Arguments for and against increasing transactions & use tax from 1% to 2% (Measure Q)
August 19, 2024
By Roberta Millstein
This November, Davisites will vote on Measure Q:
To support essential City services, such as public safety and emergency response; crime prevention; pothole repair; parks, road, sidewalk, and bike path maintenance; and addressing homelessness, affordable housing, and climate change, shall the City of Davis's Ordinance be adopted establishing an additional 1¢ sales tax providing approximately $11,000,000 annually for general government use until repealed by the voters, subject to annual audits, public disclosure of all spending and with all funds staying local?
This would increase Davis's current retail transactions and use tax from 1% to 2%. To pass, a majority (50% + 1) of the votes cast by City of Davis voters must approve the measure. As implied by the text above, the tax has no automatic sunset date; it will be in effect until repealed by voters.
Further details are available at the County's website: https://ace.yolocounty.gov/417/Measure-Q---City-of-Davis
Here is the argument in favor that will appear on the ballot:
Measure Q is critical for the health, safety, and financial stability of Davis. While our community has grown and costs have increased, revenue for city services haven’t kept pace. To maintain our quality of life, Measure Q is vital.
Yes on Measure Q would ensure that Davis emergency responders are able to meet current needs—providing police and fire departments adequate resources to improve emergency response times, retain trained personnel, upgrade equipment, and provide proper training.
Yes on Measure Q will help improve park maintenance, greenbelts, and landscaping, and support upgrades to our aging public infrastructure (filling potholes, and repaving streets and bike paths).
Yes on Measure Q helps address homelessness and affordable housing. Measure Q funding will allow us to connect individuals with support systems and collaborate with local organizations on effective housing solutions.
Yes on Measure Q allows Davis to be regionally competitive with neighboring cities also adopting similar measures.
While providing the approximately $11,000,000/year necessary for maintaining our essential city services, Measure Q proposes a modest 1% increase in local sales tax (just one penny on each dollar spent on taxable goods).
Measure Q funds can’t be taken by the State, guaranteeing that all revenue remains in our community. Essential purchases like groceries and medicine are exempt. It was important to ensure that this measure would not be a burden to those on fixed incomes.
The City of Davis has worked diligently to manage existing resources efficiently, trimming expenses while protecting residents’ services and staff positions. Now we need to catch up to inflation, increasing costs, and our growing population.
Thoughtfully developed, Measure Q is an investment in our community’s future, ensuring that Davis remains a safe, vibrant, and welcoming place for all.
Please join community leaders, like the Davis Downtown Business Association, in supporting a safe, financially stable, resilient future for Davis —Vote Yes on Measure Q.
/s/ Lois Wolk
Former Davis Mayor/s/ Robb Davis
Former Davis Mayor/s/ Brett Lee
Former Davis Mayor/s/ Gloria Partida
Former Davis Mayor/s/ Lucas Frerichs
Former Davis Mayor
Here is the argument against that will appear on the ballot:
The Davis City Council conveniently blames our fiscal problems on recent inflation and unspecified “additional services”, but is pushing to increase taxes FOREVER.
The real problem is our Davis City Council has irresponsibly granted excessive salary increases to Senior Management and Firefighters while the city is in dire fiscal straits. The latest salary increases, granted by the current Davis City Council, will cost taxpayers millions of dollars over the coming years.
Together with past salary increases far in excess of inflation, every bit of the new taxes is consumed going forward. Regrettably, the Davis City Council has NOT been honest and transparent about this.
Further, just in the past year:
- The Davis City Council reduced the annual budget to repair our crumbling streets by $1.5 million.
- The Davis City Council suspended paying down $42 million in unfunded employee healthcare benefits, leaving our children to pay.
- Our General Fund reserve has shrunk to 7.5%, which is half the desired 15%.
- The Davis City Council is 3 years behind in providing audited financials.
- The Davis City Council refused to appoint Commissioners to our independent oversight Finance and Budget Commission so it could not legally meet for over a year, and it never once discussed the need for nor the anticipated uses of this new tax.
Our Davis City Council is out of control with no plan to rein in costs. Instead they referred to new programs and services, while continuing to spend our tax dollars on exorbitant salaries. We simply cannot trust them with more of our money until appropriate oversight and controls are implemented.
