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• Minutes - San Leandro City Council Meeting - June 7, 1993 Page - 12 - PUBLIC HEARINGS (continued) Vice Mayor Polvorosa asked for the City Council and the audience to take a moment to recognize the individuals who had been nominated earlier to serve on the City's Boards and Commissions. B. Matter of Utility User Tax. This being the time and place for the Public Hearing on the above matter, John Jermanis, Finance Director, said the Public Hearing was on one element of the Budget Strategies for 1993-94. He said the budget does not include raising the Utility Tax. He said, if the Ordinance was passed, it would be a contingency measure, only to be used if the State takes $1 .5 million. He said the budget provides for $1.2 million in reductions. He said the Task Force recommended that the Utility Tax was one that could be raised for funds to continue existing services. He said the budget can be balanced without this, provided the State reduction is not more than $1 .2 million. Mr. Jermanis reviewed some of the actions the State Legislature is considering and how they would affect San Leandro, if enacted. He said the budget includes $1 .8 million in reductions. He said the State could take from $1 .2 to $2.5 million. He said $2.5 million represents most of the AB 8 monies. He said San Leandro lost $1 million last year, and the remaining AB 8 shift equals $2.5 million. He said the Legislature initially planned to take this money over a three-year period, but it may now be necessary for them to take a greater amount earlier. He said the Governor has set a new level of $288 million, applied to cities only. This would be $800,000 for San Leandro. He said the Legislature is looking at alternatives, such as motor vehicle fees, which would mean an $850,000 loss. He said a sales tax shift would mean a $1 .640 million loss because San Leandro has a high per capita sales tax. He said these alternates are being proposed by cities that find them more advantageous, such as Los Angeles. He said many scenarios are possible, and the City needs to maintain this contingency plan. If the State adopts its budget with greater than $1 .5 million in cuts for San Leandro, the utility tax increase would be implemented. He said it would also be implemented if Sales Tax for the City drops by more than $1 million. He said, if the utility tax is not approved, the City would have to utilize reserves or go back to other alternatives, such as cuts in services recommended by the Task Force. He said these include reduction of Fire Department apparatus-replacement reserves, closing two branch libraries, eliminating sworn police officers, turning off certain street lights, closing swimming pools, and abandoning after- school recreation programs. He said these reductions were felt to be too severe but would raise $1 million. He said the increase in the utility tax will save these programs.