One of the biggest issues facing the city of Davis is how it is going to close its current shortfall between revenue and unfunded liabilities as well as infrastructure needs, currently estimated at roughly $8.5 million annually.
The next discussion, according to City Manager Mike Webb, is next week: “Yes, we’ve had it on the long range for the 19th to follow up with Council on the revenue measure discussion.”
The question before the council is which direction they want to go with the type of tax, the amount, and what the tax will fund.
Mr. Webb told the Vanguard, “During their last discussion the Council indicated an interest in the possibility of three different measures, but nothing is final. On December 19th I expect the discussion to continue.”
He indicated, “We will present Council with follow up information from their last discussion, with focus on what projects or priorities the City might pursue with the various ballot measure(s). Fundamentally, this will be an opportunity for the Council to further its discussion on the topic and to identify additional information that may be instrumental to their final decision on what measure(s) to pursue, at what amounts, and for what priorities.”
Some of the key areas of focus will be creating funds to fill the fund gap on parks. Currently the city is only taking in $49 for its parks tax, when actual costs run about four times that and 
unfunded needs perhaps run even higher.
Many believe that the council back in 2012 erred by not raising the parks tax above $49 when they had the chance.
City Councilmember Will Arnold told the Vanguard, “We need to renew the parks tax at absolute minimum. I believe a doubling of the current $49 tax would be prudent.”
But parks is not the only the money that the council needs. The city has long had a need to add revenue for roads, bike paths and sidewalks. To their credit, the council has carved out about $4 million per year for infrastructure needs, but they probably need at least $8 million and perhaps as much as $10 million.
Councilmember Arnold told the Vanguard, “I also believe a similar-sized measure dedicated to transportation infrastructure is desirable. So as I said at the last meeting in which this came up, $99 for parks and $99 for roads (or “potholes” to be alliterative).”
The wild card is a potential $50 parcel tax that could fund other needs. They are looking at a potential $50 for social services. A $50 tax for social services puts the tax ask to potentially $300 per year.
But as Will Arnold pointed out during their October discussion, “if Robb Davis puts his talents behind the $50, it passes easily.”
He told the Vanguard, “I am also not closing the door to the mayor’s call for a smaller tax to address homelessness, though further discussion and detail is needed.”
This weekend the Vanguard raised the specter that the city could use some of that $50 for an affordable housing fund, something that Will Arnold said seemed like a good idea, but indicated he would defer to Mayor Davis on whether he’s open to that.
Mayor Robb Davis told the Vanguard, “When the RDA [Redevelopment Agency] ended, the City lost over $2 million per year for its affordable housing programs. A $50/year parcel tax would bring in about $1.5 million per year, and while that does not fill the gap, it provides critical resources for affordable housing and services for homeless and vulnerable individuals.”
He believes, “The revenue from this tax will provide a predictable revenue stream for programs that have had to rely on uncertain or one-time grants. That stream will enable us to expand the pathways to employment program. It will enable us to expand services for (the) emergency shelter year round, add critical physical and mental health services to the Interfaith Rotating Winter Shelter, and enable us to continue and expand bridge housing vouchers or create a housing voucher program of our own. Such voucher programs allow us to place formerly homeless individuals into already existing units.”
Mayor Davis added that “the revenue can support our housing trust fund to help maintain existing affordable housing stock in the city. The trust fund can also be leveraged to build new affordable units if and when land dedication sites come forward. Finally, this revenue can contribute to expanding support to agencies that provide critical services via our existing Community Development Block Grants (CDBG).
“The fact that this tax can provide for such varied services and infrastructure is because these services are delivered largely through non-profits and with the strong support of Yolo County Housing. It will enable us to significantly expand existing services provided via County support, leveraging those resources for greater impact,” he said.
Finally, the mayor added, “the revenue comes at a time when the City is developing critical impact assessment metrics and progress tracking systems to assure that all expenditures are done in an accountable way, with a focus on outcomes and impacts, not merely outputs.”
