Get ready for tax talk

Is the Chico City Council going to call on voters to boost city revenues via a sales tax initiative? We can’t predict that outcome, but it’s looking as though the panel is finally going to broach the subject.

We’ve been keeping tabs on this scenario for many years—and at the next council meeting (Tuesday, June 19), it appears Chico’s leaders are going to at least vote on whether to have a formal discussion about such a measure. That is, they will decide if the topic is worth putting on a future agenda.

Here’s a little background: For the better part of a decade, local business leaders have been brainstorming a way for the city to generate additional revenues to pay for things like public safety and infrastructure repairs and improvements. The idea of a sales tax increase has grown increasingly popular with that bloc, as the city cut services nearly to the bone (with the exception of the Chico Police Department).

Indeed, as we reported in February (see “Time to tax?” Newslines, Feb. 1), the Chico Chamber of Commerce had formed a task force to research the topic and urged city officials to “consider a revenue measure.”

Why is the money needed? For starters, in the decade leading up the Great Recession, the city was far too generous with employee salaries and benefits, which rose, as we reported in 2007, “by a whopping 161 percent, while the [consumer price index] has increased by just 34 percent, the population by 43.5 percent, and general-fund revenues by 112 percent.”

Another problem: the specter of increasingly crushing pension obligations, which alone are projected to jump to nearly $10 million annually within five years.

Interestingly, this isn’t the first time the Chamber of Commerce has investigated the prospect of raising the sales tax. Back in 2007, the organization analyzed the budget and came to a resounding conclusion: It would not support a measure because the city hadn’t done enough to rein in skyrocketing costs. Evidently, new leadership doesn’t share those qualms.

As for this newspaper’s position, we’ve made it clear on numerous occasions that we won’t support an effort to hike the sales tax. That’s because it would unfairly burden poor people, who spend a greater share of their income on such taxes. Moreover, we’ve already seen taxation recently—when the council adopted a waste-hauling franchise agreement, the fees garbage companies paid to the city were passed along to their customers.

Still, we welcome the discussion. Who knows? Perhaps there’s a more palatable way to generate revenue. We look forward to hearing what the council, and, more important, the public has to say. After all, such a measure would require voter approval. So, get ready.