LB City Council moves to extend sales-tax increase

Voters would need to approve the extension of Measure A.

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LB City Council moves to extend sales-tax increase

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The Long Beach City Council voted Tuesday night to direct the city manager to prepare an ordinance for review later this month to extend Measure A, in an effort to address financial challenges the City is facing.

In July 2016, Long Beach voters approved Measure A, a 10-year sales-tax increase aimed at improving public safety and infrastructure. Per a council resolution, after being raised by 1 percent for six years, the tax increase would decline by a half-percent for four years and then expire in 2027.

“As part of that measure, we established a five-member Citizens Advisory Committee to really review the use of the funds by the City,” said Assistant City Manager Tom Modica during Tuesday’s council meeting. “They meet about three to four times a year. They take action to determine, ‘Is the spending that the City’s doing consistent with the resolution and the promise made by this council to voters?’ and they have approved that every single year. The number that it is generating is about $60 million a year at 1 percent and then about $31 million a year when it hits half a percent.”

Modica said that, despite Measure A being “an enormous success,” the City faces new challenges related to community health services, including those resulting from the closing of Community Hospital last year. He also indicated that infrastructure challenges remain despite the initial investment.

“We really do have long-term funding solutions that we need to identify over the next 30 years for our infrastructure,” Modica said. “We’ve also dedicated about half of the tax towards funding operations, and 2027 really isn’t that far away, where we have to make some decisions about whether those positions are at risk for elimination or whether they’re going to continue.”

In declaring some of the measure’s successes, Modica said that, through A, the City has added public-safety officers, maintained public-safety personnel who would have otherwise been reduced and “funded an unprecedented investment in our city’s infrastructure.”

He added that, of the $81 million generated by Measure A funds: over $42 million has been invested into streets, sidewalks and alleys; about $27 million has been directed to parks-and-recreation facilities; about $15 million has been invested into other public facilities; and about $3.5 million has been used for stormwater projects.

Modica stressed that presenting a measure to voters to approve the extension must occur soon, since other entities– such as the County of Los Angeles and the South Coast Air Quality Management District– are expected to seek higher tax rates from residents.

He explained that the tax Long Beach voters would pay would be the same, no matter which entity receives the extra revenue, but staff is recommending acting soon in order to get a city measure on the ballot in March of next year rather than in November.

“That [sales-tax] amount would still be 10.25 percent,” he said. “It would just go to a different entity other than Long Beach.”

Modica said the extension would generate $15 million after Fiscal Year 2022 and $45 million a year after Fiscal Year 2027, on top of the $15 million annually after 2022.

During public comment, a 2nd-District resident suggested that, since there appears to have been a reduction in crime, less investment should be made into the police department and instead directed toward other issues, such as mental-health support and homeless services.

Paul Meisel, a board member of Long Beach Firefighters Local 372, expressed his association’s support for Measure A.

Another resident, Joe Weinstein, said he wishes Measure A could “do the job, but it inherently cannot,” because, even with it in place, the City is falling behind in infrastructure.

The fourth and final speaker was Jim Foster, president of the Long Beach Police Officers Association, who praised “all of the good things that came out of Measure A for our city.”

Fifth District Councilmember Stacy Mungo said that, although Measure A has brought many improvements to public facilities, there is still much more to be done.

“I think it’s important for residents to have the opportunity to decide if Measure A has demonstrated the return on investment that they had hoped for and if they trust this council and the citizen oversight committee to maintain a focus on the priorities that they set out,” she said. “I hope that the discussion around what we spend that money on will remain focused on the much needed repair of our very poor streets and, [worse, our] park bathrooms. The City of Long Beach still has over $200 million of streets that are in very poor condition.”

On Wednesday morning, Carlos Ovalle, executive director for the community group People of Long Beach, told the Signal Tribune that he has several issues with Measure A.

“It hurts the little people in Long Beach, and it’s clear we’re not getting what was promised,” Ovalle wrote in an email. “In the argument for Measure A, we were told, ‘We have worked hard to make this community safer, healthier and a better place to raise a family and open a business.’ Yet small businesses have continued to close, we are not healthier and there have been 25 shootings just in the last two months, breaking previous records, and, at barely half the year, we’re at the same level of violent crime as we were in the average of the last five years.”

Ovalle said the measure hurts those who are most under distress, including the working poor, those on fixed incomes– including seniors and veterans– and struggling small businesses.

“Sales tax already is a form of regressive taxation,” Ovalle wrote. “If I buy a $200 bed for my child, I pay $20.50 in taxes. If I’m earning minimum wage in Long Beach, the taxes for that item represent almost 4 percent of my gross weekly salary. But if I’m a professional making $2,500 a week, the same taxes on that item represent less than 1 percent of my gross salary. All that is on the side of the consumer. But small businesses also struggle, overburdened as it is for any retail that has to compete with Internet sales and now also with surrounding cities that draw business away from Long Beach.”

Ovalle added that, although Measure A’s campaign literature and ballot arguments promised that the taxes were intended to support increased public-safety measures and infrastructure improvements, the actual text of the ordinance was such that the City could use the money in other areas.

“To date, as far as I’m aware, the City hasn’t released the difference between baseline budget for infrastructure and the infrastructure expenditures attributable to Measure A, and we still don’t have the promised reinstatement of the 200 police officers as mentioned in the campaign flyers,” Ovalle wrote. “In addition to the above, it was promised numerous times, verbally and in writing, that Measure A has a sunset provision. With yesterday’s vote City Hall is reneging on its promise.”