The ink was barely dry on the Davis City Council’s proposed Measure O, the tax ordinance, when Mr. Dunning began to attack the language as “strange and deceptive.”
He writes that the language states: “Shall Ordinance No. 2432, which would authorize the city of Davis to continue to collect a sales and use tax for general government purposes at the total rate of 1 percent through Dec. 31, 2020, be adopted?”
Given space limitations, the city probably cannot explain that what they are really doing is combining the current half-cent sales tax with a new half-cent sales tax and extending both until 2020.
Mr. Dunning argues that the use of the word “continue” might suggest to voters that a “yes” “vote will merely sustain the status quo by extending a tax that is already in effect.”
He notes, “No mention anywhere of the half-cent increase we’re being asked to approve. Also no mention that the current half-cent sales tax is set to expire in 2016.”
Mr. Dunning immediately jumps into nefarious assumptions as opposed to sloppy or legalistic explanations. He writes, “Why the council didn’t simply state those facts in plain, simple English is unclear. Maybe they think we’re stupid. Maybe they think we aren’t paying attention. Or maybe they hope they can slip this one past the censors with no one raising a red flag.”
He writes, “Apparently, enough of us complained about this abuse of the language that the council has been sent back to the drawing board after having been taken behind the woodshed by an angry electorate.”
He continues that the council will “consider amending the language of the ballot question for Measure O,” according to a staff report.” However, he quickly adds, “Unfortunately, there’s no guarantee the council will do anything at all about its sleight-of-hand tactics. Staff has given the council three options if it chooses to make things right with the voters. Sadly, only one of those three options — Option No. 2 — fully and accurately describes exactly what we’re being asked to approve come June 3.”
States Option No. 2: “Shall Ordinance No. 2432, which would authorize the city of Davis to extend the existing half-cent sales and use tax for general government purposes and increase the sales and use tax by an additional half-cent, through Dec. 31, 2020, be adopted?”
Mr. Dunning argues, “Only Option 2 is honest about the fact we currently have a half-cent sales tax that must be extended or it will expire all on its own. Only Option 2 lays it out straight for the voters. It’s anyone’s guess what the council will do — if anything — but as we all learned in kindergarten, honesty is the best policy.”
Why Mr. Dunning believes this is anything other than an inadvertent error is puzzling. In their own argument in favor of Measure O that the voters will get, it states, “Measure O proposes to increase our community’s sales tax to 8.5 percent until 2020. This represents a one-half cent increase now, and will continue until 2020 an existing one-half cent tax due to expire in 2016.”
I get Mr. Dunning’s likely response that many people do not read the ballot arguments – but this is an argument that goes toward intent, and given the language in their argument, it is apparent (at least to me) that there is no intent to deceive on this point.
Any voters who fails to fully read the ballot language and proposed ordinance is asking for trouble in the form of misunderstanding what they vote on. That, of course, is not an argument against accuracy, but it is not as though council is attempting to pull the wool over the voters’ eyes when their ballot argument clarifies the problem that Mr. Dunning cites.
As we noted in our Sunday Commentary, however, there is a bigger problem with the rest of the argument put forward by the members of the Davis City Council.
The council writes, “This modest increase in our sales tax rate will fund essential community needs that shouldn’t be delayed further, including: Road, sidewalk, bike path, streetlight repairs (and) Parks, landscaping, street tree maintenance.”
As noted on Sunday, it is not that this is a false argument completely, but it fails to acknowledge that $2.3 million of the $3.6 million generated is going to personnel-related costs and that the $2.5 million that was originally to go to road maintenance was stripped down to $1 million when the council reduced the size of the tax increase to half a cent from three-quarters of a cent that was originally proposed.
In other words, most of the specific items cited by council will be put into the November parcel tax, not the June sales tax.
The council members are correct: “Without this measure’s approval, basic services (including police, fire, parks, recreation) will suffer severe cuts, up to 12.5 percent. Davis will become a less safe and less pleasant place to live.”
The all-cuts list will be ugly and disturbing to the public, and city employees in particular.
