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San Ramon voters are likely to see a new local measure on the ballot in November’s election, with officials making moves last week toward pursuing the possibility of a sales tax increase aimed at addressing the city’s budget woes.
The San Ramon City Council voted unanimously at its regular meeting on June 25 to direct staff to draft a resolution to place a 1% sales tax increase on the ballot for local voters in the upcoming general election following an informational presentation of data on the feasibility of sales tax measures being passed.
At the same meeting, councilmembers approved their final budget for the 2024-25 fiscal year, which included $8.1 million in budget cuts across the city’s divisions and services and served as the culmination of months of lengthy and arduous discussions about the city’s ongoing structural deficit.
The city’s relatively bleak financial forecast was a topic that returned to the table during and after the presentation on potential sales tax measures, garnering a range of public comments from residents and voters, including several members of a newly formed residents’ group advocating for a sales tax increase in the city.
“Cities are ultimately mission-driven, and that mission is to deliver the highest quality services possible to residents at a reasonable cost,” said Robert Levy, who identified himself as a lifelong San Ramon resident and treasurer of the new citizens group. “In that respect, I know that San Ramon has done so many things right.”
Levy pointed to the city’s history of balanced budgets, high credit rating, small reserve policy and “fairly lean staff” for a city of San Ramon’s size.
“Any city has items that are nice to have or want to have, as well as must-haves or needs, and for what it’s worth I think the city has done an excellent job in prioritizing the must-haves and the needs particularly when it comes to public safety, library hours and its support for parks and community services,” Levy said.
“But with everything that I’ve learned, I’ve come to the conclusion, as have the others, that without additional revenue that even if we cut everything non-essential that we can and squeeze staff to the absolute limit, not only will that lead to a reduced quality of life that I think most residents will find entirely unacceptable, but the cost of the things that the city absolutely has to do and must have will just continue to increase and exceed the revenues of the city,” he continued.
A total of four members of the group spoke during the public comment period, calling for a 1% sales tax increase to be put up for consideration on November’s ballot along with language specifying resident oversight and engagement of the funds generated should the measure pass.
While a majority of the eight public speakers at last week’s meeting voiced their support for a sales tax measure, former San Ramon mayor and councilmember Greg Carr said that to seek a measure – such as the half-cent sales tax measure the Pleasanton City Council recently voted to pursue – would only be “kicking the can down the road.”
“My view is that before you go ask the people for a percent tax you try to exhaust every other possibility, and there are more staff cuts that could be done, there are more things that can be tabled but we’re going straight to the sales tax,” Carr said.
Carr noted that although Pleasanton’s sales tax rate was higher than those in Danville and San Ramon, the San Ramon Valley’s southern neighbor is still facing financial challenges that caused them to pursue a sales tax increase in November. He also pointed to the recent failure of the two parcel tax measures from the San Ramon Valley Unified School District in a special election on May 7 as reason for concern that placing a measure on the ballot might only waste the city’s limited funds should it not be approved by voters.
“It might not be money well spent until the people can be shown that the council, the staff, everybody has exhausted everything and cut it to the bone,” Carr said.
Two of the speakers following Carr objected to his call to “cut it to the bone,” including fellow mayor emeritus Bill Clarkson, who emphasized the value residents place on existing services.
“About 70% of your expenses you spend just on public safety, infrastructure and your parks,” Clarkson said. “If we have these kinds of cuts come to our city, if we don’t have the sales tax measure passed, you’re looking at making cuts that are going to make substantial inroads on public safety, on our infrastructure, on our parks.”
In their subsequent discussion ahead of providing direction to staff, councilmembers also voiced their support for pursuing a 1% sales tax increase
“There are things that are out of our control – inflation is out of our control, so obviously that has caused an increase in certain operation costs and we are solely responding to that,” Councilmember Marisol Rubio said. “I think we also know that deferring on maintenance costs, especially with public works and parks, that’s going to cost us more in the long run. We don’t want that.”
“If we’re trying to be responsible in terms of how we run the city, if we want to keep costs down, that means we need to do something about it so that we can take care of it sooner than later,” she continued. “As was mentioned earlier, a 1% increase will still keep us lower than other comparable cities in terms of where we fall on the sales tax bracket, and I just think philosophically we cannot continue to operate from behind and expect good outcomes. That just doesn’t exist. We have to be realistic.”
Vice Mayor Mark Armstrong also pointed to San Ramon’s relatively low tax rate compared to neighboring cities – 8.75% overall – and the value residents place on maintaining existing services.
“Residents have come to expect some pretty high delivery of services, and I don’t know how the staff has done over the years, but they do,” Perkins said. “We’re doing a great job and they’ve done a tremendous job with what we have, but again costs are only going up.”
“We’re no longer a medium-sized city,” he continued. “As we’ve grown we’re into a large-city category, and we’re still on more of a medium-city revenue budget if you will, and I do think that our residents will support a tax increase if given the information. If they just see it on the ballot they’re going to be like most of us – if somebody wants more money out of me, my first reaction is I’m against it. But if ahead of time I have the right information or I do the right research and get information and it’s credible information, not a bait-and-switch kind of thing, then I think our residents will support it.”
Councilmember Scott Perkins made a motion to direct city staff to return to the council with a draft measure for a 1% sales tax increase that would expire in 10 years, and to seek to mention citizen oversight mechanisms in consultation with the city attorney.
“I would include it because there will be people who will find that reassuring,” Perkins said.
The council voted 5-0 to approve the motion, with the item set to be on the agenda at an upcoming meeting. The next regular City Council meeting is on July 9.
In the past sales tax increases have been earmarked for specific purposes. Now Pleasanton, San Ramon and Santa Barbara are proposing increases to go to the general fund. Where will this end? There will be no belt tightening and next year we will hear the cry for more funds.
The 70% spent on parks and infrastructure accrues because of growth. We have over 65 parks, two pools, who knows how many parkways, traffic lights, streets to maintain, over passes for bikes, two water structures,etc.. When Windermere and Bishop ranch was to be planned for construction the City did not want to do the engineering so they passed it to the county. The county in turn took the property tax revenues. San Ramon said we will just take permit revenues. I wonder if they made this same arrangement with all the present housing going on? This is water over the bridge. The point now is that the city wants to be the leader in high density housing in the county. Numerous parts of the city are being removed to build over growth. Guess what our financial and logistical future is going to look like with all the additional people here? The thing that really gripes me is that there is no push back to the housing numbers. San Ramon is headed to look like and have the same financial future as Dublin. Time for the residents to push back.