The Half Moon Bay City Council voted 4-1 Tuesday night to present a half-cent sales tax increase on the November ballot. City leaders say the measure would provide an estimated $867,000 annually for three years and is necessary to fund infrastructure improvements not currently covered in the operational budget.
The sales tax would bring the sales tax rate in the city to 8.75 percent and would go into effect shortly after the vote, though the first payment wouldn’t come until July 2013. The measure requires only a simple majority to pass.
The city has struggled to make ends meet for several years. An $18 million court judgment over the Beachwood land dispute nearly sent the city into bankruptcy. Since then a nationwide recession has hurt tax receipts. The city has responded by cutting many positions in city hall and contracting police, planning, parks and other municipal services.
Now city leaders say they have turned a financial corner, but they still need about $1 million a year to cover several big-ticket infrastructure projects, notably replacement of the crumbling Main Street bridge. The sales tax revenue could be used for that purpose. The official ballot language also mentions the need to boost tourism, improve parks and other popular city programs, though the city would have wide discretion over how to ultimately spend the tax money.
City Councilwoman Marina Fraser was alone in opposing the tax measure.
“I’m not sure this is the right time, for me personally, for this ballot measure,” she said. “I haven’t had anyone in the community come up to me and say, ‘Yeah, this is the time.’”
In 2010, Fraser was one of the most ardent supporter of an even bigger tax initiative known as Measure K. That ballot measure failed by about 200 votes and the loss clearly still stings.
“Two years ago I was all in on this,” Fraser said. “We were going to lose our police department, we were breaking up our rec department … we begged people to vote for this and we lost.
“I just don’t think we’re at the end of our rope like we were two years ago,” she said.
But for a majority on the council, concern about funding capital projects carried the day.
“If that Main Street bridge goes out you don’t have to worry about a sales tax or staying in business,” said City Councilwoman Naomi Patridge. She said the city simply had no choice but to raise revenues, noting it had no money for any infrastructure work after next year.
City Councilman Rick Kowalczyk said it was up to the council to prove the need for the tax to voters.
“We are not going to have 5,000 people come in here and say, ‘Damn it, Kowalczyk, give me a higher sales tax.’ We were elected to lead.”
There was only a small handful of people in the Ted Adcock Community / Senior Center when the vote was taken. Several local business owners spoke in support of the tax measure. It’s Italia restaurant co-owner Betsy del Fiero was typical.
“It’s a minimal amount, it’s a relatively unnoticeable amount and I feel that the effects will be far-reaching in our community,” she said.
Patti Warshauer, owner of Main Street Goldworks was the only speaker to oppose the plan. She noted empty storefronts on Main Street as evidence that businesses couldn’t afford to charge customers any more.
Some of those who spoke in favor of the tax at the meeting were circumspect.
“I don’t like taxes, however I do like government services and I do understand that they cost money,” city resident Les Deman said, adding his support would be contingent on knowing the tax was for capital improvements and infrastructure and not operational expenses.
The measure will be decided on the Nov. 6 ballot.