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November 6, 2018 — California General Election
Local

City of Scotts Valley
Measure N - Majority Approval Required

To learn more about measures, follow the links for each tab in this section. For most screenreaders, you can hit Return or Enter to enter a tab and read the content within.

Election Results

Passing

4,038 votes yes (68.07%)

1,894 votes no (31.93%)

Transient occupancy tax
— undefined

Shall the City of Scotts Valley adopt an ordinance amending Section 3.24.030 of the Municipal Code raising the transient occupancy tax rate from 10% to 11%?

What is this proposal?

Measure Details — Official information about this measure

Impartial analysis / Proposal

Kirsten Powell, City Attorney, City of Scotts Valley

This ballot measure, if adopted by City voters, would amend the Scotts Valley Municipal Code by raising the Transient Occupancy Tax (TOT) rate from the current rate of 10 percent to 11 percent. The Transient Occupancy Tax is a tax paid by hotel and motel guests who spend fewer than 30 consecutive days in a hotel or motel in the City. The tax is on the room rent paid. For example, a hotel guest currently pays $10 tax per night on a $100 hotel room. If the ballot measure is adopted, the hotel guest would pay $11 tax per night on a $100 hotel room.

All of the City's transient occupancy tax revenue is deposited into the City's General Fund and used to pay for City operations and programs, including police services, recreation, park maintenance, the repair of streets and roads, and other essential City services. This ballot measure therefore proposes a "general purpose tax" rather than a "special purpose tax" and requires a simple majority vote for adoption. Since many of the City's hotel/motel guests are non-City residents who are tourists or City visitors, much of the increased tax revenue generated by this measure, if adopted by the voters, would be paid by non-City residents.  The tax revenue will underwrite the costs of providing municipal services to local visitors and City residents. A “Yes” vote will increase the tax from 10% to 11%. A “No” vote will leave the tax unchanged.

This ballot measure has been placed on the ballot by the Scotts Valley City Council.

Financial effect

Tony McFarlane, Administrative Services Director, City of Scotts Valley

Measure N authorizes the City of Scotts Valley (City) to increase the existing Transient Occupancy Tax (TOT) rate from 10% to 11%. Visitors pay this tax when staying at any lodging facility (such as a hotel or motel) for 30 days or less within the City. Therefore, the tax appropriately places the burden of providing additional local support services, like streets and public safety, on the visitors who drive this need. The tax is on the room rent paid. For example, a hotel guest currently pays $10 tax per night on a $100 hotel room. If the ballot measure is adopted, the hotel guest would pay $11 tax per night on a $100 hotel room.

Additional revenue generated by the new TOT rate will help to maintain core City services, such as police, recreation, park maintenance, the repair of streets and roads, and other essential City services. It will also reduce the City’s General Fund structural deficit (projected at $1.2 million for fiscal year 2018/19).

If approved by the voters, the new tax rate would become effective January 1, 2019. The tax increase will generate approximately $230,000 per year in new revenue. The projected revenue is based upon analysis of historic TOT revenues and the anticipated opening of two hotel establishments within the City over the next two years. 

Published Arguments — Arguments for and against the ballot measure

Arguments FOR

Measure N prevents deep cuts to Scotts Valley’s core services.  Please vote Yes on N.

Scotts Valley is doing its job today with approximately 20% fewer staff than 15 years ago. The City has laid off workers, contracted out for services, increased fees for services, and shifted more pension costs to employees. 

However, State funding formulas continue to adversely impact small cities like ours.  Scotts Valley only gets back 6.5% of the property taxes it generates, one of the lowest percentages in the state.  As a result, despite years of belt-tightening, Scotts Valley continues to face ongoing budget deficits. 

With cash reserves dwindling, the City will need to make severe cuts in police protection, park maintenance, recreation programs and road repair unless new revenues are found in the coming years.

How does Measure N prevent deep cuts to Scotts Valley’s core services?  By reducing the City’s structural deficit and putting Scotts Valley on the path to financial sustainability.  Measure N:

  • Imposes a 1% increase in the City’s hotel tax (from 10% to 11%);
  • Impacts visitors to our community, not residents;
  • Aligns Scotts Valley’s hotel tax rate with nearly all local agencies in the County;

Scotts Valley has historically kept its tax burden low compared to many other agencies and has a well-earned reputation for tight-fisted financial management. The City only asks voters to consider modest tax increases when the alternative is painful cuts, which is exactly what Scotts Valley will face in the coming years without more revenue.

Measure N prevents deep cuts by taxing hotel visitors, not residents. Measure N puts the City on the road to financial sustainability, and maintains the core services and incredible quality of life we enjoy today.

Please vote Yes on N to maintain Scotts Valley’s police protection, park maintenance, recreation programs and road repair. 

www.ProtectSVServices.com  

Jim Reed
Mayor, City of Scotts Valley

Jack Dilles
Vice Mayor, City of Scotts Valley

Jeanette Larkin
Co-Owner, Larkin Precision Machining, Inc.

Linda Benko
Woman of the Year and Former Treasurer, Falcon Club

Stephen D. Walpole
Retired Chief of Police, City of Scotts Valley

 

Arguments AGAINST

No Argument Against Measure N was filed.

More information

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