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6.C. - Page 21 of 196 • Placed two revenue measures on the November 2018 ballot, including a half -cent sales tax increase (Measure RR) and a cannabis excise tax (Measure DD). Both measures passed, with 68 percent of voters supporting Measure RR, and 79 percent of voters supporting Measure DD. During the latter part of FY 2019-20, in the face of multiple crises, the City remained true to the fiscal strategies of the past two years while responding to the crises of 2020 through its recovery strategy of "Respond, Restore, and Reimagine," • Continued, through several emergencies, to fund ongoing services with ongoing revenues and limited one-time revenues to one-time expenses • Limited the use of reserve funds in response to emergencies so as to maintain the 15 percent General Fund reserve level established in policy • Began reimagining what services are provided, how they are provided, and to whom they are provided, in order to adapt to a rapidly evolving environment with a focus on fiscal conservation and social equity • Launched a Climate Action Plan that includes risk management and long-term forecasting to ensure financial as well as environmental benefits • Leveraged the ten-year forecast not only for financial planning but also to analyze trends over time and reinforce a longer view in times of crisis, to support thoughtful problem solving and strategic action A summary of major revenue sources and other significant financial planning items is below. When compared to the FY 2019-20 budget, actual revenues generated approximately $10.7 million, or 6.9 percent, more revenue than the amount budgeted in the General Fund. Sales Tax Sales tax is an important source of General Fund revenue as it accounts for 19.7 percent of total General Fund revenues. This is a primary concern during the pandemic and throughout the recovery period due to nationwide reductions in consumer spending for fuel, entertainment, dining, new cars, and travel. While several of the City's larger generators of sale tax can expect reduced revenues in the economic downturn, most are still open for business. In addition, the anticipated reduction in sales tax due to COVID-19 closures has been offset by two positive developments: increased revenues from online shopping, and the addition of revenues from Measure RR. Sales tax revenues paid through resident online purchases have increased both in the number of transactions as well as the City's allocation of sales tax from them. Rather than experiencing a complete loss of sales tax from the purchases lost through storefront closures, many of those transactions moved to electronic shopping during the pandemic. This activity has coincided with a new allocation of sales tax by the purchaser's point -of -origin resulting from the U.S. Supreme Court decision in South Dakota v. Wayfair, Inc., which enabled state and local governments to recoup tax revenue formerly lost to remote sellers. This new influx of formerly lost online sales tax, together with the addition of revenue from the new Measure RR sales tax, has offset some of the reductions in sales tax revenue caused by the 2020 recession, softening the impact of the economic downturn on the City in FY 2019-20. The passage of Redwood City's Measure RR, a half -cent sales tax increase, in November 2018, became effective April 1, 2019. In FY 2019-20, Measure RR generated an additional $10.3 million in revenue; more than 30 percent of all sales tax revenue for the City. Total sales tax revenue in the General Fund increased by $6.7 million, or 25.8 percent, when compared to the prior fiscal year. Without the new half -cent sales tax revenue from Measure RR, Redwood City would have experienced a decrease in sales tax revenue of $1.2 million, or 5.1 percent in FY 2019- 20, even with the increase in online tax revenue. The City has budgeted $9.6 million of this new revenue source to be collected in FY 2020-21. Staff will analyze the sales tax revenue on a quarterly basis during the fiscal year to determine if a year-end budget amendment is needed. "" 108