Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Supervisor Jackie Speier, District 1
Supervisor Lisa Gauthier, District 4
Subject: Legislation to Increase the County’s Maximum Local Transactions and Use Tax Rate
RECOMMENDATION:
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Adopt a resolution to sponsor legislation that would increase the current maximum local transactions and use tax rate by up to 0.5% to ensure adequate funding for critical local services and to meet essential community needs.
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BACKGROUND:
Recent changes in state and federal funding streams have placed revenues that fund core County services at risk. The County may wish to consider options to address potential funding shortfalls resulting from state and federal budgetary and legislative actions.
In response to these challenges, several local governments in the Bay Area have taken steps to increase their transactions and use tax. Should the Board of Supervisors choose to pursue this option, state legislation would be required.
DISCUSSION:
The proposed legislation would allow the County, by ordinance or citizens’ initiative, to place on the ballot a transactions and use tax at a rate of up to 0.5%, exceeding the 2% statutory limit, which, if approved by voters, could provide a revenue solution to provide local funding and ensure continued support for essential services, including childcare, afterschool care, early childhood education, food assistance, healthcare support, tenant assistance, senior programs, and other general governmental services.
The proposed legislation sunsets after five years, meaning that, if the tax is not pursued within the five-year period, the authorization to exceed the 2% statutory limit would be repealed.
A full analysis of the legislative proposal can be found in the attached form.
The County Attorney’s Office has reviewed and approved the resolution as to form.
COMMUNITY IMPACT:
The legislative proposal is intended to help address affordability challenges for all San Mateo County residents, particularly at a time where potential funding reductions may cause severe disruptions in the provision of County services.
FISCAL IMPACT:
Adoption of this resolution will have no Net County cost.