After months of contentious debate and pleading from some residents, Lompoc is moving forward with holding a sales tax increase election in 2020.
Lompoc City Council unanimously approved taking the first step toward an election at a special meeting on Aug. 22. As the city worked on its 2019-21 biennial budget, the council majority expressed concerns about putting a sales tax measure on a future ballot.
While trying to resolve a nearly $3 million deficit in the budget, three council members had rejected city staff’s recommendation to balance the budget based on a projected revenue from a sales tax election. Instead, the council approved a budget with reductions, including the elimination of several staff positions, in late June and said it would revisit the idea at a later date.
At the Aug. 22 meeting, Councilmember Victor Vega said the decision to move forward with a sales tax election isn’t a turnaround from the council’s previous position. Council members just needed to deal with the budget and look at all possibilities first, he said.
“I think it was assumed that no one was in favor of putting a tax on the ballot, but that’s not what this was about,” Vega said. “This was here so we could fully vet for the public any and all other courses of action.”
The council’s motion at the meeting was the first step in calling for an election. At a future meeting, the council would have to unanimously declare a fiscal emergency and call for an election with a four-fifths vote. To place a sales tax election on the March 2020 ballot, the city must deliver all necessary paperwork to Santa Barbara County by Oct. 24.
If voters approve the 1 percent increase, the new rate of 8.75 percent would go into effect in July. The city would begin receiving revenue from this increase in October 2020, City Manager Jim Throop said.
The city estimates the new rate, if approved, would generate an additional $5 million annually. Initially, some of this revenue could be used to address the city’s immediate fiscal needs, but eventually all of the funds would be dedicated to the city’s pension obligations.
Mike Meyer with NHA Advisors presented the city with an update on its existing pension debt at the beginning of the Aug. 22 meeting. According to the presentation, the city owes $93 million to the California Public Employees’ Retirement System (CalPERS) and its annual payment continues to increase.
Lompoc Management Services Director Dean Albro said the city’s minimum annual payment will soon be $3 million, but it will peak at $7 million. If approved, the tax measure would leave the city with some additional funding in the short term, before all of the revenue generated by the increase gets dedicated to pay off CalPERS.
“We’re not going to have an abundance of money coming,” Albro said. “We’re just going to be able to put our service levels back to where they should be and be able to take care of some of our issues that we need to take care of.”
The council indicated that some of the money could be used to fund three police officer positions that the city has held vacant since the 2017-19 budget. But overall, Lompoc Mayor Jenelle Osborne said she wanted to be clear that this tax wouldn’t change much of the city’s service levels.
“Any wiggle room is going to go to supporting those that we’ve held back on,” Osborne said. “Once that’s done, it sounds like there’s nothing else left. I want to be careful that the community doesn’t think [the tax is] going to be releasing a great deal of funds long-term to address other issues we all know we have.”
—Zac Ezzone
This article appears in Aug 29 – Sep 5, 2019.
