Council to explore three possible tax measures

Daily Post Staff Writer

Despite soaring revenues and a hefty surplus, Mountain View City Council unanimously decided last night to explore three possible tax measures for November: a marijuana tax, an increased hotel tax and a higher business tax.

Councilman John McAlister, who also serves on the board of VTA, cited the need for a source of funds for transportation projects, like the 4- to 6-mile automated guideway transit system that city leaders have recently begun discussing.

The automated guideway transit system would cost between $50 million and $130 million per mile.

Several residents, including Environmental Sustainability Task Force member Cliff Chambers, attended the meeting to voice support for funding public transportation development as the city population balloons, with thousands of apartments planned for the North Bayshore area and elsewhere.

“I think Mountain View needs to have a sustainable stream of revenue to provide for the citizens of Mountain View: to help them get around, to reduce traffic congestion, to reduce greenhouse gases,” McAlister said.

But the city may decide to send any of the taxes to the ballot as general revenue measures. The money would flow into the city’s general fund, where it could be used for any purpose.

General revenue measures only require a majority vote, while a tax earmarked for a specific purpose like transportation requires two-thirds.

Surplus cited

Former Mayor John Inks told council to exercise caution in pursuing the measures, citing the city’s budget surplus in the budget year ending June 30.
He also raised doubts about going to voters to fund the automated guideway transit system at such an early stage of planning.

“I question raising revenue on something like that because, basically, it’s a big question mark at this point,” Inks said. “I’m not against automated guideway transit, but you want to spend your money and your time effectively.”

The city’s certified annual financial report, or CAFR, shows $258.6 million in revenues for the budget year ending June 30, an increase of $51.3 million or 24.8% over the prior fiscal year.

The auditors who put together the CAFR said the city’s surplus was due to “significant increases for developer contribution fees and charges for services related to a high level of development activity.”

The CAFR went on to say that rising property taxes had also boosted city revenue as property values remained strong. The median price of homes had risen while home sales and new development added to the tax roll.

The city’s balances on June 30 were $454.1 million, according to the CAFR. Some 12.5% of that, or $57 million, was listed as unassigned, making it available to meet the city’s current and future needs.

Business tax increase

A memo from City Manager Dan Rich said the business tax could generate about $854,000 annually. Most businesses currently pay $34 a year, raising $250,000 for the city.
Council would need to approve sending the measures to the ballot by the June 26 meeting in time for the measures to be finalized by Aug. 9, the deadline for the November ballot.

In approving last night’s motion, council allocated $72,000 to hire part-time help to research the measures and administer a preliminary voter poll to gauge interest in the measures.

McAlister, Mayor Lenny Siegel and Councilman Chris Clark were also unanimously appointed to serve on a subcommittee to advise Rich on the project.