Town Council considers sales tax measure (July 23, 2020)
Apple Valley, CA — July 23, 2020: At its July 28 meeting, the Town Council will discuss adding a ballot measure to the November 3, 2020 general election. The measure would ask Apple Valley voters to consider approving a 1% sales tax measure to increase public safety services, as well as enhance community services, and address public infrastructure needs, while building reserves to respond to any future crises or temporary revenue impacts.
If approved in November, the sales tax measure would generate approximately $7 million annually.
“This type of tax can be paid by more than just Apple Valley residents, which is the primary reason we are considering it above all other financial solutions,” said Mayor Scott Nassif. “When people from other areas patronize Apple Valley restaurants and shops, they help our residents pay for police and other community services. This lightens the tax burden on our residents.”
With the anticipation of the Virgin Trains USA project in north Apple Valley, along Interstate-15, the increased consumer activity and sales transactions will also help inject new sales taxes for the Town in future years.
At its May 26 budget workshop, the Town Council received a staff presentation on the Town’s 2019-20 Budget Year revenues and expenses, including an estimated revenue shortfall of $1.27 million, and a forecasted revenue shortfall of $3.53 million in the 2020-21 Budget Year, due to the COVID-19 pandemic.
The economic impacts of the COVID-19 pandemic are projected to last two to four years, at least, and will require the Town to address its long-term financial strategies. The Town has already made repeated cuts, reductions, and layoffs, and reduced some levels of services. The Town must now either raise revenues or further decrease the levels of service to the community, ultimately eliminating entire programs, events and services.
A variety of options were provided to the Town Council to increase revenue in the 2020-21 Budget Year and beyond. As a result, and while recognizing the high priority Apple Valley residents have historically and consistently placed on public safety, the Town Council directed staff to bring forward the ballot measure for further discussion.
“Particularly during this pandemic, we are more grateful than ever for the work of our local law enforcement officers,” said Town Manager Doug Robertson. “However, the rising costs of public safety, which climbs higher than any other Town general fund expense, represents an unsustainable upward trend in the cost of keeping our residents, businesses and community safe. Moreover, the public safety contract is estimated to increase 5 percent each year for the next five years, rising to nearly $20 million by 2025.”
In the 2020-21 Budget Year, the Town’s General Fund of $36.08 million includes $15.5 million dedicated for police services.
Based upon the budget forecast, the consequences of not enacting a sales tax increase or deep cuts to services and staff, the Town will run out of budget reserves in 2021-22.
“Over the years we’ve strived to build our economic base through new retail and industrial development and by encouraging community support of our local businesses through our Shop Local campaigns,” said Orlando Acevedo, Director of Business Development and Communications. “These efforts all help our revenue base, but not enough. We’ve been successful, but we still lose a lot of our sales transactions and tax dollars when Apple Valley consumers shop at the mall or Victoria Gardens or on Amazon, for example.”
California law does not give taxing authority to the Town Council but rather to the people of Apple Valley. It gives the authority to enact a sales tax for general purposes with the approval of the voting majority in a Town election. The Town Council only has the authority to place a tax measure on the ballot for the people to decide.
The estimated cost to place the measure on the November ballot is $20,000. If the Town Council decides to place the measure on the ballot for the November election, it will be the first time Apple Valley voters have considered a sales tax measure in the Town’s 32 years of incorporation.
“This moment represents a fork in the road for our community and our future. Do we make the hard choice to fund our better way of life or do we yield to the challenge and forsake our quality of life, our public safety, and our community amenities?” asked Mayor Nassif. “This is not an easy request but it is a necessary one.”
The Town Council welcomes public input on the proposed measure.
The July 28 Town Council meeting is closed to in-person public attendance in order to maintain social distancing; however, it can be viewed live at applevalley.tv or on Frontier channel 29 or Charter Spectrum channel 186. Members of the public may provide comment in one of two ways:
- Email a comment, including agenda item referenced and contact information, to [email protected] by noon on Tues., July 28, to be included in the record;
- Email a “Request to speak,” including agenda item referenced and contact information, to [email protected] by noon on July 28. At the time of the requested agenda item, the Town Clerk will place a phone call to the interested person and allow them to speak to the Town Council via speaker phone, during the live meeting, for up to three minutes.
The agenda can be viewed online at av.town/agendas.
For more information please contact the Town’s Public Information Office at [email protected]