Sales Tax Q&A: An Interview with the City Manager

The proposed sales tax would go to fund infrastructure.


At a special council meeting on Wednesday, March 7, Alameda’s City Council will vote on a proposition to place a half-cent, 30-year sales tax on the June 5, 2012 ballot.

The tax would require two-thirds approval of the city’s voting public, and the money raised, an estimated $1.8 million a year, would be used to fund infrastructure costs of public safety equipment and facilities, including a new emergency response center and a replacement fire station. The dollars would also go toward construction costs on the Carnegie Library building and a new swim center.

I sat down with Alameda’s city manager John Russo last Friday to ask him about the tax. For even more details, you can click on the PDF of city’s report on the tax that is attached to this article (or find it on the city’s website here).

Wednesday’s meeting will be in council chambers at City Hall at 2263 Santa Clara Ave. at 7 p.m. 

So, what is this tax for? It is for facilities and equipment, with a heavy, heavy emphasis on public safety facilities and equipment. Of about 35 million we expect to raise, over 25 million of it is for public safety.

Looking at the proposal, it includes a new Fire Station 3, a new emergency response center, and money for the replacement of public safety vehicles, fire engines and patrol cars. Why these things? Alameda is not alone in failing to properly account for the depreciation of equipment and buildings. Governments at all levels —  there are a few exceptions — but most governments budget poorly. They buy a building, for example, but they don’t put enough in the budget to maintain it. Then, 15 years later, they say, oops, we need a new roof, but we didn’t put any money aside for it. So where is the money going to come from? And what are we going to cut to do that? So you’re always a generation behind from a budgetary perspective.

So are you going to address that? Yes. This measure provides Alameda with a way to get back to even. Going forward, we’re also going to change how we budget. Every piece of equipment is going to be depreciated. What that means is if you’re buying a new firehouse, like we plan to, then we're going to say the useful life of a fire station is maybe 50 years. And let's say, theoretically, you’re buying a fire station for a million dollars, then every year we’re going to put $20,000 in an account to match the depreciation of the fire house.

Why put this tax on the ballot now? The financial gaps that Alameda faces took years and years and years to get to. It’s going to take years to work out, but they can be solved. But if you continue to wait until you’re in a crisis, until you don’t have enough patrol cars or you don’t have enough fire engines, then what’s going to happen? You'll come to a point when you've got to buy that stuff. You can’t go without it. And you might say it was unforeseeable, but actually it was — because of the age of your fire fleet or patrol car fleet or because you have an earthquake and you have earthquake unsafe buildings.

Why put the pool and the library in the mix? Right now Emma Hood at Alameda High School, as best as I can tell, is being held together with sealing wax. And at some juncture that pool will be inoperable and then there will be no pool for the high school kids and seniors and master swimmers who use it. And when that happens, there will be tremendous pressure brought to bear on the government to do something now to fix the pool. It's foreseeable that that pool will be out of service very soon. So unless people say we’re just not going to do it, we might as well plan rationally for it. We should have been planning rationally for it ten years ago.

I saw that the pool is supposed to go in a “mid-Island” location? Where would that be? We have some options that I’m not prepared to discuss at this time because it would depend on getting some businesses up on the north shore near Park Street to move — they want to move, but we don’t have the deeds to the land on the base yet to move them to. There’s also a possibility we could work something out with the school district to lease some space and build a new swim center at the high school. I think what we want people to understand is wherever we build it will be easily accessible to the high school kids.

The tax proposal lays out a plan to complete the renovation of Alameda's Carnegie Library, which was seismically upgraded in 2002, but now stands vacant. Why this? The city spent substantial sums of money to bring the building up to seismic safety standards, but now it’s just sitting there. You’re not going to tear it down. You have to fix it some time. The Americans with Disabilities Act work that has to be done to make the building useable again makes sense to do now. The cost of labor and construction are favorable to us in this economy— and at some point the work has to be done, unless you’re going to leave this big beautiful building sitting in the middle of your civic center unusable.

Why move the museum there? I can’t tell you what the monetary value is of having a repository for the city’s old newspapers, school records, and municipal records is — the Alameda Museum has all of that. That’s why the city pays their rent now. They’re the city’s fundamental archive. I believe that for all cities, especially for a city like Alameda that is so wedded to tradition, having a viable museum and an effective archive for the city is something we ought to do and where better to put it than in a building that is a piece of Alameda history and in fact American history because it’s a Carnegie library.

So the pool and Carnegie building are "moving forward pieces” and the public safety pieces are really more nuts and bolts? I’d say so. But they all fall into the category of facilities that have been allowed to deteriorate to the point that that they are unusable or are on the verge of being unusable. That’s why our six-word slogan for this measure is, “Preserving Alameda’s past, protecting Alameda’s future.” That really sums up what we’re trying to achieve here.