The city is correct when it states, “The City Council has recently restructured labor contracts for major cost savings and long-term fiscal sustainability, with employees paying significantly more toward their retirement. Davis has decreased its workforce by 22 percent, or 103 full-time employees.”
However, they are misleading when they state, “The longer Davis defers major road repairs, parks maintenance, and water conservation projects, the costlier they become.”
In fact, the decision to reduce the size of the sales tax does exactly what they warn against – defers major road repairs and parks maintenance by at least another six months, greatly adding to their cost.
The city residents, as we suggested on Sunday, deserve to have the facts laid out clearly and concisely. They deserve a full debate on the merits of the proposal.
—David M. Greenwald reporting
Dunning is right, there’s no reason why the language can’t be more concise. The same thing happened in the last election with the school parcel tax.
I don’t see anything misleading about this statement.
Out of context this decision, to go with the lower sales tax, given the statement does seem contradictory.
That was a lot of words to attempt not to say what is obvious: Dunning is correct.
Politicians influencing ballot language? Gambling in Monte Carlo?
but he wasn’t saying that dunning is correct. his main argument appears to be that dunning is assuming nefarious reasons for the mistake.
clearly dunning has no evidence to support the notion that they think we’re stupid, not paying attention or can slip it by the censors…
he then presents evidence of this by citing the ballot argument language where they essentially state what dunning does.
The wording on the ballot itself has to be precise, is that that hard?
No one disagrees with that point. Had it stopped there, I would not have written this piece. But as DP points out, it’s jumping to conclusions that bothers me.
If we are honest I don’t think a single one of us would answer:
“collect a sales and use tax for general government purposes at the total rate of 1 percent through Dec. 31, 2020”
When asked by a close friend (or even someone we didn’t know) what Measure O is about….
GREENWALD: “Why Mr. Dunning believes this is anything other than an inadvertent error is puzzling.”
Just when I think you could not be more daft, you write this ‘inadvertent error’ hokum.
One would have to be catatonic to really believe there was any accident in this case. The City wrote the language it did because the City desperately wants this sales tax increase to be passed by the voters. Obviously, the City believes the current language is the most palatable sales pitch. But as Bob Dunning correctly points out, it is dishonest language. It mischaracterizes the vote. It ignores the fact that 2004 tax increase–which was supposed to put Davis on a sustainable path, but instead all went to huge increases in compensation–would expire and that the new vote is to both renew that and to raise another new tax, supposedly to get us to a sustainable path. (Of course, no one on this City Council has explained to the public what mistakes they made to put us in such a bad situation. And no one of them has said what they will do, if this tax passes, to fix our labor problems so that we will be on a sustainable path.)
Unrelated, but pertinent point: The City of Vallejo is about to go back into bankruptcy. Why? Because after it emerged from that process the last time, they went right back to increasing their labor compensation at an unsustainable pace. There is no reason why anyone in Davis should think that this new tax increase will lead Davis to a sustainable path. There is every reason to believe they will take this money and we will be in dire straights in 2-3 years, just with less money in the pockets of residents to show for it. And our infrastructure will continue to fall apart.
If the city intentionally did that as you suggest, why put in their argument: “Measure O proposes to increase our community’s sales tax to 8.5 percent until 2020. This represents a one-half cent increase now, and will continue until 2020 an existing one-half cent tax due to expire in 2016.”
So if they are trying to hide this fact intentionally, why explicitly state it in their arguments?
Because most people never read past the intro . . .
I’m not arguing it’s not misleading, just don’t believe it intentionally so.
I want to believe it was not intentional and I probably do, but the incompetence needed to have the wording get approved like that is a bit stunning.
Am I mistaken in believing this would have been drafted by legal counsel and reviewed by at least a couple people who understand it?
Since this has now come forward in my opinion if the council doesn’t choose Option #2 then I think their intentions can and should be brought into question.
Fair enough
Yes, deceptive. They want more money to pad their own coffers, with no end in sight.
We’re big boys and girls. Give us an overall game plan for cuts, reductions, and new taxes. Trying to sneak tax extensions along with new taxes with a spoon full of sugar makes me wonder about your true intentions.