Say NO to irresponsible spending that has gone off the rails. Tell our Davis City Council that there will be NO more money until they 1) create a plan to use our tax dollars wisely, 2) stop the runaway escalation of employee compensation, and 3) implement independent financial oversight controls.
Vote No on Measure Q – Quit Wasting our Taxes.
www.NoOnDavisMeasureQ.com
/s/ Elaine Roberts Musser
2014 City of Davis Citizen of the Year; Former Chair, Utilities Commission; Former Chair, Senior Citizens Commission/s/ Mark Mezger, President
Yolo County Taxpayers Association/s/ Jeff Miller
Former Chair, Davis Finance and Budget Commission/s/ Jeff Boone
Davis Resident & Downtown Business Owner/s/ Alan Pryor
Treasurer, Yes on Measure D – 2012 Davis Parks Tax Renewal;
Principal Officer, Yes on Measure O, 2014 Davis 0.5% Sales Tax
The rebuttals to the for and against arguments are in a separate post, here: https://www.davisite.org/2024/08/rebuttals-to-arguments-for-and-against-davis-tax-increase-measure-q.html
Yes on measure Q- better than another parcel tax and much more fair as shared by all.
Posted by: Sean Canary | August 19, 2024 at 11:07 AM
Sales taxes are inherently regressive and disproportionately affect lower income residents which include 25% of Davis' population because of the large student and fixed income seniors. In other words, a poor person pays a much higher percentage of their income towards sales taxes than rich folks.
For all the talk of how much this current City Council cares about poor folks, they seemed tone deaf when they had an option of putting forth a parcel tax based on property valuation instead of picking a regressive sales tax. But I guess the sales tax does seem the better option if you happen to be rich and/or own or live in expensive single family homes as do all of our current Council members...not so much, though if you're a struggling worker, student, or fixed income senior.
Posted by: Alan Pryor | August 19, 2024 at 11:48 AM
Don't forget that people are already paying all these other extra taxes and fees (of the ~50% of their earnings they get to keep after federal, state, FICA and other taxes are taken out of their paychecks).
https://www.cdtfa.ca.gov/taxes-and-fees/special-taxes-and-fees-tax-rates/
The list linked above has the $1.75/tire "fee" I paid earlier this year (above and beyone the ~$20/tire state and local "sales tax"). The list is missing the new paint and lumber fees (that ara also above and beyone any tax) I recently paid.
It seems like firguring out how to save money and be more efficiant is a better idea that anskign people already getting killed by inflation and high engegy costs to pay more for everything they buy (or have shipped) to town.
Posted by: South of Davis | August 19, 2024 at 01:17 PM
I have no doubt that the City needs money. However, they have given us little reason to think they will use that money wisely. The G Street Gaffe (as Bob Dunning calls it) is only the most recent example showing how poorly run the City is, both in terms of staff and lack of oversight from the City Council. If you haven't heard of the screw-up, I can't do better than refer you to Wendy Weitzel's excellent column, here: https://www.comingsandgoings.news/p/g-street-transformation-will-begin . The City has backed down from that plan, stating that there was confusion/misinformation (doubtful) but it's still really unclear what will happen on G Street and if it will end up being a worst case scenario: no cars on the street, harm to local businesses, and a poor place to hang out. This echoes other decisions like the Bright Night debacle, the unneeded fire-ladder truck, and the Mace Mess. So, while I am happy to pay my share and lucky that I am able to do so, I'm not sure that I feel like dumping my money into ill-thought out decisions.
Posted by: Roberta L. Millstein | August 19, 2024 at 01:20 PM
Truth be told, this potential sales tax increase is absolutely irrelevant (completely "dwarfed by") parcel and CFD taxes charged by the school district (DJUSD). No comparison at all, in regard to amounts charged. Not even close.
Also, parcel and CFD taxes/fees are HOUSING costs. The same costs that DJUSD claims are "insufficient" and which are preventing their own "customers" from moving to Davis.
Posted by: Ron O | August 19, 2024 at 02:56 PM
"much more fair as shared by all. "
Have you heard of the concept of a 'regressive tax', SC?
Posted by: Alan C. Miller | August 19, 2024 at 03:26 PM
“Measure Q allows Davis to be regionally competitive with neighboring cities also adopting similar measures.”
Usually being competitive means keeping costs affordable compared to others, not trying to raise them to keep up with the Joneses.
