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File Number: 16-453 <br />Analysis <br />Amounts of Transaction and Use Tax revenue generated by Measure HH <br />The adopted Budget approved on June 1, 2015 anticipated $10.3 million in Measure HH <br />revenue for FY 2015-16. The City was allocated its Measure HH sales tax starting April 1, <br />2015 but did not budget a full year of receipts until FY 2015-16. The first receipts were <br />received in fall 2015. <br />Use of the tax revenue and the impact on the City operating budget including a <br />statement on the impact of the revenue in reducing the amount of cuts resulting from <br />addressing the budget shortfall <br />Measure HH revenue is available to the City for any legal expenditure. In the context of public <br />safety, the annual revenue represents about 33% of the police department’s FY 2016-17 <br />budget, which is $32.7 million, and 44% of the fire department budget, which is $24.4 million. <br />Without Measure HH in FY 2016-17, sworn police officers (currently 93) could be cut by as <br />much as 29 positions (if $10.3 million was removed from the police department budget). <br />Similarly, the fire department’s 63 firefighters could be down 27 positions (if all $10.3 million <br />was eliminated from its budget). Measure HH also indicated that it would sustain 9-1-1 <br />emergency response times, neighborhood police patrols, investigation and gang suppression <br />officers, library hours/programs, street and pothole repairs, youth after-school and senior <br />programs, and other general City services. The City preserves funding for these programs <br />and projects through Measure HH. <br />Statement of expenditures funded by Measure HH <br />The pie chart, Attachment 1, indicates that a total of 58% will be spent on public safety in FY <br />2016-17. The remaining 42% will fund libraries, parks, community development, infrastructure <br />improvements, repairs, maintenance and administration. The abbreviations used in the pie <br />chart are Rec (Recreation and Human Services Department), Gen Govt (General Government <br />- City Attorney, City Clerk, City Council, Human Resources, Finance and City Manager), Com <br />Dev (Community Development Department), and Engineering (Engineering and <br />Transportation). Non-dept. (non-departmental) costs are General Fund debt service, retiree <br />medical, community investment and events, and leases. The City’s FY 2016-17 budget, which <br />ends on June 30, is currently balanced. <br />Impacts of Measure HH on local business competitiveness and the collection of Sales <br />Tax revenues <br />Sales tax revenue increases have occurred at a rate greater than the average rate for other <br />cities in Alameda County since the inception of the Measure Z quarter cent sales tax. Three <br />other cities in Alameda County have a 10% rate: Albany, Hayward and Union City. The <br />impact of Measure HH cannot be determined until sales tax receipts are measured in FY <br />2015-16 and FY 16-17. General sales tax increased 16% in 15-16, suggesting that Measure <br />HH had little effect. Sales tax in other Alameda County cities and statewide were substantially <br />less than San Leandro sales tax in FY 15-16. <br />Page 3 City of San Leandro Printed on 9/27/2016