10B Action 2010 0719 - Laserfiche WebLink

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Temporary Sales Tax Measure, November 2010 2 July 19, 2010 considered for revenue enhancements included a parcel tax, development of landscape and lighting districts, and increased sales tax. Based on the desired ability to provide general municipal services, enhancement to the sales tax was the most feasible of the options. In addition to the questions related to increasing revenue, the poll included questions related to the desired longevity of a potential measure; the results showed strongest support for a temporary measure, with a sunset period of seven years. The next phase of public input included the appointment of a Citizen's Budget Task Force in October 2009. As part of the pending budget development process, the committee helped to identify priorities for City services. The final component of community input was launched in winter 2010 with a Community Feedback Survey mailed to residents. The survey was also placed on the City's website. Staff attended over 25 community meetings to inform the community about the fiscal crisis and obtain input by providing the feedback survey at those meetings. To date, over 1000 surveys were submitted from the community; the feedback strongly supported the results of the poll that had been conducted in August. These results were considered when staff developed the 2010 -11 budget for consideration by the City Council. DISCUSSION The recommendation is to place a quarter cent transactions and use (sales) tax, with a seven year sunset, on the November 2010 ballot. Below is the concept for consideration: Temporary Sales Tax Measure — Overview • Tax would be imposed on retail transactions involving purchase and use of personal property (sales); • Tax rate would be one - quarter of one percent (0.25 %), of the sales price of the transaction; • Tax would be imposed for seven years and expire automatically unless extended by the voters; • Tax is collected by the State Board of Equalization and remitted to the City; • Estimated to provide approximately $4 million annually for the duration of seven years; • The revenue would be would be used to support general municipal services; • Revenue legally required to stay in San Leandro for local services and cannot be taken by the State; • A Citizens Advisory Committee would be established to provide oversight; • Tax measure shall be approved if the affirmative votes are at least a simple majority. Sample Ballot Question Language The following is the proposed ballot language to be used in the upcoming election, should the Council decide to place the measure on the November 2, 2010 ballot. It has been approved by the City Attorney and meets the specific legal and technical requirements of the proposed sales tax measure. We therefore recommend that no changes be made to the proposed ballot language. The Council may authorize the Mayor or a subcommittee of two councilmembers to file an argument in favor of the measure and a rebuttal to an argument filed against it, and to work with an independent campaign committee on the preparation of the argument and rebuttal.