Tax set to sunset in 2023; if approved, user utility tax would be in place until repealed by voters
In addition to voting for city council and school board members as part of the upcoming November election, Cloverdale voters are being asked to vote on a local ballot measure that would extend the city’s user utility tax until repealed by voters.
The tax, last renewed in 2014 as Measure O, puts a 3% tax on telecommunication (including landline telephone and cell phone services), video (including cable television) and electricity and gas services within the city. The measure needs a simple majority (50.1%) to pass. The tax is currently set to expire in January 2023.
When Cloverdale’s user utility tax was first approved by voters, it was intended to fund an additional sworn officer for the Cloverdale Police Department. Since it was passed, it also helps fund an additional dispatcher for the department.
“At the time we referred to it as ‘the 10th officer’ which made the department have a total of 13 sworn officers. Measure O continues to support funding for that position. In addition, the funding from Measure O also funded adding a dispatcher to the dispatch division within the Cloverdale Police Department and that funding continues to support both of those positions,” City Manager David Kelley said.
City-produced information about the measure says that the approximately $445,000 per year that the tax will bring in will go toward repairing potholes and streets, installing backup power systems for the city, help the city prepare and respond to natural disasters and health emergencies, support youth and teen programs as well as maintain rapid 911 response. The main use of the revenue, however, will be to help pay for the two police department positions.
The money from the tax goes into the city’s General Fund, meaning the funds aren’t restricted for specific uses. If the tax is passed, the city is required to establish a three-member citizens’ oversight committee to review and report on receipt of the revenue and what it’s being spent on. The committee would be required to prepare and submit reports to the Cloverdale City Council as part of its budget process beginning in 2025-26.
In the past, user utility tax funds have helped pay for the four-way stop at North Washington Street and West Second Street, LED lights for downtown street lighting and the funds have helped go toward closing gaps in maintenance funds for park projects such as the resurfacing of the parking lot at City Park and redoing baseball facilities that are adjacent to the park, Kelley said.
Cities statewide are wrestling with the possibility of declining budgets. When asked how the city would balance budget woes while trying to make good on some of the tax uses listed in its Measure R flyers — namely backup power systems and street repairs, both of which often come with large price tags — Kelley said the funds from the tax could be used in collaboration with grant funds obtained by the city, since cities are often expected to contribute money to projects they may receive some grant funding for.
“We’re going to seek every avenue we can to help fund these (power) systems,” Kelley said, expressing a desire to find funding for backup power systems for city-owned buildings like city hall, the building occupied by the Cloverdale Senior Multipurpose Center and the building that houses the Cloverdale Regional Library. “What we’re finding is that by doing some of these measures, you’re going to reduce the long-term cost to the taxpayer,” he said.
No official argument in favor of the measure was submitted for the voter pamphlet. However, an argument against the measure was submitted by Daniel Drummond of the Sonoma County Taxpayers’ Association.
In the submitted statement, Drummond refers to Measure R as “a forever tax that never goes away,” and accuses the city of using a “sneaky strategy that exploits” voters who may not be familiar with the ballot measure process.
“Oh sure, your council members are telling you this tax remains only ‘until ended by voters.’ That seemingly benign phraseology belies the near impossibility of average citizens getting a repeal measure on the ballot. Unless you and an army of volunteers intend to spend a month camped out in front of the grocery store and post office collecting signatures or plan on hiring professional paid signature gatherers to get the necessary signatures,” the argument against the measure states.
When asked about the decision to not assign an end date to the tax, Kelley said that the decision was based on a few variables — having a more stable source of revenue for the positions the tax pays for, not having to pay the fees associated with going back to voters for a renewal and knowing that, should voters or the city end up disagreeing with the tax if the measure is approved, it could be repealed.
“If we lose this funding it puts those positions in jeopardy, so it’s really critical that this funding continues,” Kelley said. “What you do ideally is you generate another significant revenue source to help fund those positions going forward. With the challenge of the impact on the economy from the fires we’ve had and then COVID, it looks highly unlikely that we’re going to be able to generate enough additional revenue to fund those positions let alone fund the additional projects and activities, our community-based organizations and our critical infrastructure projects.”
Kelley said that while the language of the measure allows for the measure to be repealed by voters, the city could also decide to end the user utility tax.
“If the city council said, ‘Hey, we’re in such a great financial position, we want to relieve the taxpayers of this tax’ should it become extended, they have the right to do that,” Kelley said, noting that the city has decided in the past to halt the tax. A user utility tax that the city had was allowed to expire in 2006, and the city brought the tax back to residents for a vote in 2014.