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City Builds Case for Possible Sales Tax Increase

On Monday night, the city manager detailed a range of obstacles Albany faces in handling requests for services and meeting its goals. Click the "Keep me posted" button below for an email when we write about the city budget.

City staff offered a stark view Monday night of Albany's challenges meeting community needs and fulfilling its obligations with a report that sets the backdrop for a possible sales tax increase that could come before voters in November. 

offered her report to the  at its April 16 meeting. 

Pollard also referenced a , which found more than 50 percent approval expressed "for a sales tax to maintain and support City services."

(Editor's Note: Albany Patch has not yet reported in-depth on the survey results, but a story is in the works.)

In developing future fiscal goals, Pollard wrote in her report, "staff identified some areas in which the City was already stretched to or beyond capacity and is not meeting expectations or requirements." 

Pollard said that, since 2008, the city has been shedding staff positions and facing increasingly tight financial times.

As a result, the city has had a harder and harder time meeting community expectations in terms of services and requests.

City staff have thus had a tougher and tougher time avoiding mistakes and moving ahead quickly with projects, she said.

AREAS OF CONCERN

Pollard outlined a wide range of areas where the crunch has been felt most deeply.

  • Code enforcement
  • Homelessness in the city and on the Albany Bulb
  • Technology: Equipment and systems, operations, training
  • Communications between city and the community
  • Public safety
  • Employee compensation: Rising cost of health care and pension benefits, and attracting and retaining talented employees
  • Economic development
  • Planning
  • Sustainability
  • Staff support to advisory bodies
  • Maintenance of buildings, grounds, equipment and facilities
  • Capital needs (Report to come in May)

(For a more detailed explanation about the areas noted above, click the second PDF attached to this story.) 

TAX REVENUE SHORTFALL PROJECTED

Pollard said the city is in the process of planning its 2012-13 budget, and has found several areas of concern. 

A low number of property sales likely will mean low property transfer tax revenue. A decline in sales tax revenue, to the tune of about $200,000, is projected with the and fewer sales at due to competition from the company's Emeryville/Oakland store. The city has had no indication that other revenue sources will increase either, she wrote in her report.

On the plus side, the University of California's Whole Foods and senior housing project has been moving forward; a new is in the planning stages on Eastshore Highway; and the Safeway project once again appears to be underway. 

Pollard noted in her report that all of these projects will benefit city revenues, "but not unless or until (they are) built."

For planning purposes, she wrote, the city estimates that each quarter-cent of sales tax increase would raise about $300,000. Due to other sales taxes levied by the county, Albany could raise the sales tax by no more than half a cent at this time.

RESIDENTS RESPOND

During public comment following Pollard's report, Albany resident and former mayor Allan Maris thanked city staff for their creative and dedicated approach to their work. 

"Hopefully our citizens will realize the conditions and the problems that we're facing and really make an effort to help the city help us as well," he said.

Resident and said she hoped the city would continue to detail its needs, and perhaps add projected costs to each section in Pollard's report to give voters more information about what a sales tax increase might actually pay for. 

"I would like to think that council would like to know how much these costs will be, and will be frank with people about what they are, and are not, going to get," she said. "I am very interested in knowing how much money we really need and where you think that money should go on that list... where there really probably isn't going to be quite enough to pay for everything." 

Resident Peggy McQuaid said that, given the city's challenging financial times, it could be worthwhile to take another look at council health benefits, and how they compare to those offered to city staff. 

(Council members can , for a health insurance plan city staff can pay extra to obtain. The last time Albany Patch reported on this issue, council benefits had  for the most recent fiscal year then available, 2009-10.)

WHAT COMES NEXT

In May and June, council members will review draft budgets to learn more about potential gaps between revenues and needs, wrote Pollard. This will help inform officials and community members about whether the city should place a tax measure, or tax measures, on the November ballot.

Pollard said, in closing, that a sales tax might not necessarily bring new services in the near future, but may simply be needed to maintain what the city currently offers. 

"This may not be about what we can add after a tax is passed," she said, "but recognizing, if there are additional funds in the near- to medium- to long-range future, that we've started a process of thinking through priorities and understanding limitations."

Get an alert when we cover city budget issues by clicking the "Keep me posted" button below. Read more here.

If there's something in this article you think , or if something else is amiss, call editor Emilie Raguso at 510-459-8325 or email her at albany@patch.com.

