AgdaPkt 2018-07-23 Joint SA PFA - Laserfiche WebLink

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8.A. - Page 1 REPORT To the Honorable Mayor and City Council From the City Manager July 23, 2018 SUBJECT Ballot measure levying a one-half of one percent sales tax (the City of Redwood City Essential Services Protection Measure) for general purposes, subject to voter approval RECOMMENDATION The City Council Revenue Measure Ad Hoc Committee recommends that the City Council take the following actions: 1. Waive first reading and introduce an ordinance of the City of Redwood City adding to Redwood City City Code Chapter 32, Article XI establishing a local transaction and use tax for general city purposes; and 2. Adopt a resolution calling an election to be consolidated with the General Municipal Election and Statewide General Election on November 6, 2018, and submitting to the voters at that election a measure to maintain essential City services by enacting a one- half of one percent Transactions and Use (Sales) Tax BACKGROUND Starting in FY 2018-19, statewide financial challenges are hitting home. Though new development and increased downtown activity have increased property tax receipts and offset sales tax declines elsewhere in the city, projected revenue growth is not sufficient to cover increasing operating costs. Mirroring dynamics throughout California, the City faces a growing annual General Fund operating budget deficit that is projected to reach over $12.0 million annually (about 10% of the current year operating budget) in five years, and to increase after that. Aligning the City's resources and expenditures requires a multi -part strategy including adjusting service levels and approaches, and increasing revenues.