Given this repeated slight-of-hand, maybe we need a way to segment off new potential revenues from the general city coffers (say, from the hotel and conference center, or the Nishi property), and direct them explicitly to road and school repair, so that future new funds are not squandered on new pet projects and do-gooder ideas.
“so that future new funds are not squandered on new pet projects and do-gooder ideas.”
It would be nice if one penny of the new taxes would go to ‘new pet projects’ or to ‘do-gooder ideas.’ The reality is that almost every cent is going to go to employee compensation. Specifically, your money will be spent to cover higher salaries, higher pension funding costs, higher medical benefits, higher retiree medical care for current employees, paying the unfunded OPEB for retirees (and the wives and children of retirees) and paying the underfunded pensions of current and former employees
And, unless the City Council–for the first time ever–puts in place controls to make sure employee compensation does not keep rising faster than the growth of revenues, we will be in a fiscal crisis again in 2017, even with this new tax. And that does not even touch the amount we are in debt with regard to roads, sidewalks, plant and equipment maintenance, parks repair, and so on.
But at least the Vanguard thinks the City Council is really doing a swell job.
So I’m curious what your prediction would be as to what will happen if the sales tax fails to pass. And as a second scenario, if a parcel tax passes in the fall.
If it fails, there will be a short term reaction of drastically cutting city services via the 52 FTEs.
I would hope, but don’t expect, that the next reaction would be for the City to declare a fiscal emergency. That would allow the City to unilaterally change the labor contracts–something like an across the board 10% pay cut*–in order to stem the bleeding and restore all 52 FTEs.
If that were done, we could survive until 12-31-15, when the current (bad) labor contracts expire. But before they expire, I would hope (but don’t expect) the City Council to start the (ridiculously long) process of imposing new contracts on all City employees, which (to be sustainable) must cap the growth of total employee compensation, including retirement benefits. I think the new labor contracts also have to restore the vesting requirement, which this Council removed, for OPEB qualification. I also think the new contracts need to stop paying all OPEB for the families of our retirees. I also think the new contracts need to stop paying all OPEB for retirees under age 65 (save those who had to retire due to disability).
But, of course, the people of Davis don’t seem at all interested in electing people to the City Council who really care to do what needs to be done to save us from bankruptcy. So I do expect, if the tax fails, we will file for bankruptcy before 2020.
*Mike Harrington called for a 10% pay cut in late 2003, when we faced a big budget problem. He was shouted down by Susie Boyd, who said he was out of order for suggesting any such thing. She and the other four then voted for a big tax increase (approved by the voters on March 2, 2004); and as a result, the total comp of all city employees went up by about 45% before the tax took effect; and once it started (in Nov. 2004), the City Council approved huge raises for all employees, most of which went to the firefighters.
If you are interested in knowing more about the meaning and process of a Declaration of Fiscal Emergency, here is a link:
http://www.publiclawgroup.com/wp-content/uploads/2011/12/Declarations-of-Fiscal-Emergency.pdf
One other point: In his writing on the question of bankruptcy, David Greenwald has made it clear he has no idea how the process works or even what municipal bankruptcy means. It is not the case that a city must have already cut back its entire labor force and has too little income to make its bond payments or other debt obligations (like bills to PERS) or to make its accounts payable.
A city can declare bankruptcy when, due to the cost of its labor force, it can no longer provide basic city services such as police and fire protection and ordinary maintenance of its roads and parks. We are not quite there, because we still have a general fund reserve and reserves in some other fungible funds. Also, we still are spending money on programs which are not core services, like roads, police, fire, park maintenance, etc.
However, we are very close. And the fact that we cannot maintain our roads puts us, even now, in a gray area. If we cut back everything but police, fire and parks, right now, and we spent any extra on roads, we would likely qualify for bankruptcy, just because we have too little to adequately maintain our roads.
Rich Rifkin
“One other point: In his writing on the question of bankruptcy, David Greenwald has made it clear he has no idea how the process works or even what municipal bankruptcy means.”
I agree. If you had $1000 to invest, who would you trust with your money, David or Rich Rifkin?
