Laserfiche WebLink
Proposed Add on Sales and Use Tax Measure for Municipal Services for Public <br />Consideration on the November 2018 Ballot <br />July 3, 2018 <br />Page 5 <br />the Quality of Life Team (QOLT) to address homelessness, leveraging economic development, <br />advancing police officer recruitments, furthering Enterprise Fund compliance, addressing service <br />delivery challenges, and augmenting investments in technology to streamline local government. <br />Transparency and Accountability <br />There are additional considerations that the Mayor and City Council may add to the ballot measure <br />to enhance transparency and accountability. These include annual independent audits, an oversight <br />review committee, an online open checkbook, mid -year fiscal review, and delineating and tracking <br />the new add on sales tax revenue and corresponding allocation to be evaluated as part of the <br />annual budget. <br />Annual independent audits are currently performed in accordance with the Governmental Account <br />Standards Board guidelines and are available on the City's website for the public's review. If a <br />requirement for an independent audit is added to the ballot measure, a separate audit would be <br />performed specific to the add on sales tax to ensure that new revenues are properly collected and <br />that expenditures are reviewed and consistent with governmental accounting practices. <br />An oversight review committee typically reviews on an annual basis the revenue receipts and <br />expenditures of local add on sales tax, status and performance of the programs and services that <br />are funded from the proceeds of the new revenues, and prepare reports for City Council <br />consideration. <br />The City has had an open checkbook on its' City website since 2015. This provides a mechanism <br />for any interested party to review the City's expenditures at any time through a convenient online <br />system at no cost. As an enhancement, staff could place a specific portion of the open checkbook <br />system to be made available for the new sales tax revenue and expenditures. <br />Staff is recommending that the above referenced transparency and accountability elements be <br />included for consideration by the voters. It is the goal of the City to promote transparency and <br />accountability in all efforts and will continue to enact best practices to ensure fiscal stability moving <br />forward. <br />Sunset Options <br />A sunset clause is a provision that can be added to a ballot measure to end the effect of a tax. <br />Typically, sunset options are exercised in cases where the revenue is utilized to help address <br />temporary or term specific needs, or finance capital investments. When revenue from a ballot <br />measure, such as the initiative being proposed, funds operating costs, a sunset provision can have <br />unintended consequences. This is most evident when providing enhanced services that must later <br />be eliminated or drastically cut. In Orange County, three cities have a sunset clause in their add on <br />sales tax. The cities of Fountain Valley and La Habra both have a 20 -year sunset, while the city of <br />Westminster has a 5 year sunset. However, staff has included an option with a provision to sunset <br />0.5% from the 1.5% proposed increase after about eleven years, for the City Council's <br />consideration. <br />55C-5 <br />