SALES TAX HIKE

Rising costs prompt several Kern cities to look at

Tehachapi decided Monday to join a growing number of Kern cities looking to address rising costs and revenue concerns by asking voters if they’d approve a local sales tax increase in November.

Ridgecrest is expected to hold such a discussion today at its City Council meeting.

Arvin, Delano and Taft have levies in place that supplement their budgets, as does Bakersfield, which implemented Measure N, also known as the Public Safety and Vital Services measure, in 2018.

McFarland decided in the spring to make a similar request to its voters.

And the Kern County Board of Supervisors recently voted to place a 1-cent sales tax on the November ballot. If passed by voters living in unincorporated areas of the county, it would be collected only in areas outside city limits.

While each jurisdiction has a slightly different approach, officials in most of the cities mentioned their anticipated increases in the cost of providing basic services as the impetus for the move.

“I think the real catalyst to it is the ever-increasing cost to run a city, and part of that is the fire contract with the county — no doubt about it,” said Kenny Williams, who serves as city manager and police chief for McFarland.

The McFarland City Council unanimously approved at its March 24 meeting putting the question of a 1-cent sales tax to voters in November. Currently, the city’s sales tax rate is 7.25 percent, which is in line with most cities in Kern (see chart).

Noting the city’s years-long financial struggles, a sales tax increase would help in a number of areas, he said.

“Obviously the fire contract is a piece of that, but I would also

look at the positions of law enforcement officers,” Williams added, noting the city is funding seven positions through grant funding set to expire over the next two years.

“So primarily public safety, which is fire, police and our roads, as well, are the main catalysts, I think, for that 1 percent sales tax,” he said.

RISING PUBLIC SAFETY COSTS

Negotiations over the last year with cities that contract with the Kern County Fire Department for its services resulted in the county receiving more than $7 million for those services, according to previous reporting in The Californian.

The reasons the charge for the services needed to increase were two-fold: The county was running a deficit that was as high as $10 million last year coupled with the fact that a county-commissioned study by the Center for Public Safety Management indicated the county was only charging about 48 cents on the dollar for the services it was providing.

But public safety costs were only a portion of the concern for a number of the cities that have looked at sales tax increases recently or in the last couple of years.

While Ridgecrest is expected to see a more than 500 percent increase in the cost of its fire service, that was only one reason for the move, according to City Manager Ron Strand.

The city’s cost was expected to increase from $274,457 to about $1.5 million over the next six years. However, the measure that the city might put before voters would add almost $6 million annually to the city’s budget.

If approved, that money could help the city reopen its public pool, Strand said, as well as maintain the city’s roads, over the proposed nine-year lifespan of the measure.

“It would give the city the ability to make decisions on what their priorities are over the next nine years,” he said, noting that the city also had to reduce its police department by four positions in its last budget, and additional revenue could allow the city to consider restoring those positions.

RECENT INCREASES

Arvin and Taft already have 1-cent sales tax measures in place that are helping their governments pay for fire services, enhance police services and cover other rising infrastructure costs.

Arvin City and Finance Manager Jeff Jones acknowledged the city recently approved a new fire contract that would double the cost of its service from about $700,000 to $1.4 million over the next six years. But with a 1 percent sales tax already in place, he said it would be harder for the city to ask residents to pay more.

Jones also noted the cannabis tax that voters approved in 2018 was starting to generate income that would help with those costs. The fee brought in about $400,000 last year and is expected to bring in about $600,000 next year. That revenue has allowed the city to enhance services, he said. The city’s next budget will include four new police officers and an animal control officer, in addition to helping in a few other areas.

Taft had a special election in November 2021 for its sales tax increase, which was at that time primarily driven by the need to replace revenue the city lost when the local prison closed, according to Taft City Clerk Yvette Mayfield. That measure is expected to bring about $1.6 million to the city each year, which is meant to help the city retain its number of police officers, firefighters and local businesses, according to an Aug. 16 report to the City Council. The measure was approved by voters 76.72 percent to 23.28 percent, according to Kernvote.com.

“The biggest emphasis on this (measure) was to basically be able to keep the services we already offer at a level we already offer them at,” Mayfield explained, “because our budget was going to take such a hit with the closure of our (correctional facility) that if we had not gotten this passed, we would have had to reduce services around the whole city.”

Delano’s Measure U, which voters approved in 2018, raised the city’s sales tax from 7.25 percent to 8.25 percent.

“It goes to our general fund, but of course, our fire is a good portion of funds that would be paid out of the general fund — but it goes to a lot of things,” said Maribel Reyna, Delano city manager. “It goes to recreation, it goes to (the police department), it goes to all kinds of things.”

NO INCREASES

Maricopa, as the smallest city in the county and one of the smallest in the state, according to city administrator Eric Ziegler, isn’t expecting a large increase in fire costs, as the community’s size would make it quite impossible to pay much more than it does.

That’s probably a good thing, as the last time the city tried to put a revenue-generating sales tax on the ballot, it was “slaughtered” by voters, he said — while being quick to note that such a result doesn’t require a lot of votes in Maricopa. The city’s operating budget is around $300,000, and Ziegler is already helping out on a volunteer basis since his retirement more than 10 years ago.

In November 2012, local voters there rejected a 1-cent sales tax increase by a tally of 184 votes against and 97 in favor.

Shafter isn’t one of the cities looking at a sales tax increase, according to City Manager Gabriel Gonzalez, noting the city has benefited from property taxes generated by large-scale investment from the business community, including The Wonderful Co.

“I think from a high level, I would say that every city in the state of California is concerned about its budget conditions and revenue situation, right? I think that goes without saying with everything that’s happening in the economy as a whole,” Gonzalez said.

“But as far as we know, the master plan for the Wonderful Industrial Park still calls out for additional warehousing space to continue to be built out. And so as long as that continues, then, hopefully, there’s sufficient revenues generated for the fire fund that will continue to offset the cost in the fire contract.”