Steinberg on sales tax increase: ‘One penny could change the economic arc of Sacramento’
Sacramento’s decision on Measure U is certainly about taxes and spending. But it’s also about trust.
Can voters count on city officials to use the proceeds on what they are promising? Will residents of struggling neighborhoods put their faith in City Hall after a history of broken promises?
We support this sales tax measure as a path toward a more prosperous and more just Sacramento, but we also insist that city officials rebuild confidence with taxpayers that they will deliver services more efficiently.
Measure U on the Nov. 6 ballot would renew the existing half-cent sales tax that restored fire, police, parks and other basic services that were slashed during the Great Recession. Approved by 64 percent of city voters in November 2012, it now brings in nearly $50 million a year. It automatically expires on March 31, 2019.
Starting next April 1, a renewed Measure U also would add a half cent to the sales tax, increasing the total in Sacramento to 8.75 percent.
Mayor Darrell Steinberg and other supporters say the additional money would boost affordable housing and homeless services, plus provide job training for teenagers and economic growth in poor neighborhoods – issues that surfaced following the police killing of Stephon Clark in March.
To keep Measure U a “general” tax that only requires a simple majority to pass – not two-thirds – any promises on how the money will be spent are not legally binding. The City Council would decide later exactly how the cash would be used.
By combining both the existing sales tax and the increase into one measure, supporters hope that the stronger backing for public safety will carry the additional tax across the finish line. Whether or not this is blackmailing voters, as critics say, supporters are taking a big gamble.
Without the existing half cent, the city could face painful budget cuts since it pays for 150 police officers and 90 firefighters. The local firefighters union, which bankrolled the original Measure U campaign in 2012, urged the council to stick with a half cent to make sure it would pass.
There is a safety net: If voters reject this measure on Nov. 6, the council would likely call a special election in March to just renew the current half cent sales tax and dip into a reserve account until it took effect. But Steinberg insists he is “all in” to get the full 1 cent approved.
We did not endorse the original Measure U in 2012. Before increasing taxes, we wanted the city to make more headway on controlling labor costs and making departments more efficient.
Since then, City Hall has made some significant strides. It has negotiated higher pension payments by workers and has reduced retiree health benefits. But there is much, much more to do. One obvious example, replacing one firefighter in city ambulances with a civilian paramedic, would save about $6 million a year.
Eye on Sacramento, a local watchdog group opposing Measure U, is putting together a list of savings it says will total $125 million, mostly by reducing labor expenses. It points out that the city’s pension costs are projected to increase by $62 million a year by 2022-23, so it argues that Measure U would basically all go to pensions.
Also, opponents note correctly that the original Measure U was sold as a temporary tax increase until the city’s finances recovered from the recession. According to one study, the average Sacramento household making $48,000 a year paid $1,485 in sales taxes in 2015. If this measure passes, that bill would go up to $1,575 a year.
And as critics point out, a sales tax hits lower income families the hardest and Sacramento residents have recently been slammed by a series of utility fee hikes. By 2020, the average homeowner will be paying at least $800 more a year than in 2012.
That’s a lot of pocketbook politics to overcome.
To do so, city officials must commit to act on cost-saving measures that have been put on the back burner for too long. That not only will boost the chances of Measure U passing, it also will make it more likely that the additional revenue will actually go to housing, neighborhoods and all the other programs frequently cited by Steinberg.
Transparency and accountability matter here.
So it’s welcome that the mayor is proposing a more robust and more involved citizens oversight committee than the one for the existing Measure U.
The new panel would review and recommend potential investments based on metrics, such as how many jobs they would create, how much they would reduce unemployment and how much economic growth they would spark. Then, the committee would help measure whether these investments have worked. The oversight committee would include national experts as well as local members; the council must make sure it is also representative of neighborhoods that are supposed to benefit.
This and other proposals will help build public trust. To persuade voters to pass Measure U, they are essential.
Yes on Measure K
The City Council also placed a second measure on the Nov. 6 ballot. Measure K would establish the council-appointed city auditor as an officer under the city charter, which means the position could only be eliminated by voters. It also would consolidate the independent budget analyst’s duties in the auditor’s office.
The current city auditor, Jorge Oseguera, has been a good watchdog. The bigger issue is that the council doesn’t follow his recommendations enough.
Measure K would also give the council more flexibility on when it holds meetings. It is supported by the League of Women Voters of Sacramento and California Common Cause. It is an easy “yes” vote.