I think that’s an easy decision.
I’ll split my investment $500 each to be managed by John Munn and Frank Lee.
We are not close to the situation of Stockton and Vallejo. Because we have far less of our budget dedicated to public safety -it is over 80% of General Fund in both Vallejo and Stockton – we can cut a lot more before we get to bankruptcy.
The point I was trying to make which you took out of context and tortured is that unlike Davis, Stockton accumulated a large amount of debt which within the general fund. In San Bernadino, they just ignored doom, made no cuts, and continued to pay increases to their unions (which owned them) even while in bankruptcy. Neither of these situations are parallel to Davis.
We may not be as bankrupt as Vallejo, but we are still going down. They are our role model, and lots of other cities will follow.
Don’t be a bankruptcy denialist.
It is also inaccurate to state that because our roads are underfunded, in poor condition and getting worse that this will push us to bankruptcy. The city believes that the roads can continue to deteriorate another 5 to 7 years before they really get bad. This is not advisable policy and will end up costing a lot more, but this isn’t an issue of bankruptcy.
We can “survive” with bad roads. However, waiting much longer to fix them will prevent us from realistically ever catching up and much of the town will end up looking like Olive Drive. People still drive on Olive, the world is not ending, it will mean a boon for car repair shops.
“It is also inaccurate to state that because our roads are underfunded, in poor condition and getting worse that this will push us to bankruptcy.”
You may be 100% right on that. If so, I apologize for my error. I don’t know exactly how federal bankruptcy courts deal with road maintenance.
However, in a number of cases of bankrupt cities which I have read about, I learned that the courts seem to be asking a question of “vital services.” That language was used in the Detroit case. They seem to have defined vital services as police, fire and roads. And they said that a city did not have to lay off its police force or its firefighters or stop paying for road maintenance in order to be eligible for Chapter 9 bankruptcy. Rather, it had to be in a position where, after paying for its vital services, it could not make its debt obligations.
In Davis, if we were to keep all of our police and fire services (as they now are) intact, and we started paying for road maintenance and the maintenance of other vital infrastructure (like sewer mains), and the sales tax increase failed, we would probably qualify for Chapter 9 before too long, even if we fired every city employee who did not work in top administration, police, fire or public works.
The reason that degree of insolvency is not apparent is because we are paying almost nothing for our roads and sidewalk maintenance, and we are underfunding maintenance for other infrastructure.
Keep in mind that we have real debts that need to be paid off after our vital services. They include some bonded debt and debts to CalPERS for OPEB and pensions which are unfunded. If we truly kept up our so-called vital services, then I cannot imagine it would be too long before we could not make those debt payments.
I find it interesting that we just had big, ugly containers made of petroleum products forced on us because the kids might accidentally ride their bikes into a pile of green waste at night without a bike light… and, from some of the people that jumped all over this point to justify their position are now making a case that we don’t need to maintain our roads for the next 5-7 years… I assume to argue against declaring a fiscal emergency and needing to cut more city staff.
You’re simply missing the distinction between fiscal emergency in the legal sense and having a very bad problem that we need to deal with.
Maybe… but I think the other point is that our deteriorating roads could very well fit into the justification for a fiscal emergency.
“David Greenwald has made it clear he has no idea how the process works or even what municipal bankruptcy means.”
This was an over-the-top and dumb statement by me. I apologize. In truth, I am not any expert on this area of the law. I am simply regurgitating what I have read in news articles about other cities which have gone into Chapter 9, and how the process worked.
Going back, David, you were pretty adamant that municipal bankruptcy required a default on debt. I think you now understand this is not the case. Your point about the road maintenance is fair. As Rich writes, I think this would have to be argued in the courts. But it would only take one serious bike accident resulting from road problems to make a strong case against delaying maintenance.
Related to this… two weeks ago I was walking my dog at night. I crossed where one of our many non-functioning street lights was doing its job shedding darkness on my path, and promptly sprained my ankle stepping into a pretty deep pothole. And I am still a pretty athletic dude. Just think about all the seniors and kids traversing all the streets with the growing number of potholes. And, since we have so many anti-car militants pushing the levers of our transportation policy, it would seem that Davis should be paying MORE attention to its road maintenance rather than pushing the envelope for how long we can hold out to save those over-paid (when considering total compensation) city jobs.
