10C Action 2008 0721 - Laserfiche WebLink

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Ballot Measure Overview Report 2 July 21, 2008 November election calendar deadlines; due to the Council meeting calendar, a decision to proceed would need to occur by the last meeting in July. Below are the concepts for consideration: Utility Users Tax (UUT) -Overview • Updates certain elements of the ordinance and addresses legal concerns; • Reduces the UUT rate for telecommunications (Telephone Users and Video Users) from 6% to 5.7%; • The UUT was originally adopted in 1972. In 1987, the tax rate was increased by 1 % to a rate of 6% on telephone, electrical, gas and video (cable TV) service. It has been amended several times, the most recent update taking place in 2004; • Revenues currently generated by the UUT on an annual basis total approximately $4.0 million from the Telephone Users and Video Users Tax; without the UUT modernization, $3 million is "at risk"; • If approved, the reduction will allow the Telecommunication UUT to remain revenue neutral, while also including some technologies which are currently not included in the ordinance. This would also ensure that telecommunication technologies, as they develop, will continue to be fairly taxed into the future. 911 Fee -Overview • Clarifies the ordinance to voters for purposes of language and use, changing the language to establish it as a "special tax"; • If the proposed change to the ordinance does not pass (by 2/3 votes), the existing fee ordinance would still remain in effect and collection would continue pending recent litigation; • If approved, it becomes "revenue neutral" -meaning that no new revenue would be generated. However, should it pass, the City's revenue from this source would continue in the future; • Updates the ordinance to recognize and tax equitably all forms of telecommunications that access the City's 911 system; • The ordinance currently generates $2.5 million annually. This amount is "at risk" pending the outcome of on-going litigation. Police Services Parcel Tax -Overview • The Police Department has identified both ongoing and new programs (e.g., additional officers for patrol, schools and crime prevention) that the parcel tax revenue would support; • Uses of this new revenue source would be linked to the Police Department Strategic Plan; • If approved by the voters, the fax would not be collected until the following year commencing with the 2009-2010 fiscal year; • It is suggested the parcel tax have a four (4) year sunset clause; • Passage of this parcel tax would provide revenue to aid in the lower economic downturn that the City is currently experiencing and anticipating to continue over the next two years in order to sustain the current level of service to the community; • It is estimated the parcel tax would generate approximately $2.6 million in revenue for police services. Due to the sunset clause, the estimated revenue would be applied to continue the existing service levels and may only provide some nominal enhancements should other revenue sources increase.