Brentwood to Discuss Possible Sales Tax Increase

On Tuesday, the Brentwood City Council will discuss whether or not they want a report from staff on why a sales tax measure could be needed and the impact on the average resident.

The future agenda item request was made by Councilmember Jovita Mendoza at the March 26 meeting related to a report from staff on a possible sales tax.

“Tim (Ogden) has brought up three times now about a sales tax, so I think what I would like to see a report of why you need a sales tax, what the money would be used for and what the impact would be on the average resident,” stated Mendoza. “I know its come up a few times, so lets talk about it. Lets see if its something we are on board with and if not we can just squash it ongoing.”

Approving bringing back a report on a sales tax would be the first step in a long-process that would include the council even agreeing to move forward with one–which no one on the council had any appetite for new taxes as stated in its January 26 meeting. If the council did bring the item back, they would then have to agree on what a sales tax measure would look like, get community feedback, then agree to even place it on the ballot.

According to the agenda item:

Potential uses of sales tax revenue funds and impacts to residents could be developed for discussion should the City Council direct staff to spend staff time and resources on this item. There would be no outside costs associated with this activity. If the City Council is interested in pursuing a sales tax, however, there is insufficient time to successfully add such a measure to the ballot in the current election cycle (November 2024).

Potential sales tax measure revenues could range from $3 million to $12 million annually, depending on the proposed sales tax rate. Potential costs in pursuing a sales tax measure would involve staff time and consultant costs for community outreach, surveying and educational efforts, which would only take place following City Council direction to pursue a measure. Funds could be dedicated to a range of projects, or programs, depending on the City Council’s direction.

In a March 26 email to the city council, Brentwood City Manager Tim Ogden admitted the council did not want to do a sales tax, but provided details of nine recent sales tax measures which 8 passed from around the state:

• Benicia – ¾ cent – passed with 67.2%
• Santa Cruz – ½ cent – passed with 61.7%
• Westminster – ½ center – passed with 61.2%
• Chino – 1 cent  – passed with 60.2%
• Ponoma – ¾ cent – passed with 60.1%
• La Canada Flintridge – ¾ cent – passed with 54.8%
• County of Santa Cruz – ½ cent passed with 54.6%
• Grass Valley – 3/8 cent – passed with 50.2%
• Bell – ¾ cent – failed with 49.6%

Current Sales Tax Levels in Contra Costa County effective January 1, 2024:

Jan 23 Meeting Tidbits

At the January 23 meeting, Brentwood Reported its January 2024 mid-year projection for the general fund was a $1 million surplus—after the 30% general fund reserve was met. They now also project a 2023/24 surplus of $500k.

Meanwhile, the general fund reserve and budget stabilization balance jumped from $23 million to $31 million—peaking in 2025/26 and drawn down over next several years as expenses exceed revenue by $1.7 million per year.

At the meeting, Jovita Mendoza stated she did not want to charge residents any more taxes but was willing to listen.

Staff presented a summary of various methods of how general fund revenues could be increase:

• Sales Tax Measures – $5 to $10 million per year (½ cent to 1-cent)
• Utility users tax (UUT) – $3 to $5 million per year
• Parcel Tax – $3 to $5 million per year (more common for schools)
• TOT (Hotel Tax) – increases from 10% to 12% is $150k per year
• Business License – 20% fee increase is $150k per year

Other ideas:

• General Obligation Bond – customizable, capital projects
• Grants – varies with the grant
• Anaergia Project – Preliminary estimates $5 million per year
• Cannabis Taxation – no estimate
• Reserves – 10% decrease in reserve – $7.5 million in one-time funds
• GF/Revenue Bond – need new revenue source first, capital projects

After the presentation, Mendoza again stated she was not in favor of any tax increases.

“I am not in support of any tax increase,” stated Mendoza. “Our residents pay CFD’s for fire and police and it is a lot of money. Its more than what other people pay and I think they are heavily burdened in Brentwood with their taxes. I don’t want to increase their sales tax either so I hope they get a little tiny break from all the property taxes and they just approve Measure X and we are not seeing anything with Measure X. Nobody is doing anything for us in Brentwood and we are all paying that tax. Unless, it was specifically earmarked for something.”

She then stated that Brentwood had been on “developer crack” and they needed to get off it and now had to learn to live within its means.

Vice Mayor Susannah Meyer stated she could not imagine making any changes to the business license tax. She said with Measure X, the money was going more towards social services and not directly to the City of Brentwood. She did not believe there was no appetite for a sales tax increase.

“Most of these, I could see being a major problem with our residents,” said Meyer.

Councilmember Pa’Tanisha Pierson stated if they were trying to encourage more hotels to build in the city, they don’t raise taxes, they don’t raise the cost of a business licenses. She was in favor of finding more creative ways to raise money than to tax people.

“I am so anti-tax,” said Pierson.

Councilmember Tony Oerlemans shared he was not in favor of raising taxes but would be in support of setting money aside now for general plan update as soon as they could.

Mayor Joel Bryant agreed with all the previous comments and wanted to have funding in place ready when they needed it. He also said taxes were a “four letter word” and have an opportunity to withhold a tax decision for a few years.

If you go:
April 09, 2024 at 7:00 PM
150 City Park Way Brentwood, CA 94513
Agenda – click here