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The City’s voters approved a Utility User’s Tax (UTT) for telephone, electric, gas, and water services, set <br />at a rate of 5.5% of utility charges. The City’s revenue from this tax fluctuates based on changes in utility <br />rates and usage levels. During calendar year 2024, Southern California Edison (SCE) implemented several <br />rate increases, generating additional revenue for the City. Electricity consumption also rose, driven by <br />increased air conditioning use during heatwaves and the growing adoption of electric vehicles. The <br />combination of higher rates and elevated demand resulted in tax receipts exceeding the initial FY24–25 <br />budget estimate of $27.3 million. As a result, the FY24–25 estimate has been revised upward to $29.3 <br />million. The FY25-26 projections are expected to follow the same upward trend as FY24–25, reflecting <br />sustained increases in electricity rates and consumption. In contrast, telephone-related revenue has <br />continued to decline over the years due to competitive bundling and the shift away from traditional <br />landlines. Despite this decline, overall Utility User’s Tax revenue is expected to trend consistently <br />upward. <br />83