Trevor Grayling April 17, 2012 at 04:22 PM
The sales-tax, if approved, will still only be a pathetic drop in the bucket. For the upcoming council elections, I'd like to see estimates from all council wannabees on exactly which areas of the budget are short and by how much, not just to "get by," but to make Albany fiscally sustainable going forward. For example, a report last year showed how ill-maintained our roads are and that major, expensive upgrades will be necessary in the not too distant future, due to current lack of upkeep. A comparison of these budget estimates by the candidates would make for a useful, educational, and interesting election; and the results might shock residents as to how far we are actually falling behind.
Dee April 17, 2012 at 07:20 PM
How much city money was spent on the recently completed Pierce Street "bicycle path to nowhere" and the numerous curb rebuilds in the Albany Hill area?
Michael Barnes April 17, 2012 at 08:11 PM
In all my interactions with the city staff I've come away impressed with their competence and knowledge, going all the back to that first passport application with Jackie B. It's been said many times that people pretty much elect the type of government they deserve. Here in Albany, I'd say we have a city staff that is better than what we deserve, especially given how they've been treated lately. I wonder how much longer this situation will last.
John Doh! April 18, 2012 at 12:31 AM
Why didn't the city raise the sales tax on 1/1/12 when the state portion of the tax was lowered? Other cities saw that opportunity and jumped on it. Safeway may happen fairly soon, but Whole Foods will happen much faster if they take the PetSmart location for their proposed mega-store, since it is already zoned for it. It is a much better location to minimize the impact on local streets from commuters driving to San Pablo. The UC Village plan will require: -approval of the EIR, which will probably face a court challenge because of the bad data, -A zoning variance showing the project contributes "an exceptional ammenity," and as is, UC hasn't included anything exceptional to warrant the variance, -A PUD reducing the number of required parking spaces which will may require a city election because it violates Measure D.
Joy Kekki April 18, 2012 at 01:24 AM
Since Albany taxpayers provide the revenue, full disclosure of income and expenses should be provided to us. Financial enigmas such as the "bicycle path to nowhere" and the two new swimming pools that should have been one indicate an inability to handle city funds intelligently. However, a large sign to direct customers to PetSmart (one of Albany's best kept secrets) and avoid its failure would have been a small and wise investment. I think the items in the List of Concerns here are too general. Without definitions and reasons why these items are concerns, the list is meaningless -- unless it is actually a list of binder tabs for a detailed presentation to Albany taxpayers in the near future.
Brian Parsley April 18, 2012 at 02:37 AM
The City has nothing to do with the Albany Pool. The pool was a Albany Unified School District project. The City of Albany and the Albany Unified School District are two different entities with different budgets.
Ross Stapleton-Gray April 18, 2012 at 09:52 PM
Now that Patch seems to lack the "post a short para" feature on the home page, I guess this topic is a suitable place: what's up with the new solar trash cans on Solano? Does Albany really generate enough trash that self-compacting solar-powered trash cans make sense? (The signage claims that this allows for less frequent pickups of denser loads.) A quick googling suggests the solar bins run about $4,000 apiece.
Tim Q. Cannon April 18, 2012 at 10:34 PM
The annual number of sales of homes in Albany is down over the past few years, and that normally provides transfer taxes and higher property taxes based on new assessments that aren't coming in. If people are thinking it's a bad time to sell, they are mistaken. Anyone who's thinking of selling should call their favorite agent.
Joy Kekki April 19, 2012 at 12:41 AM
The funds were derived from Albany taxpayers, who did not vote for two new pools whose cost was more than projected to build and maintain. Reference to the pools and bicycle path merely speaks to the absence of disclosure to and involvement of taxpayers in making financial decisions. In my opinion, there would be fewer surprises and less discontent for all concerned if we were to share the burden of making the budget work -- without blindfolds. Albany could be on top of the "honor roll" in every sense of that term; why be like everyone else?
Michael Barnes April 20, 2012 at 12:27 AM
Joy, this issue has been discussed ad nauseum elsewhere, here is an example that I wrote: http://albany.patch.com/articles/column-the-district-did-pretty-much-what-it-said-it-would-do-with-albany-pools The voters knew what they were voting for, they overwhelming approved the project, and the project came in under budget.
Joy Kekki April 20, 2012 at 03:35 AM
Michael, it's okay...really. Apparently, the pool reference has struck a nerve with you and I could have used another example similar to the solar trash cans on Solano. (Thank you, Ross.) The argument stands; we will simply avoid mentioning pool or pools..
Michael Barnes April 20, 2012 at 06:20 AM
Joy, OK, truce. And thanks. And I agree that there are plenty of other issues that need to be discussed.

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