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A utility tax is OK, but...

Jack Balshaw 6/11/2003

 

A utility tax on our gas and electric bill is probably the most equitable way to generate funds for street improvements. Our use of PG&E resources is most likely related to our overall use of local public streets.

A tax on our PG&E bill will automatically allow for low-income and medical discounts using the PG&E criteria for reduced rates. This will take care of the traditional concern that low-income families aren't considered when such taxes or fees are collected.

Businesses that employ large numbers of people will pay more based on their use of large amounts of power. This will be compensation for the miles driven on our city streets by employees who live out of town and would otherwise not contribute to street improvements.

Utility taxes are fairer than a sales tax or a parcel tax.

In many cities the City Council can impose a utility tax on its own, but in Petaluma, the citizens removed the council's authority to assess such a tax by a charter change years ago. This is part of the reason it will take a two thirds vote by the population to approve such a tax. Only voters can approve a charter change and only voters can rescind one.

My larger concern however is about how the council will make use of revenue from a utility tax. I'm very apprehensive about giving any political body a blank check for a 20 year period. There are too many ways to misuse such authority.

The most likely way is for the city to borrow money today, via a bond issue, using the guaranteed income from a tax as collateral to pay it back. This makes lots of money available right away for instant street repairs but prevents a utility tax from being cancelled if the citizens don't like how it's being used several years down the line.

On the other hand, it's not reasonable to just repair streets year by year on a pay as you go basis as the tax is collected. At the end of the 20 year period, all of the streets that weren't on the original list would be years behind in maintenance and repair. There needs to be a method included in any tax election to allow the public to revisit the matter every four or five years. This is how many cities handle these types of projects. Novato is a nearby example.

I think a method could be found where a simple majority vote of the public could continue or terminate the tax every several years. This would encourage the city to make those repairs the citizens support and not waste money on elaborate improvements such as at Washington and McDowell.

My other major concern is that these funds will be used for more than repairing the existing streets. It will be difficult for the city officials to resist widening, beautifying, and adding things such tree planting and bicycle lanes to any street project.

Widening, beautifying and enhancing streets are commendable considerations but when there isn't enough money to do simple repairs, as present conditions show, spending money for betterments doesn't make sense. Other funds should be used for such betterments.

Any tax approval should contain restraints to require street repairs undertaken with utility tax money be limited to repairs between existing curbs. Otherwise, the above unnecessary expenditures will creep into these projects. The result will be fewer streets brought back to acceptable condition and a request to increase the tax in future years.

The last important condition that should be included in any tax legislation would be a listing of streets by priority groups for improvements. This would result in equitable repairs city wide to keep the most citizens happy. Again, this is how Novato did it.

The longer the council takes to make draft legislation available and the shorter the time citizens have to comment on such legislation prior to the August 5th or so deadline will be an indicator of their willingness to let the citizens be involved in the process. The less time the voters have to discuss the legislation, the less eager they should be to approve it.

Let's hope openness wins out.

 

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