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MA,v 6.1. B. - Page 39 ID ANALYSIS <br /> In November 2011 Redwood City voters approved an increase in the transient occupancy tax rate from 10% to <br /> 12%. We expect this to produce an additional $600,000 of transient occupancy tax revenue each year. <br /> The voters also approved increasing the City's business license tax 50% over three years. This should increase <br /> general fund revenues by about $800,000 annually when fully implemented in FY 2014/15. <br /> At this point it remains to be seen what affect, if any, the State of California's attempt to extract significant funds <br /> from redevelopment agencies will have on the City's general fund. Under legislation signed into law by Governor <br /> Brown, Redwood City's redevelopment agency will be required to pay the State $4.9 million in FY 2011/12 and <br /> $1.2 million annually thereafter should the City desire to retain its redevelopment agency. Failure to pay these <br /> amounts will result in the dissolution of the agency. <br /> The California Redevelopment Association has challenged the State's action with a lawsuit filed in the California <br /> Supreme Court. A decision is expected in January 2012. <br /> Should the laws survive legal challenge the City Council will need to decide to either reduce agency activities, shift <br /> the costs of agency activities to the City's general fund, or some combination of both. Shifting costs to the City's <br /> general fund, however, will further exacerbate the financial challenges this fund is facing. <br /> CONTACTING THE CITY'S FINANCIAL MANAGEMENT <br /> This Comprehensive Annual Financial Report is intended to provide citizens, taxpayers, investors, and creditors <br /> with a general overview of the City's finances. Questions about this report should be directed to the Finance <br /> Department, at 1017 Middlefield Road, Redwood City, CA 94063 <br /> 13 <br />