|Cotati declares fiscal emergency
City to seek extension and expansion of sales tax measure passed in 2010
Cotati officially is in a state of fiscal emergency.
The Cotati City Council at its meeting on Feb. 11 unanimously voted to pass a resolution declaring a state of fiscal emergency in the city. The council’s decision means there will be a strong push by the city’s elected officials and management staff for an extension of Measure A, which was passed by Cotati voters in 2010.
The Declaration of Fiscal Emergency is a statement by the council that revenues and the cost-savings measures that have been implemented are not sufficient to avoid reductions to city services, which impact Cotati’s quality of life and long-term financial viability, the city stated in a press release on Wednesday morning. The council last declared a fiscal emergency in January 2010. Later that same year, Measure A was adopted. As Measure A is scheduled to expire in 2015, the council’s proposal to extend the measure at a one-cent rate will be taken up at its next meeting on Feb. 25.
The measure will appear on the ballot in the June primary election.
Measure A added a half-cent to the city’s sales tax and has been credited with allowing Cotati to maintain its police department. The council and City Manager Dianne Thompson indicated a mere extension would not be enough to pull the city out of its financial straits. When the measure comes up for vote on the June primary ballot, it will call for another half-cent to be added to Cotati’s sales tax.
If Measure A expired and an extension rejected by the voters, the Cotati council, according Thompson, would have no choice other than to implement severe reductions in city services and the potential elimination of the police department.
The city staff, during a brief presentation to the council, had a chart showing projected losses in revenue following the expiration of Measure A should voters reject the tax extension. For fiscal year 2016-17, the loss would be a little more than $1 million. That total would jump to close to $3 million for 2017-18 and near $5 million for 2018-19.
“For the sake of the community and the services our public relies on, we must take steps to protect our financial health and stability,” Thompson said. “The City of Cotati is declaring a Fiscal Emergency to assess strategies to maintain and stabilize city revenues and protect essential city services. Any revenue source such as the extension of Measure A – which is not a property tax, is paid predominantly by out-of-town shoppers, and cannot be grabbed by Sacramento – must be considered.”
The call for the added half-cent drew pushback from some in the audience. Some in the audience, who were opposed to the tax from the start, criticized the city by saying the added tax from Measure A was a reason businesses are reluctant to locate to Cotati. Others who opposed Measure A at the time, indicated the city is not keeping its word concerning the measure. One in that camp is Cotati Jewelers owner Patty Minnis, who led the fight against roundabouts in Cotati in 2012.
“I was told by then-Mayor Robert Coleman (in 2010) that this was going to be temporary and that it was strictly for Cotati to get it house in order,” Minnis told members of the council. “And he asked us not to fight it. He said we would not be asked to renewed this. We (the Cotati business community) are going to fight it. I think you’re going to be humiliated. I don’t think you have a chance.”
Eris Weaver, who is a local business owner and also on the Cotati Design Review Committee, had mixed feelings about the extension of Measure A.
“Overall, I lean toward support for at least extending, I don’t know about increasing the sales tax,” Weaver told the council. “I don’t know what data there might be about the effect of a sales tax increase. My guess is it’s probably not that big. I never had a potential tenant in my building ask what the sales tax was.”
Councilman Mark Landman said one reason Cotati’s fiscal house is in peril is because no one could have predicted the severity of the recession a couple years ago or the slowness of the recovery.
“The economy turned out to be a lot worse than anyone could have expected,” Landman said. “What we’re talking about is recognizing if there is or isn’t a looming fiscal emergency ahead here. Measure A has been brought up a lot. But one thing hasn’t been recognized is that it worked. It did what it said and did what it promised.”