Grass Valley, Nevada City tax measures on local ballots
With prolonged plunges in local municipal budgets since the economic decline, Nevada City, followed by Grass Valley, moved to put increased sales taxes before voters on the November ballot.
“If something doesn’t happen, we’re looking at potentially reducing more police staffing,” said Nevada City’s city manager, David Brennan.
Nevada City has lost $487,000 from fiscal year 2008-09 levels, resulting in reduced services from police and public works, among myriad other reductions.
To counteract this decline and fund delayed expenditures, city administrators have placed a three-eighths of a percent sales tax increase, called Measure L, on the ballot,
Facing similar declines, Grass Valley placed a similar, half-percent sales tax on the ballot as well. Measure N would raise the sales tax rate to 7.875 percent — Nevada City’s current rate.
The measures would add revenue to both cities’ general funds, where city administrators, under the policy guidance of elected officials, would dole out the funds to specific programs and expenses.
Measure L would add $390,000 annually to Nevada City’s general fund, and Measure N would bring an estimated $2.4 million to Grass Valley.
Directing the taxes to the general fund, as opposed to a specific purpose, avoids the qualification as a “special tax,” which requires two-thirds voter approval, like the one to fund firefighting in south Nevada County earlier this year.
Grass Valley and Nevada City’s measures differ in their durations and accounting methods.
Nevada City’s Measure L has a five-year sunset clause, while Grass Valley’s Measure N would expire in 10 years if voters don’t approve an extension.
Both cities argue that the funds would mostly go to public safety and public works, offering different degrees of monitored accounting to follow how the money is allocated.
Grass Valley administrators have also outlined plans to eliminate the tax if revenues return to pre-recession levels. Expenditures of the funds from the tax would be approved by the City Council, audited by an independent accounting firm and reviewed by an independent oversight committee, said Grass Valley City Manager Dan Holler.
“It provides accountability,” Holler said. “It adds credibility to the project.”
The oversight committee will also advise the council on future expenditures, but the council is not bound by that advice, Holler said.
“Council can override a recommendation, but the problem with that would be public perception,” Holler said.
Funds from Nevada City’s tax measure will be tracked and presented annually in a public meeting.
“It will be treated as a special revenue account with all expenditures identifiable. It will all be clearly approved by the council, which will be listening to the public,” Brennan said. “The council absolutely wants to hear from the community.”
Sitting in his office, Brennan pointed to leak stains in the ceiling as evidence of deferred maintenance costs at city hall. The city has deferred basic upkeep on other roofs, such as Seaman’s Lodge at Pioneer Park, which haven’t had funding for years.
Nevada City wasn’t the only community hurt when the housing bubble burst.
Property tax revenue in Grass Valley has taken a nearly $150,000 dip since a 10-year high in fiscal year 2009-10, when the city received nearly $2.32 million.
However, the currently estimated $2.17 million in property tax revenue is more than $880,000 more than it was from that same source a decade ago.
Similarly, when auto dealerships left town, sales tax revenues fell more than $921,000 since the 10-year high in fiscal year 2006-07, when the city raked in nearly $5.36 million.
The currently estimated nearly $4.44 million in sales tax revenue is more than $925,000 more than it was from that source a decade ago.
Consequently, the city’s currently estimated nearly $10.1 million general fund is more than $2.32 million higher than it was a decade ago but more than $1.5 million lower from its fiscal year 2007-08 peak at nearly $11.56 million.
Most telling, though, are the expenditures.
For instance, during fiscal year 2007-08, when the economy took a nose dive, Grass Valley’s budgeted expenditures at the beginning of the year were $1.33 million more than the actual revenue. Approximately 70 percent of that difference was due to an operational shortfall, according to Holler.
Since then, the city has cut $2.5 million from its general fund budget and reduced the equivalent of 39 full-time city employees, including nine police staff and 2.5 firefighters, Holler said.
Nevada City is down to nine police staff, Brennan said, with one poised to be reduced as the city continues the battle to keep its finances within its means.
The city’s top four department heads — Brennan, the police chief, city attorney and city engineer — have all been reduced to part-time positions staffed by retirees able to subsist on supplemental income from pension packages.
The city has also continued three years of furloughs with the city offices closed on Fridays.
“It’s not good for an organization when the public expects the same service with five percent less time,” Brennan said. “It’s a disservice to the public.”
Among more recent cost reductions, Grass Valley and Nevada City have outsourced their police dispatch services to the Nevada County Sheriff’s Office, a move estimated to save the towns $163,000 and $20,000, respectively, in the first year alone.
Truckee also outsourced to the sheriff’s Nevada City dispatch center.
Since 2007, Grass Valley’s police staff has declined from 31 officers to 20 officers, who responded to an annual average of 29,000 calls for service in 2011, according to figures provided by the department.
Compared to the sheriff’s office, for which 54 sworn officers responded to 32,500 calls, GVPD Chief John Foster said his folks are providing comparable response with less staff.
But it can’t last forever. The staffing shortage will lead to reductions in services, the department announced Wednesday.
“Our responsibility to calls for service is going to change,” said Foster, who personally attended to 196 calls in 2011 and is poised to surpass that number this year.
Residents seeking service — on incidents such as petty thefts and shoplifting involving suspects who cannot be positively identified, present false identification or are uncooperative — should expect a limited response by officers, said Capt. Rex Marks in a press release.
“We’re very challenged meeting the quality-of-life issues the citizens expect us to meet,” Foster said. “Right now, we are reactive, not proactive.”
Other low-priority incidents that will receive limited responses include animal control issues, parking complaints and civil issues, such as custody exchanges and property removals.
“If someone is available, we’ll send them. But it might not be in a timely fashion,” Foster said, talking about allocating officers during in-progress emergency incidents.
Requests for police services involving property damage, vandalism, vehicle tampering, hit-and-run accidents, custody order violations, harassing phone calls, lost property and thefts not in progress or where the suspect is unknown will no longer receive officer response but instead will be reported through the department’s website,
If passed, Measure N would fund five police officers, four firefighters and two fire engines and provide an estimated $7 million to fix 50 miles of city streets over 10 years, 50 percent of which are in need of road repair.
Both cities estimated that more than 60 percent of their respective taxes would be paid for by out-of-towners, officials said.
Whatever the cost, administrators said that without the tax, more city services will be cut.
To contact Staff Writer Christopher Rosacker, email firstname.lastname@example.org or call (530) 477-4236.
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