Sentinel staff report–
The Citrus Heights City Council on Thursday will vote on whether to place a local sales tax measure on the November ballot to address budget shortfalls and bring in an estimated $12 million in additional tax revenue per year.
If passed, the measure would raise the current sales tax by 1 cent, with the sales tax rate increasing to 8.75% in Citrus Heights, up from the current 7.75%. The measure would also create a Citizens’ Oversight Committee made up of five Citrus Heights residents to monitor expenditures.
The new $12 million in tax revenue would represent a significant increase in the city’s current General Fund revenues of around $33 million. The funding would also be locally controlled, rather than coming in the form of state or federal grants with strings attached.
City Manager Chris Boyd said in a staff report to the council that the measure will enable the city to “remain self-reliant and preserve and provide the services our community prioritizes, expects, and deserves.” Highlighting the aspect of local control, he also said the tax would “provide funding that cannot be taken by the State of California, with funding to be used only for local City services.”
Boyd referenced results from the city’s recent “community priorities” survey as a key basis for seeking additional funding. The proposed ballot language would ask voters:
“To protect local control with funding that cannot be taken by the State; maintain 911 emergency response times; crime investigation/prevention; well-trained community police officers; school safety/security; pothole/street repair; homelessness reduction programs; local business/jobs support; and other city services, shall a measure to establish a Citrus Heights 1¢ sales tax generating $12,000,000 annually until ended by voters be adopted, with independent annual audits and citizen oversight, and all funds spent in Citrus Heights?”
The City of Citrus Heights, along with municipalities across the country have grappled with budget shortfalls due to sales tax revenue reductions and increased emergency spending to respond to COVID-19. The City of South Lake Tahoe last week voted to approve a similar 1-cent sales tax for the November ballot, noting a $6 million shortfall, while the City of Hayward and the State of California have pushed for pay cuts and furloughs to cut costs.
Related: $8B tax measure to fund roads, transit won’t go on Nov ballot
Other tax measures have been pulled from the November ballot, in light of current economic uncertainty, including a countywide half-cent sales tax measure that would have provided funding for roads and transit projects in Sacramento County. The Sacramento Transportation Authority (STA) board voted last week to pull the tax measure, following polling showing it would fail given the current economic and political climate.
Citrus Heights Vice Mayor Steve Miller, who sits on the STA board, earlier predicted the transportation measure would “go down in flames” if it had been placed on the ballot, saying “it’s not the time.”
Asked whether polling had been conducted for a Citrus Heights tax measure, City Spokeswoman Nichole Baxter declined to provide details on Saturday, but said “lots of information regarding the polling, methodology, recommended use, etc.” will be presented during the upcoming July 23 council meeting.
A prior local tax proposal to fund police and road maintenance in 2012, Measure K, was shot down by voters in Citrus Heights with 56% voting against the tax measure.
Related: 10-year budget forecast for Citrus Heights looks grim
Budgetary woes in Citrus Heights preceded the coronavirus coming on scene. According to a presentation last month, the city’s budget is projected to have shortfalls during eight of the next 10 years, even with an added boost of $5-6 million coming in 2022 when the city begins receiving its long-awaited share of property taxes.
The city’s General Fund budget saw a $1 million shortfall in sales tax last year and is projected to have a $3.4 million revenue shortfall for the current fiscal year. A temporary savings of $1 million per year has been implemented through a hiring freeze, leaving about two-dozen staff positions unfilled.
Councilman Bret Daniels and some other residents have criticized the city for spending much of its General Fund reserves on a $21 million City Hall, leaving little for a “rainy day.” General fund reserves are currently around $5 million, but are projected to quickly dwindle.
The July 23 council meeting will be held online via Zoom, with members of the public able to comment by using the “hand raise” function or dialing *9 if joining by telephone. Written comments up to 250 words can also be submitted by email to cityclerk@citrusheights.net and will be read aloud during the meeting.
To join the public Zoom meeting, use the following link (click here), or see link posted in the council’s agenda packet.
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