While $50 is probably not enough to address both affordable housing needs and homeless issues, it is a start. And combined with other monies it could go a long way toward helping to resolve some long-time challenges for the city, now strapped for cash in the post-RDA world.
The council doesn’t have to make their final decision this week, however, As City Manager Mike Webb, noted, “For a June ballot the Council will need to make a final decision on what to put on the ballot by their first meeting in February, which leaves the January meetings to allow for further follow-up with Council as needed.”
—David M. Greenwald reporting
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$300 more being lumped on homeowners with another $300(?) coming our way for teacher salaries.
Homeowners are being asked to foot almost the entire bill for the city, where’s the apartment owners stake?
Why not a UUT or a sales tax to make the cost more equitable so everyone shares in the costs?
Worry not on the doubling up, Keith… the smart money is on there being “discussions” between the City and DJUSD where the City will defer a vote on any City assessments/taxes until after DJUSD gets their piece of the action, for increased teacher/administrator/staff compensation (“it’s for the kids”, after all)… if the District is successful, at say $300 (?) per parcel, any City measure, at least with any increases from current rates, will probably be DOA.
A parcel tax is paid by tenants. MF tenants will pay a much smaller share, but SF tenants will pay the same as homeowners. Homeowners are in a MUCH better position to bear the burden of higher taxes than tenants. http://www.ocregister.com/2017/06/05/homeowners-worth-197349-more-than-renters-census-study-shows/
With a $99 parcel tax for parks maybe we can install another $181,500 bike pump track?
Parcel tax money was not used for the pump track nor was general fund money.
The money came from park impact fees. So instead of reaching into the left pocket they reached into the right pocket.
But the money is siloed.
GF money is not “siloed”… if GF money is currently used to cover park maintenance, for example, then new funds specifically for park maintenance will offset the needs for that “subsidy” and free it up for any other purpose…
Yes, and that’s part of the problem. The optics of building what many in town see as an uneeded luxory while being told they need to pony up for a higher parks tax.
Sorry to be dense, but relative to Keith O’s statement, what is a UUT? Thanks. — Greg Rowe
Users Utility Tax
A tax on electricity, or cable. or phone, or water, etc.
Some combination of these where everyone has skin in the game.
Can anyone explain why the city is favoring a parcel tax instead of a UUT?
It’s more ‘familiar’, and duplexes, MF, non-res properties pay less with a parcel tax… simple math… if you’re counting votes and/or organized opposition…
Yes, it’s nice to vote for taxes that other people have to pay the brunt of.
So, KO are you affirming what I wrote/opined or countering it? Unclear….
I don’t understand why we are talking about more taxes before getting serious about cost containment. If we don’t stop the rising costs, no amount of new taxes will be sufficient. The Council majority had an opportunity to demonstrate a commitment to cost containment with the hiring of the new City Manager, but unfortunately, chose the status quo instead.
We need to prioritize the services that the City provides, then find more cost-effective ways to supply the high-priority services, while considering cutting the low priority ones. Once we get cost growth under control, then we should look at the tax increases necessary to fill in the gaps. Without serious cost containment and the prioritization of services, I would find it very difficult to support additional taxes.
You ought to consider running for CC…
And expand on those thoughts….
I agree with Mark West here.
I am hoping that someone who believes in the principle of individual responsibility can explain to me why it is that they do not believe that we should pay for agreed upon needs through taxation. I hear individuals want the city to “do something” about the homeless, but do not want to pay for programs designed to help them. I hear individuals want the roads fixed, but do not see it as their responsibility to pay for that. I hear individuals use the phrase “everyone has skin in the game” without acknowledging that homeowners by and larger have an asset in their home that others do not have. Should those who have more not also have more responsibility ?
Meant fairly, Tia… a concept of taxation and fees are that they be proportional to ‘ability to pay’, and/or burden/benefit.
