New measures may raise local taxes

November 4, 2009 7:44:03 PM PST
Bay Area voters were in a generous mood at the polls yesterday, approving 22 of 29 measures to help close city budget gaps with new taxes. But in some communities, voters drew a hard line.

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The recession was thought to be the biggest obstacle at the polls.

San Mateo's Measure L called for a quarter-percent sales tax increase and it passed with just over 60 percent of the vote. The city had already cut 100 positions in recent years.

"They recognize we have been very responsible in managing the budget," said San Mateo City Council Member Jan Epstein.

Even the city's two major business groups backed the tax increase, knowing the alternative was to cut fire and police, parks and other services.

"No one wants their services to be cut -- parks, any of that and I think they heard that. So the message was good to the community," said Linda Ashbury from the San Mateo Area Chamber of Commerce.

A few miles away, voters in San Carlos turned down a larger, half-cent sales tax hike.

"It's a very tough call because there's only so much you can do and then you have public safety concerns, so I'm concerned about that," said San Carlos resident Diane Gates.

Voters took a similar hardline in Palo Alto to a new business tax, even though it targeted employers, not residents. It would have generated $3.3 million, but the business climate may have been a deciding factor.

"The small businesses I talked to were losing money, and while the city viewed the business tax of $200, $300 as a modest amount, when you're losing money, $200 might as well be $2,000," said Measure A opponent Skip Justman.

Without the new tax, Palo Alto will have to put a red pencil to its budget.

"We're going to have to look at additional changes this year, and then next year's going to be equally difficult," said Palo Alto City Manager Jim Keene.

Over time, many cities have had difficulty balancing their budgets. But people argue that now we're entering a new period called the 'new normal,' and cities may be going back to taxpayers more often to help them balance the books.

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