League of Women Voters of California Education Fund
	Santa Cruz County, CA November 4, 2008 Election
	Measure D Capitola Sales Tax Extension City of Capitola Simple Majority Approval Required Pass: 3,317 / 65.84% Yes votes ...... 1,721 / 34.16% No votes See Also: Index of all Measures

Arguments For Measure D

Arguments Against Measure D

In November 2004 with Capitola facing a severe fiscal plight, voters approved Measure P, authorizing an increase in the sales tax rate of one quarter of one percent. This tax increase annually generated about $1 million solely for the City of Capitola. During the last three years, the City used this revenue to: CONSTRUCT ALMOST $4 MILLION IN ROAD AND PUBLIC FACILITY IMPROVEMENTS. The City leveraged $2.6 million of Measure P money with grant funds. ADD A POLICE OFFICER AND CAPTAIN POSITIONS TO THE POLICE DEPARTMENT Restored other important City services. THE CITY HAS LOST REVENUES OR EXPERIENCED INCREASED COSTS FOR THE FOLLOWING REASONS: State reduction of local government funding sources State reduction of Vehicle In Lieu Taxes Unfunded mandated federal and state programs Decline in the economy The State and federal governments are in fiscal distress and will likely find ways to take more City revenues. The City of Capitola requests that the current tax measure be extended until December 31, 2017. This measure has broad community support because: It spreads the tax burden across a broad spectrum of people, including tourist and visitors. Nonresidents contribute 83 cents for each tax dollar collected. The added revenue will assist in the most critical areas of need including public safety and capital improvement programs. Capitola has no other special taxes, like a utility user tax. The tax impact is only 25 cents for every $100 of taxable expenditure. Capitola is a wonderful living environment, but the City's ability to provide needed public services and capital improvements is threatened. Help us to help you. Please, VOTE "YES" on this measure, and support your City in its efforts to deliver the most essential public services. s/ Kirby Nicol Mayor, City of Capitola s/ Robert A. Begun Vice Mayor, City of Capitola s/ Charles P. Thomas, III Business Owner s/ Rick Halterman County Mobile Home Commissioner s/ Stephanie Harlan Chairperson, Planning Commission Rebuttal to Arguments For We're worried. Frankly, we've been hoping the City would see by now that the clear pattern of climbing budgets and eroding revenues cannot continue. But we read their argument, and it is ALL about spending more money and raising taxes. Nothing acknowledging that Capitola is spending more than it can afford. Not a word about getting costs under control. $1 saved is better than $1 of new taxes. We don't pay retirement benefits on money saved. Apparently the Council feels the public is happy at the prospect of tax increases. Any money raised by extending Measure P is effectively already spent on increased costs for personnel and on bonds to pay old retirement costs. Yet revenues are declining across the board. Sales tax revenues are down double digits. A major auto dealership is leaving town soon. Make no mistake + a financial crisis is coming fast! Yet the big pay raises continue to grow for the next 3 years without let-up. Personnel costs jumped over a half million just this year. An $850 city popcorn machine just purchased shows that Capitola feels no sense of urgency or restraint about spending. We need to hear the City Council start talking about cost cutting, about pulling in the financial reins. We need to hear it NOW. The best way to deliver this message is to turn up the pressure and vote NO on extending Measure P. s/ Tony Gualtieri City Treasurer s/ Bruce R. Arthur Former Mayor & Council Member s/ Susan Westman Former City Manager s/ Kathryn Gualtieri Former Planning Commissioner s/ Nels Westman Capitola Resident

In 2004 Capitola asked voters to approve a TEMPORARY 1?4 %sales tax increase to kick start some long deferred street repairs, add beat cops and buy time for the City Council to correct some serious budget problems resulting from very high personnel costs. In 2004 City expenditures were $10,086,000. This year's expenditures are $13,051,300 and climbing, an increase of $3 million. Capitola does not have a revenue problem. It has a spending problem. With that new sales tax revenue Capitola hired yet another planner ($100,000/yr), a beat cop ($120,000) and a police Captain (essentially a $170,000 administrator) + not what we thought we were getting when we asked for police on the streets + all PERMANENT positions. Subsequently Capitola borrowed $5.9 million to finance the backlog of unfunded personnel retirement costs, a bond which costs $700,000 annually. Between new hires and these bond costs, proceeds of the TEMPORARY sales tax are totally offset by PERMANENT personnel cost increases. Meantime, nothing has been done to get skyrocketing personnel costs under control. Despite the cruel reality check of having to borrow $5.9 million to finance its earlier unfunded retirement costs, Capitola compounded the problem in recent years by granting new, expanded retirement benefits and generous salary increases to its employees. We voted for a TEMPORARY tax increase in 2004 to see Capitola through a bad patch. Silly us. No solutions; only higher PERMANENT personnel costs. The current temporary 1?4%sales tax lasts until 2010 though clearly Capitola considers it an almost certain permanent tax. Send a clear message to the City Council that we want staggering personnel costs brought under control by rejecting the SEVEN YEAR extension. We want solutions NOW! We are all tightening our belts. So should Capitola. Please vote NO on Measure P's Extension. s/ Tony Gualtieri City Treasurer s/ Bruce R. Arthur Former Mayor & Council Member s/ Susan Westman Former City Manager s/ Kathryn Gualtieri Former Planning Commissioner s/ Richard H. Novak CEO Rebuttal to Arguments Against Contrary to the assertions of those arguing against this Measure, Measure P delivered exactly what was promised, and more. This tax was originally proposed as a stopgap measure "to pay for general City operations including public safety and street improvements". The Argument in favor of Measure P noted that vital police and planning services were being reduced and essential public works improvements were being eliminated due to budget shortfalls. Those services have now been restored by adding a Police Captain, an Officer, and a Planner, while much-needed road improvements and other facilities have been constructed. Measure P dollars have been leveraged for the benefit of our City by more than 50% through outside grants. In recent years, under prudent leadership, our once depleted reserves have been restored, and our debt has been reduced or refinanced to great advantage. But not all our financial concerns have been solved yet. Capitola's budget is precariously balanced as both tax revenues and State and Federal subsidies decline. The economy is in a dramatic downturn. Our City is fighting for its fiscal future. Significant steps are being taken to develop new revenue sources for the future, but those monies will not be available for several years. Nonresidents pay about 83%of this tax. It has been, and still is, a crucial part of Capitola's solution. In a recent survey more than 75%of the respondents rated City services as excellent or good. Support our City and continue the excellence. Vote YES on Measure D. s/ Kirby A. Nicol Mayor s/ Sam Storey Councilmember s/ Ed Newman Planning Commissioner s/ Sean Saldavia RDA Treasurer s/ Jacques Bertrand Finance Committee Member

Full Text of Measure D

AN ORDINANCE OF THE PEOPLE OF THE CITY OF CAPITOLA AMENDING SECTION 16 OF ORDINANCE NO. 880 PERTAINING TO THE CITY OF CAPITOLA TRANSACTIONS AND USE TAX ADMINISTERED BY THE STATE BOARD OF EQUALIZATION THE PEOPLE OF THE CITY OF CAPITOLA, CALIFORNIA, DO ORDAIN AS FOLLOWS: Section 1. Section 16 of Ordinance No. 880 is hereby amended to read as follows. "Section 16. TERMINATION DATE. The authority to levy the tax imposed by this ordinance shall expire December 31, 2017."