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San Anselmo Changes Its Mind About Sales Tax

Council decides not to put local tax measure on the ballot in November.

San Anselmo Changes Its Mind About Sales Tax

The San Anselmo Town Council reversed its decision, late Tuesday night, July 26, to – citing growing opposition and a concern about creating competition for .

“I’m going to change my mind,” said Mayor Ford Greene. “It’s not a good idea to go and do something if you haven’t done the preparation and your likelihood of failure is high.” 

Two weeks ago, the council . Council Member Tom McInerney was the dissenting vote. The only decision left for the council at Tuesday night’s meeting was to approve the resolution and decide on a sales tax amount of either 0.5 or one percent. A one percent general sales tax would have raised approximately $1 million for the town’s general fund.

However, last night, the council turned heavily against the sales tax, deciding instead not to place it on the ballot. Just Council Member Barbara Thornton said she was still in favor of seeking a local sales tax.

The change came after a presentation from the and from John Wright, a board member for the Tamalpais Union High School District.

Wright, who had also sent a letter to the council members earlier in the week, said that a local San Anselmo sales tax could hurt the school district’s effort to renew it’s own parcel tax this fall. If approved, the district’s parcel tax would start at $245.94 in July 2012 and rise by 3 percent annually for 10 years. 

“We’re concerned about competing tax measures on the November ballot,” said Wright. The Tam Union parcel tax, he said, accounts for 17 to 18 percent of the district’s budget.

“It’s my desire to honor the request of the Tam board,” said Council Member Kay Coleman. “And not be in competition of what they’re planning to do.”

Connie Rodgers, president of the San Anselmo Chamber of Commerce, also presented the results of a survey of business owners about the tax. According to the survey, 74 percent of the business owners were opposed to a one percent general tax and 53 percent were opposed to a 0.5 percent general tax. If it was a special tax, ear-marked for specific purposes, 56 percent said they would still be opposed to a one percent tax hike.

Rodgers also noted that in the list of the top 25 tax-generating properties, there wasn’t one antique shop or small boutique – suggesting that it’s not wealthy out-of-towners paying San Anselmo’s taxes. The primary tax generators were , , grocery stores, restaurants and a few businesses like and .

“This is really scary stuff for a business owner,” said Heidi Krahling, who owns and . “It’s a scary time.”

The town is dealing with an approximately $190,000 budget deficit, which it plans to close this year by pulling from reserve funding. In addition, Town Manager Debbie Stutsman announced at the Tuesday night meeting that negotiations had recently finished with the police and fire unions and the police officers and fire department were making a concession of a three percent contribution to their retirements. Town staff has also not had raises for four years and the town has made a number of budget-cutting measures already, she noted. 

The sales tax, it was hoped, would provide additional funding for deteriorating infrastructure, such as roads.

A general sales tax, which isn’t ear-marked for a specific item, requires just a simple majority vote and must be places on the ballot during a council election – either this November or in two years. A special tax for specific items, such as road maintenance, would require a two-thirds vote.

Council Member Jeff Kroot noted that it would take a $200 parcel tax to raise the same amount of money as a one percent sales tax and that the two-thirds majority “is really hard to do.” Out of five different parcel tax elections, he noted, in the time he has been in town, just two have passed.

Council Member Barbara Thornton said she was still voting to put the local sales tax on the November ballot, because she was concerned about the roads and infrastructure in town. She also felt that the town had made a number of budget-cutting moves already and that the council could make policies that would direct the money to go to the road maintenance fund.

Thornton also noted that because San Anselmo doesn’t have any appliance stores or large malls, residents are already spending their tax dollars to buy large-ticket items in San Rafael and Novato, which have a 0.5 percent higher tax rate than San Anselmo. 

“It’s my responsibility to communicate to the public that we have a need,” said Thornton.

Fairfax will consider .

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