This tax requires two-thirds for passage, how will you get it? I’m looking at what people care about. They care about emergency services. We don’t have an emergency operations center that we can rely on. You can pretend that an emergency is unforeseeable when you’re living near a fault line — or two — and you can pretend that you wouldn’t have a liquefaction problem in event of an earthquake. You can pretend a lot of things, but a natural disaster is completely foreseeable and expected. And if you don’t have an emergency operations center to deal with that then shame on you — because that really is a life and death matter.

Is it a regressive tax? A sales tax is regressive in principle — meaning it falls more heavily on people of lower incomes than higher incomes. But that’s a very simplistic view of the sales tax, because sales tax doesn’t apply to food and it doesn’t apply to housing and it doesn’t apply to services, including medical care. And when you look at lower income families the overwhelming majority of their expenditures fall in those categories. So if a sales tax were applied to food, housing and services, then, yes, it’s regressive. But when you look at well-to-do families, and you look at where their expenditures are, they have many more discretionary good purchases. I think in principle in sales tax is regressive, but in practice it’s not very regressive really.

You think this can pass? I do think it can pass. Absolutely. I think that people in Alameda love their city. They really care about Alameda and they really care about emergency services and emergency response times and this goes to the heart of our ability to provide that. 

Please note: this interview was edited for clarity and brevity. 

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carol gottstein March 07, 2012 at 07:01 PM
Converting an old Carnegie library to house the local museum is a concept which has worked thruout California [cf:Petaluma & Healdsburg] It preserves the National Register eligibility of the building & keeps it accessible to all. Ours has stained-glass windows & a mezzanine w/a glass floor, which it would be a shame to lose. The old Boys&Girls Library behind it was the home of the Carnegie's builder, Charles H. Foster, an interesting local character who also wrote books on philosophy & psychology. I worked hard to promote the concept of the Carnegie housing the Museum when I was on the Museum Board & Planning Board in the 1990s. At that time, it was opposed by the HAB & we did not yet have a new library building. Perhaps the Carnegie's time has finally come! I don't understand why any tax has to be for 30 years, tho. China or Iran might have taken over by then.
joel March 07, 2012 at 07:17 PM
Thank you Ms Jennifer in short you endorse the school district paying up to 3 times for goods no open bid are published the same for public work if it is under a certain amount , you believe it is ok and this goes for anything from services , survey and equipment. you most likely support the City Employees that went fishing using City truck , the only reason this came to light is because the Oakland PD spotted the trucks empty on their turf and thought they were stolen , You most likely endorse as well use of City vehicle for private use , and also most likely agree with terminating employees without exit interview {no interview , no traces} agree with the insane reasoning while under recession we have a pool of vehicle which are all hand detailed like on a regular basis . Agree that it's ok for city employee to go to the flea market or spend the morning sleeping in a van between home depot and the glass factory. A total use of City resources and assets without acountability , Alameda Power and telecom burned 100 millions dollars if not more .... I support the schools, Teachers do a good job not the admnistration , strongly support the Police dept ,they are the one that make and keep what this city is , I have no mercy for the fire dept it is a self driven political organisation hidding nehind paperwork. So go ahead and raise taxes. I will be exempt of the school taxes anyway, it will affect the businesses ,growth and prosperity.
joel March 08, 2012 at 04:06 AM
Thanks Ms Kate , sincerely I do believe the City is leaving abvove it's mean as far ar vehicles for instances .... and saw "still do" felt Suncal was their salvation. it remind me of the Greek governement shutting down electricity to homeowner late in their bill but not collectting anything in large corporation . The Carnegie hall , like all of them built around the Country and I do agree they have their charms , is nothing else but the biggest insult to any worker and Unions , several workers were executed by anti union anti democrat Carnegie Goons , their fault wanted a day off and better working condition,countless "in the hundreds" were thrown out of their house never to work at any Carnegie plant or anyone He was doing business , He drove them below misery. It is sad that peoples look at him as the biggest philantropist when actually he was no different if not worst than any slave driver in the cotton plantation from the South , Having given his fortune away did not help the crualty he imposed on his Employees .There is a distinction between demanding Employer and slave driver , He was the later .
Lisbeth Allen June 04, 2012 at 06:09 PM
I think it's time to make perpetual yard sales pay sales tax just like those silly stores that pay them. There is a perpetual yard sale at the corner of Lincoln and Willow (1982 Lincoln) There is one on Santa Clara at the Melinda Ann Apartments (2054 Santa Clara). Almost every Saturday and Sunday during summer, the people have their businesses set up.
Michael June 04, 2012 at 08:03 PM
Also, lots of sales tax is lost as some have figured out that if you order some foods, "To Go," no sales tax is collected -- even if you actually eat it in the restaurant. http://www.brandeating.com/2008/05/for-here-or-to-go-califorinias-sales.html


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