales tax measures to ensure sales tax revenues are maximized across all jurisdictions.”
It also recommends asking a state legislator to introduce a bill that would waive the state sales tax cap, a rare procedure that has been used in three other counties in the state.
The county could propose two sales tax measures on the ballot in 2018. A sales tax dedicated to Sonoma County Regional Parks, which was narrowly defeated at the ballot last year, could be back before voters. Also, transportation officials are looking to extend Measure M, a quarter-cent sales tax for road maintenance, and are thinking about increasing that tax to a half-cent.
Supervisor David Rabbitt agreed with the grand jury and said that the county should coordinate with other jurisdictions.
“Everything we’ve done at the county, we’ve tried to let other jurisdictions know,” he said. “I believe we need to coordinate and not look at things in a vacuum.”
Petaluma last asked voters to increase the sales tax in 2014 with Measure Q, which was defeated. An early attempt last year to raise the sales tax never made it to the ballot after polling showed it did not have the support to pass.
August 16, 2017
Petaluma Argus-Courier
By Matt Brown


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