Petaluma Mulls Sales Tax Increase Despite Increasing Revenues
The Sonoma County city of Petaluma is considering a 1% sales tax increase. They're proposing a general tax because it could pass with just over 50% of the vote. A tax used for more specific purposes would require a 2/3 majority.
Why the need for a tax increase when their general fund has actually been growing due to sales from new businesses? From Petaluma 360:
"The city’s $39.5 million budget for 2014-15 shows a general fund growth of about $2.7 million, thanks to increasing sales tax revenue from a slew of major retailers opening. But Petaluma still faces a major general fund deficit by 2017 — mostly due to rising employee pension and health care costs."
Coming to your town soon? Nope. It's already happening in Eureka and any number of other cities and counties across the state.
posted by Fred Mangels @ 12:42 PM
6 comments
6 Comments:
Taxes will continue to rise, pension reform or not. It's the cost of living in the most popular state in the Country.
As long as folks like you accept it. We can't have an ever increasing percentage of people's earnings going to government, especially as is the case now where you get less and less for the money you pay in taxes.
And that's pretty much what's happening across the state now with taxes having to be raised simply to pay for employees when they're no longer working for government.
Besides the Eureka Transaction and Use Tax Fortuna is proposing a 1% sales tax increase along with Rio Dell who is also proposing a 1% sales tax increase. Blue Lake is proposing a 4% utility user tax and Humboldt County has been mulling over a 1% sales tax and a high use utility user tax similar to Arcata's. Most all of this will be before the voters in November.
Yep, and there will likely be more to come. Will we be asked to pass another half or full cent increase in the next few years when the current taxes aren't enough?
Remember that this is just local sales and utility taxes. They're considering raising the federal gasoline tax, too, along with probably others we haven't heard about..yet.
"taxes having to be raised simply to pay for employees when they're no longer working for government."
What's your solution? Deny people the pensions they've been promised and which were part of the calculation they made when they accepted the job and stuck with it all those years?
Going forward, we could reduce the pension benefits offered to new employees, but we still have to pay what's been promised in the past. And, by the way, if you offer less in the way of pensions and benefits, you may have to pay more in base salary in order to attract workers. Maybe that's better, as it's more pay-as-you-go, but in the meantime if we switch to that arrangement we'll basically be paying more up-front for the new workers, at the same time as we're paying more at the back end for retired workers. Might save us money in the long term, but the short-term's gonna be a bitch. So there are no easy answers that, as far as I can tell.
"Going forward, we could reduce the pension benefits offered to new employees, but we still have to pay what's been promised in the past."
That is correct, and we'll be paying for current retirees and future ones for decades, even if we do put future employees on a more sustainable program. Just blowing it off and not addressing the issue, as is being done in many places, just means it will be longer before we get out from under this.
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