Taking City funds for “school repair”? Why not diverting City revenues for increases to school employee compensation (raises and increases in benefits) as well?
Actually I think they are trying to avoid laying off employees and cutting services.
David, on the above picture is that the hand of the city or a firefighter reaching into our wallet?
I leave it to your imagination
GI wrote:
> David, on the above picture is that the hand of the
> city or a firefighter reaching into our wallet?
It looks like a firefighter reaching in to his own wallet to buy an 18 year old bottle of Scotch to enjoy on one of the 20 days off they have every month (my firefighter friends are the only ones I know that always seem to have $100 bills in their wallet and 18 year old Scotch on the shelf)…
Maybe he should have asked them, instead of assuming only negative motives. But I guess that would make for a pretty boring column.
That language was already released to the public. The only way to bring the public’s attention to the egregious error would be to … go public.
Besides, -if- they are the sort to be deceptive, the only answer he’d get would be deceptive as well.
No problem with going public. Problem with assuming nefarious motives.
Honesty is the best policy. Words to live, and write columns by.
While we cannot know the true intent of the Council, the sentence is absolutely deceptive. You cannot read that and make any other assumption than the current rate must be 1% and we are voting to continue it.
“Given space limitations, the city probably cannot explain that what they are really doing…”
Baloney.
The wording used is deceptive, either through intent or incompetence doesn’t really matter. This is a Measure going up for vote affecting taxation for over half a decade. This isn’t something you text out in a tweet and then go, “Oops.” This is something that should be drafted by legal counsel and reviewed by many.
I don’t always agree with Dunning and this is a measure I’ll probably vote for, but he was absolutely right to attack the language. I’m actually shocked you are defending the Council in any way.
Rich thanks for the comment about my attempt to cut salaries. Susie screaming that I had no right to even bring it up is burned in my brain.
I cannot imagine the November parcel tax has any reasonable chance passing. The water project rates are sucking the town fisc dry already.
I support the sales tax increase… not strongly… but I support it nonetheless.
Here is why…
First – I think the mistakes made by previous council were at a different time where many Davis voters had their head happily in the sand either denying that we had any serious fiscal problems, or overly optimistic that the economy and wealth would keep growing so that we could put it off to another day. Think the numbers of voters still holding these views has dwindled quite a bit.
Second – More of us know the true financial picture and it is much bleaker than we every knew.
Third – Although Davis is a significant liberal town, it has always had a core of strong fiscal conservatism… a core that previously never reared up in support or opposition to spending and revenue policies because of the previous.
Four – When organizations start having financial difficulty that causes significant job security concerns, it is the best employees that tend to leave. Just like in the general economy, certainty is a very important consideration for economic decision making. If the sales tax measure fails, we will likely see some good people quit out of concern, and the less good people sticking around to fill the void.
Five – Related to the previous, I am never in favor of using a bomb to effect needed change unless a bomb is needed. A failed sale tax increase would be like a fiscal bomb into the city budget and it would require some immediate cutting. I am reasonably comfortable at this point that our city council will do all the right things to use a scalpel to cut strategically after the sale tax measure is passed.
Now, here is my final “kicker” to all of this…
MY OPINION CHANGES IF SHEILA ALLEN IS ELECTED.
If Ms. Allen is elected to the city council, then I am going to by absolutely 100% against the sales tax increase and any subsequent parcel tax increase. Because if she is elected it destroys my opinion that Davis is filled with fiscal conservatives and people that no longer have their head in the sand. And because of that, I shift to being in favor of the fiscal bomb approach.
But how will I know if Ms. Allen is elected in time to help me make my decision on the sales tax initiative?
First, I will pay attention to the general predictions of experts on this as to what her chances may be… including how much campaign money she gets and who endorses her (and at this point it is not trending well for my support of the sales tax), and I will wait until the last minute to vote hoping to see some precinct results.