The STRUCTURE of taxes and fairness of assessment is where there is a problem… I’d consider a City income tax or a UUT more favorably than additional parcel taxes… there is much unfairness, in my opinion, in the latter approach. MF complexes both have more ability to pay, and burdens/benefits… yet a 100 unit complex pays the same as a SF unit. Same for non-res.
Tia, you act as if everyone who’s is buying a home is rolling in money. Not the case, sure there are a few who are but many are scraping by in order to pay their mortgage and bills. How many renters are well off? Some people choose to rent because they don’t want the responsibilities of home ownership but do have money.
Are you talking about the people who don’t have to pay any parcel taxes or pay very little?
Howard P – Then you should agree to a % adder to the property tax rate then a parcel tax. That would tie it to value rather than arbitrary. Tax burden should be tied to wealth as property value is tied to community attributes (e.g., see valuation differences between Davis and Woodland)–see my next response.
Keith O – Homeowners are worth on average $200,000 more than tenants. There may be exceptions, but we have to make policy based on our understanding of the whole population, not just a small segment. And everyone who lives in Davis pays the parcel tax; for tenants, as with property taxes, it’s rolled into the rent.
http://www.ocregister.com/2017/06/05/homeowners-worth-197349-more-than-renters-census-study-shows/
Not clear on your point… (and I perused the article)…
One of the effects of Prop 13 was good… homeowners, particularly those retired, would not get taxed out of their houses because of a “paper gain”… bad sides: commercial property, through machinations that Gann loved, could escape re-assessment, like forever, if they did it (transfers) right… unequal taxes of similar properties with similar household income.
Funny thing… when I lived in Millbrae, in the years preceding prop 13, tax rates went down… they had more revenue than they needed, and a healthy reserve… tax rates and assessments significantly increased in the first years following the passage of Prop 13.
The measure was deeply flawed, as to equity/fairness. Gann loved that… he knew it, but he was basically anti-government… Jarvis (nice guy, met and chatted with him at the time), was Gann’s “useful idiot”… he was the ‘closer’…
Prop 13 needs to be completely revisited… total repeal/overhaul… if it is done for both res and non-res, with a zero-sum result, I’d support that. I’d probably accept that… even if I paid more on property tax, but lost the parcel tax thing… even if the end result was more tax.
Until then, I’ll enjoy my situation.
In consideration of the total compensation, we pay WAY too much for city labor based on the overall labor market.
Compounding this the high population of Davis NIMBYs that block any and all development that would serve to increase our tax base.
So, any additional tax increase to help bridge the gap between spending and revenue is a fee-penalty charged to residents to supplement the over-payment of city employee, AND to fund the NIMBY agenda.
Tax increases have aggregate negative consequences for a community. They cannot keep increasing without causing damage in excess of the problems they claim to solve.
Agree with the thrust of the point and I think the city council needs to commit to innovation centers or increasing revenue through ED/ business as part of the tax discussion.
The goal of economic development is not to be a source of new revenue for the City, but to improve the quality of life for residents by creating jobs, expanding business opportunities, and generally making the community wealthier. It is the expanded economic activity that arises from this more vibrant economic environment that results in the new revenues for the City. Economic development is critical for creating a better future for City residents, but the fiscal impacts for the City are a secondary benefit, not the primary goal.
Agree with both comments. But net positive tax revenue for most communities flows from the commercial activity of the community… either directly though retail and property tax revenue, or indirectly as the people involved spend money in the community. Davis is not really far out of the norm for city employee pay (except maybe our fire department). But Davis is far out of the norm for commercial property and commercial activity per capita.
That is not to say that I believe city compensation to be off the table… on the contrary. However this is a state-wide problem that needs a solution unless Davis is willing to cut services.
Just find it ironic that the city is pushing money-losing megadorms (perhaps including Nishi), while simultaneously asking single-family owners to pay a larger and larger share of taxes.
Makes perfect sense (your point), if you are a SF owner… and even more so if you are mortgage free… and with the proposed elimination of local taxes as a deduction…
It’s called “vested self-interest”… fact, not a judgement.
I understand your real point, Ron.
I agree.