Paul Matson: Nevada City will be back!
This is the second installment of a two-part series on the ways in which Nevada City will recover. It’s going to be a big challenge for state and local governments to regain their strength, balance and full-funding sources, once our world opens back up again. We don’t know when that will be.
I believe for California’s cities and towns to get back into full swing, it will be primarily up to the people who live in them, the all-important residents, aka, the voters.
Cities exist primarily to provide services to their residents, businesses, schools and institutions. In the case of our neighbors in Truckee, another compelling reason for incorporation was to gain control of their own destiny, rather than relying on the county for those decisions, as they had before incorporating. One huge benefit of being a full-service city is that they can chart their own course on development projects, and thereby define the character and future look-and-feel of their respective home towns.
The services that Nevada City provides are fire and police, water and sewer, parks and recreation (including a popular trail system), public works, planning and administration. Nevada City, weighing in at just over 3,000 residents, is one of California’s smallest full-service cities. It derives its ability to provide and pay for what is needed by having developed, over the course of many years, a vital business community which includes retail, service, government, visitor accommodation, office and professional, and light industrial. It is the headquarters of the Tahoe National Forest and Robinson Enterprises. It is highly significant that Nevada City is the Nevada County seat; home to the Eric Rood Government Center, the sheriff’s office and jail, and our court system.
If you add it all up during normal times, the city’s population doubles during the work week, which does not include the visitors that we welcome. Combined, these are the activities and establishments that pay for much of what we enjoy and need.
WE’RE ALL HURTING
Right now, like many of our friends across the country and around the world, we’re taking a huge financial hit in addition to the tragic sickness, death and sadness this COVID-19 crisis is causing. The losses to the city’s coffers also reflect a parallel amount of pain and loss to business owners, their suppliers and vendors, and their employees. It’s one great big hurtful event.
While we’re not alone in this boat, to follow here is a thumbnail sketch of what it all might mean for Nevada City government and its ability to provide service.
General Fund revenues will be seeing big losses. Today’s pre COVID-19 (approximate) annual revenues: sales tax – $1,046,000; room tax – $424,000; parking meters – $200,000 (at the new 50 cents per hour rate).
Sewer rates are based on water usage. With so many businesses closed and using no water at the moment, that income will drop as well.
Then there are some additional, special, endangered revenue sources. Measure S, a sales tax imitative, averages $550,000 per year at a half cent per $100. It sunsets in 2023, and has provided the millions of dollars needed to maintain and resurface every city street, as well as the money needed for sidewalks and walkways.
Measure C averages $425,000 per year at three-eighths cent per $100, improved our ISO Fire Suppression Rating, and has no sunset clause. It has allowed the city to hire three firefighters and one police officer.
In the context of a $4.8 million dollar annual budget, it all adds up to a lot of missing cash.
There are, thankfully, some mitigating revenue sources that will be largely intact such as property taxes which generate 35% of the city’s General Fund budget. Cannabis revenues are positive. And it’s possible that cities and counties may get some relief from the State and/or Federal Government. However, other than that and a few other minor money makers, it’s going to be slim pickings for a while, with no rapid recovery guaranteed.
Another issue which we will be reminded of all too soon is fire season with its accompanying power shut-offs and business stoppages. A needed countywide, vegetation management plan for better fire safety may be in the works shortly.
To pull things back together and maintain our ability to self-govern, plot our own course and responsibly provide services, something needs to happen and happen fast.
One avenue could be a new, temporary sales tax measure, placed on an upcoming ballot, to help make that possible, and pick up some slack from what was lost during this awful downturn. Incorporated cities tend to be the hub of business activity for their surrounding areas. Sales tax revenue is not only important, it is equitable.
The good people who are using city services while at work, play or shopping, help out greatly by paying their fair share. Sixty percent of the revenue raised by Measures S and C comes from nonresidents of the city.
We have a lot to offer here in Nevada County. We’ve got the scenic “backdrop,” 870,000 acres of Tahoe National Forest, four state parks, and three unique cities with all one could want in the way of shopping, dining, entertainment and services.
For my own part, I strongly believe it is imperative that our three cities remain independent, strong, and in charge their own destinies, directions and identities. That comes with the responsibility of taking care of business and responsibly doing the jobs at hand.
It won’t be easy, but together, with the resiliency of our business community combined with the solid support of our residents, we will be back!
Paul Matson, who lives in Nevada City, is a former Nevada City City Council member and current member of The Union Editorial Board. His opinion is his own and does not reflect the viewpoint of The Union or its editorial board. Write to him at EditBoard@TheUnion.com.
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