Elections, Local Tax Elections, Local Taxes

Santa Cruz Seeks to Convert General Tax Into Special Tax Without Two-Thirds Vote

Santa Cruz

A local measure on the November 2 ballot in Santa Cruz seeks to convert an existing general tax into a special tax – with 20 percent of the revenue earmarked for special purposes – with a simple majority vote rather than the two-thirds vote required for special taxes.

Measure A would amend the Measure L tax on marijuana businesses – approved in 2014 with 82 percent of the voters in support – to allocate 20 percent of the revenue to the Santa Cruz Children’s Fund for youth and early childhood development programs and services.

If Measure A is approved, city revenue for the Children’s Fund will increase from approximately $212,000 to $340,000 per year, according to city projections.

The measure was placed on the ballot by the Santa Cruz City Council. The City Council also wrote the ballot question, which asks: “To solidify the City of Santa Cruz’s commitment to prioritizing funding for children and youth programs and services, shall the Santa Cruz City Charter be amended to allocate 20 percent of revenue generated by the Cannabis Business Tax to youth and early childhood development programs and services?”

The ballot question for the 2014 tax described several specific services that potentially could receive funds, despite being a general tax that could be used entirely for other purposes if the City Council decided to do so. The question asked: “To protect the quality of life in the City of Santa Cruz and to fund essential city services such as police, fire, emergency response, youth and senior programs, job creation, housing, and environmental protection, shall an ordinance be adopted to impose a tax of no more than 10 percent (7 percent when enacted) on gross receipts of cannabis (marijuana) businesses in the city, subject to audits, with all funds staying local?”

The Santa Cruz measure is one of 15 local tax measures on the November 2 ballot. If all are approved, there will be a cumulative $53 million tax increase on Californians.

Despite the state law banning use of public resources to promote or oppose ballot measures, some counties have been using tax dollars to encourage support for their measures.

In the Los Gatos Union School District, voters face Measure B, which would extend and increase an existing $290 parcel tax (the tax would increase $45 per parcel initially, followed by annual increases of 2 percent). The school district’s website includes a one-sided description that claims without this increased funding, the district “would face $2.7 million in cuts, or the equivalent of losing 15 percent of the teaching staff in LGUSD schools.” The website does not discuss how a property tax with automatic annual increases would affect the cost of housing or overall cost of living in the district.

Additionally, the district produced a school funding video that promotes a “yes” vote by presenting a slanted view of Proposition 13 – the property tax reform initiative of 1978 – and offering various statistics intended to support the claim that the district needs increased funding. “Our schools are at a crossroads …,” the video states. “Working together, we can make a difference for our schools and our town.” While the video cites state funding for schools, it does not inform viewers that there have been major increases in per-pupil funding in recent years.

Also in Santa Clara County, the Berryessa Union School District is using public resources to advocate for Measure B, which would extend an expiring $79 parcel tax for eight years. In a video posted on district’s website, the superintendent encourages voters to “renew expiring school funding without increasing taxes.”

The video states that renewing the existing parcel tax measure “may maintain core academic programs in science, technology, reading, writing, languages, and math, attract and retain quality teachers, provide learning technology, retain school counselors and library/media technicians, and keep school libraries open.” The video uses upbeat background music and a green color scheme to emphasize a “yes” message, and includes numerous campaign-style images that appear to have been taken at school sites this year, with teachers and students wearing face-covering masks.

In Brawley (Imperial County), voters will decide the fate of Measure U, which would extend an expiring utility users tax in perpetuity at a rate of 4 percent on telecommunications services, natural gas, water, sewer, and solid waste, costing taxpayers an estimated $2.5 million annually.

Brawley’s webpage on the measure discusses why local residents support the measure. The page also describes the claimed impact if the tax is not renewed: “Losing UUT revenue would immediately place many of Brawley’s services at risk. The parks and city facilities, graffiti abatement, all recreation and community services and programming including the senior center, library and community events will be reduced or eliminated. There will be reductions in service, increased response times, and elimination of positions in all City departments including in the Police and Fire departments.”

The ballot question for the Brawley tax asks if the city should “adopt an ordinance extending the Utility Users’ Tax until otherwise repealed by voters at a rate of 4 percent, which is less than surrounding municipalities.”

Details on upcoming elections and results of this year’s previous elections are available on CalTax’s local elections page.