The La Cañada Flintridge City Council received updates and progress regarding the city’s opportunity to increase its sales tax, moving along in its process of joining the Clean Power Alliance and the city’s housing element at its Nov. 21 meeting.
The council unanimously approved three resolutions and a first reading of an ordinance to put a proposed sales tax increase of 0.75% on the March 2024 ballot for residents to vote on. The current sales tax in the city is 9.5%, with only 1% going directly to LCF.
City Manager Daniel Jordan and the city’s Public Education Consultant Robb Korinke presented the staff report to the Council and community.
In the last six to seven weeks, Jordan and Korinke have been working to get the word out to various commissions within the city and community members about the city’s stance on raising the sales tax.
Korinke presented information regarding the outreach they have been doing and the responses they have received from residents.
“The city has hosted a series of 15 virtual and in-person community presentations over the last month,” said Korinke. “These meetings provide an overview of the city’s budget process and described how funding is allocated or appropriated to various city services.”
The survey that was on the city website received more than 110 responses from residents in November, in which they ranked the importance of various city services from low priority or 1 to high priority or 3.
“The top three responding issues were all public safety related,” said Korinke.
The top three issues that residents listed as high priority include: preventing crimes, thefts and burglaries, maintaining 911 response times, and responding to wildfires and natural disasters.
Lower rated issues included: supporting senior programs, retaining and attracting local businesses and supporting youth and after-school programs.
“We [also] talked about what the city’s budget is and that it has a $54 million total budget, but that there is also a general fund as part of that, that is just $19 million, and that funds some of the core services in the city, like public safety,” said Korinke.
He also added that half of the general fund revenues come from property tax and the second highest sources of revenue comes from the city’s sales tax.
“[The city’s] sales tax rate has not changed in 47 years, since that city was founded in 1976,” said Korinke.
Korinke said that if the Council took a super majority vote to bring the revenue measure to the voters, “it would preserve funding for anything funded by the general fund, like public safety and emergency preparedness.”
He compared LCF’s sales tax rate to other surrounding cities like South Pasadena, Alhambra, Burbank and Glendale, which have a rate of 10.25%. The rate in Pasadena is also 10.25%.
LCF is currently tied with about 30 other cities in Los Angeles County, such as Los Angeles with a 9.5% rate.
Korinke also broke down the percentage of money LCF is getting back from the sales tax rate currently.
“Six percent would go to the state of California, 2.5% to the county of Los Angeles and just 1% of the 9.5% stays locally here in La Cañada Flintridge,” said Korinke.
If the city raises its sales tax, “it would generate an estimated $2.75 million annually and 100% of those funds would stay locally in La Cañada Flintridge,” said Korinke, adding that it would give the city 1.75% of revenues back rather than 1%.
Accountability measures would be in place as well, according to Korinke, which would include annual independent audits, expenditure reports available for public review and making sure that all funds raised will only be used for LCF services.
“It was a very long process,” said Jordan, who reiterated resident concerns about public safety, road maintenance, pedestrian safety and public recreation opportunities.
Community members at the meeting spoke in favor of the possible increase in sales tax.
“No one wants to pay more taxes,” said LCF resident Julie Kane-Ritsch. “No one wakes up in the morning and says, ‘gee I hope they raise my taxes today.’ But taxes are what allows our government to provide the vital services that our community needs to pay and fund for those award-winning schools that we all moved here to be part of and to keep our town habitual.”
“It’s very clear that our needs in the city exceed the budget that we have and the revenues we are receiving,” said Kane-Ritsch, adding that she would rather see the additional money go to the city and not the county if they don’t raise the sales tax.
LCF resident Stephanie Fossan also spoke up and said that she heard about 30% of the revenue would come from people who come into La Cañada to do their shopping and said it could be motivating for community members to understand that “we might be getting more bang for our buck.”
“I think La Cañadians think this town is pretty great,” said Fossan. “So, I just want to make sure that we are painting a picture that is both true to form and shares our challenges but also doesn’t leave people with an impression that things are worse than they are.”
The Councilmembers gave their remarks, with Mayor Pro Tem Michael Davitt saying that the increase would give the community an opportunity to express their opinion, “whether they think this is a valid process to do or not.”
As part of the sales tax subcommittee with Councilman Keith Eich, Davitt said, “We believed it was important to move it forward to this point.”
A second reading of the ordinance will be conducted after the election, if voters approve the sales tax, said City Attorney Adrian Guerra.
SECOND READING OF CLEAN POWER ALLIANCE
City Management Analyst Jeannette Klein provided an update to the City Council regarding the city’s membership in the Clean Power Alliance during the Council’s second reading of the ordinance, which resulted in the Council unanimously approving it.
Klein addressed previous concerns that the Council had on public outreach about the possible change in services.
“The city’s website will be updated to include videos and other resources about Clean Power Alliance and the Community Choice Aggregation,” said Klein, adding that the city will utilize social media, its website and newsletters to keep residents informed of town hall meetings and the city’s membership with the Clean Power Alliance.
She also talked about changes in rates when the city does partner with the Clean Power Alliance.
“CPA customers may be directly impacted by changes in their rates,” Klein said. “As a reminder, CPA rates are competitive compared to SCE.”
As for potential long-term liabilities, “The city will be more involved in providing electricity to residents and businesses.”
If the city wanted to withdraw from the Clean Power Alliance, Klein said there are three categories of liabilities that can be expected.
- Cost of clean power contract commitments made by CPA for the city, “which will be in the millions.”
- SCE’s administrative re-entry fees, “which should not be a major cost.”
- Cost for consultants and legal experts to assist the city in the withdrawal.
“My understanding is that if we don’t pass the second reading tonight, we will have to wait an additional year, even if we vote in January,” said Eich, and asked what resident liabilities would look like if the city went back to SCE.
Klein responded and said that there could be minimal liability costs on residents’ rates.
Davitt said that power outages have increased in the city and asked what that would look like in the city and who residents should call in the case of one.
Klein said that SCE would still be responsible for handling outages.
CEO of Clean Power Alliance Ted Bardacke assisted Klein in answering questions and provided some clarity for the Council.
Rates are put out every year during June and take effect in July, Bardacke said, and that the city-appointed member will be involved in that process.
Eich further asked what plans Clean Power Alliance have in place to engage with JPL.
“The launch of service in a new community is always the riskiest times for us from a risk management perspective, because we don’t how many people are going to opt-out, and we are buying power ahead of time,” said Bardacke, adding that JPL is a significant power user.
Mayor Rick Gunter said he is excited for the partnership and thinks it would benefit the LCF community.
“Our joining the CPA means that our residents now have a choice in electrical providers. They can choose to be with the Clean Power Alliance or they can choose to be with SCE,” said Gunter, adding that the city can now provide some input on the rates that are set, “because currently we have zero [with SCE].”
LCF resident Kane-Ritsch said the city is doing the right thing by joining the Clean Power Alliance.
“By voting today to join the Clean Power Alliance, the City Council demonstrates through its action that it’s serious about doing its part to reduce greenhouse gas emissions in La Cañada,” said Kane-Ritsch.
Director of Community Development Susan Koleda informed the Council during the closing comments that the city received a letter from the California Department of Housing and Community Development saying, “That our housing element is in substantial compliance with state housing law, so we are done with the housing-related items for a couple of years.”
First published in the November 30 print issue of the Outlook Valley Sun.