“Measure Q proposes a modest 1% increase in local sales tax.”
Isn’t doubling the local sales tax from 1% to 2% actually a 100% increase?
“The City of Davis has worked diligently to manage existing resources efficiently, trimming expenses…”
From the outside, looking in, it appears much more could be done to manage resources and improve efficiency.
“…while protecting residents’ services and staff positions.”
The last two words are telling. Measure Q’s primary goal seems to be to protect staff positions. As salaries get inflated, higher productivity should be expected and required from each employee, thereby reducing the number of employees needed to run the city. In the public sector, expenses, including salaries, should never exceed revenue.
“Now we need to catch up to inflation, increasing costs, and our growing population.”
Since sales tax is a strict percent of purchases, as prices increase due to inflation, the tax revenue for every taxable purchase should increase proportionately. Same with increasing population: more people spend more money and therefore generate more tax revenue.
Posted by: Jay | August 19, 2024 at 04:04 PM
I wish more people like Jay would run for city council rather than the people we currently have to work to increase taxes just to "protect staff positions" while working to get more development to "protect school staff positions".
P.S. Does anyone know if the city is staill paying someone to lock and unlock the noisy playground "Sky Track" near the former city council membes home every day (or if the lawsuit about the noisy "Sky Track" was ever stttled)?
P.P.S. I did try Google and did not have any luck but I missed Alan sugesting that we "should we change the name of Arroyo Park to the "City of Davis Government Waste Interactive Museum""
P.P.P.S. A new slogan could be "Give the city more money to waste, vote to double the sales tax ad on"
Posted by: South of Davis | August 19, 2024 at 09:41 PM
One thing that I believe South of Davis pointed out is that when purchasing a big-ticket item (like a new car), the purchaser pays sales tax based upon their city of residence - and not where it's purchased.
Just looked online, and that appears to be accurate.
https://www.cdtfa.ca.gov/formspubs/pub452.pdf
In such cases, a 1% increase in sales tax would be somewhat significant.
(I don't know if that applies regarding business-to-business purchases, e.g., - for equipment.)
Posted by: Ron O | August 20, 2024 at 09:07 AM
If you live "South of Davis" (or in El Macero) you pay 7.25% when you buy online or buy a new or used car (since in CA the sales tax rate is based on the adress an item is shipped to and on the address where the registration is sent not where you "buy" the car). If measure Q passes the sales tax for people buying a car in Davis will be 9.25%. That means that the people that live in Davis will pay ~$1,800 MORE for a Tesla Model S Plaid than the people that live "South of Davis" (or North of Davis between Davis and Woodland).
P.S. If the people of Davis vote for measure Q to give more funding to the "City of Davis Government Waste Interactive Museum" they will not only see more $1K picnic tables and $500K shade structures but many will also pay "more" in "sales tax" for a new car than I paid in total including the sales tax or my first car (a Plymouth Valiant with a "slant six")...
Posted by: South of Davis | August 20, 2024 at 11:23 AM
“I wish more people like Jay would run for city council rather than the people we currently have to work to increase taxes just to "protect staff positions" while working to get more development to "protect school staff positions.”
South of Davis, That’s flattering, but seeing that all 5 current council members signed in favor of measure Q and no current or former elected officials signed the rebuttal, my opinions would likely be very unpopular in an election. That is, unless Davis voters finally start saying “enough is enough” with regard to taxes. It almost happened in the March election when the DJUSD tax Measure N passed by a margin of 335 votes out of 21,282 votes cast. But that was a much higher hurdle to passage (67%) vs. the 50% hurdle for a general tax increase like in Measure Q.
Posted by: Jay | August 20, 2024 at 11:33 AM
"... allows Davis to be regionally competitive with neighboring cities also adopting similar measures."
How does raising the Davis sales tax make us more competitive with cities who are raising theirs?
Even if ours is then just even to theirs, we're not "even" because of the cost of (transportation, time, etc.) of buying there instead of here.
I shop for things that sometimes I can get here, but sometimes are only reliablely found in the Bay Area. So due to the Bay Area's high taxes, I try to buy them here.
And there is still no guarantee that the existing taxes, let alone the increase, will be spent for the listed programs (or any priorites for which programs) since it would go to the general fund.
Posted by: Valerie Vann | August 22, 2024 at 01:11 PM