No "TOT" Increase - Elections Cloud Judgment
GUTLESS "RECEIVE AND FILE"
Tuesday night the Costa Mesa City Council voted unanimously to simply "receive and file" Linda Dixon's request and accompanying staff report requesting that an increase in the Transient Occupancy Tax (TOT) be placed on the November ballot. That means no further action will be taken on this subject this time around - again. That motion was made by Allan Mansoor and seconded by Eric Bever.
BYRON NAILS IT - AGAIN
Byron de Arakal, in his column today on this subject, really nailed it. You can read it HERE.
I won't go into the details of this issue - I covered it in my previous entry and many people chose to provide their comments on it - except to observe that the staff presentation was a shorthand version of the discussion held at the Study Session last week. I doubt that audience members not previously privy to the details of this subject would have understood what this was all about from tonight's presentation.
THE MAJORITY IGNORES THE PROFESSIONALS - AGAIN
Once again, the majority on the City Council have chosen to ignore the wise counsel of their senior city staff, including City Manager Allan Roeder and Finance Director Marc Puckett, on an issue that will have a long-term impact on the future of our city. Roeder and Puckett and their staffs have, for decades, effectively played a shell game with the city's finances, using the Fund Balance from the previous year's budget to balance the new one. Don't get me wrong - that's not a criticism, it's a statement of admiration. It's hard for me to imagine a municipal budget being more effectively managed.
DECLINING REVENUES REQUIRE ACTION
However, with the decline in sales tax revenue and the uncertainty of the property tax revenue stream because of the current worsening loan crisis, it is clear from all indicators that those two segments of our municipal revenue stream will fall well short of their budgeted levels. The two segments combined make up 70% of our municipal revenue stream.
TOT INCREASE WOULD HAVE EASED THE IMPACT
The proposal by Dixon, which was heartily supported by Roeder and his staff, to place before the voters a modest increase in the TOT in November would have - if approved - dovetailed nicely in the spring with the anticipated decline in revenues. The TOT is a tax felt only by visitors to our city and ours is currently the lowest in the county.
When it was clear that the Bever-led majority was not about to approve placing a TOT increase on the ballot, nor were they interested in tinkering with the business license fees, Katrina Foley and Dixon voted with the majority to blow off this plan. It is an election year, after all... I find it very curious that the city council had such low regard for the opinions of the voters that they wouldn't trust them to make a wise decision on this tax increase in November, so they just refused to place the question before them.
CHICKENS COME HOME TO ROOST IN THE SPRING
Next spring, as the city begins preparing it's next budget, the chickens will come home to roost. It will be very interesting to see what kind of a waltz our elected leaders do to shrug off the responsibility for the difficult financial times ahead. I'll remind you of their vote tonight when the time is appropriate. As Allan Roeder reminded the council tonight, when revenues fail to materialize it won't be a matter of simply tightening the municipal belt - that's the way he and the staff run our city in the normal course of doing business. No, it will mean deciding which services and improvements will not get done. When unfilled potholes begin occurring on your street, remember this vote.