Bob Dunning

Bob Dunning: Things are about to get interesting

By From page A2 | January 30, 2014

“Council on taxes: We need options,” said the headline over Dave Ryan’s story yesterday in Davis’ Only Local Daily Newspaper.
“The Davis City Council bought time Tuesday night to wait until the last minute to place taxes on the June ballot that could shore up city finances temporarily,” Ryan’s front-pager notes.
“What the members bought with that time are options to place a companion measure on the ballot that specifies — in a non-legally binding way — what the money will be used for, a chance to mull how to do outreach to the community and a shorter life span for the taxes.”
Generally, most of us are in favor of longer life spans, but when it comes to taxes, I think we can all live with shorter.
Adds Ryan: “The council also wants to emphasize to voters the city’s determination to build a business park that could bring in the necessary tax income for the long term.”
It used to be the city would try to “educate” the voters about these things. But now, in our kinder, gentler world, the operative word is “outreach.” They’re coming at us with arms outstretched, seeking our input, perhaps over a cup of a tea and a plate of cookies.
“The council is considering placing a three-quarter-cent addition to the sales tax on the June ballot and a $150-per-year parcel tax on the November ballot.”
Turns out the sales tax increase would take a simple majority to pass, while the parcel tax requires a much more difficult two-thirds approval.
“Chamber of Commerce Executive Director Kemble Pope read the results of a survey of Chamber members on the tax issue that showed 60 percent of respondents said yes to a question about whether the city should keep cutting rather than levying more taxes. ‘I don’t think it is going to fly with the community,’ he said.”
Not so fast, Mr. Pope. If the case can be made that the funds are needed, I’ve yet to see a tax this town won’t approve.
Understandably, those who are in the business of selling things fear any and all tax increases because they raise the total price of the items being sold. And if they raise the price too much, some people will stop buying.
There’s no question that a three-quarter-cent tax increase, as innocuous as that might seem, could have a counter-productive dampening effect on sales in town, but it’s doubtful many people would take their business elsewhere.
The good news for the council is if the case can be made that without this tax Davis will essentially become Woodland, the thing will pass with flying colors. Still, given that a three-quarter-cent tax raises the price of a hundred-dollar item by only 75 cents, I don’t see it having a significant effect on local commerce. Most folks won’t even notice the difference.
For me and my family and our day-to-day budget, it’s the least painful way to go. The saving grace to raising revenue through sales is that if the tax becomes too much for us, we can simply stop shopping. Yes, you do still have to eat, but groceries aren’t taxed.
The parcel tax is a different matter altogether, despite the fact that it’s just $12.50 a month. The bugaboo here is that onerous two-thirds approval requirement, which is a high hurdle indeed, even if the measure promises free chocolate for life for every Davis resident.
Councilman Lucas Frerichs, who has clearly given this measure considerable thought, cautioned his colleagues that as our new water and sewer rates begin their dramatic rise, many Davis residents might have already reached the breaking point and will be unlikely to approve any new taxes before all other budget alternatives have been considered. A serious consideration indeed, as the city moves forward with this.
Fasten your seat belts, folks. And hold onto your pocketbooks. Things are about to get very interesting.

— Reach Bob Dunning at [email protected]

Bob Dunning

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