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Submitted by Julie Testa
A recent community survey found that 91% of Pleasanton residents say the city is a good or excellent place to live. To maintain what is wonderful about our city, come November, we will vote on a measure that would increase sales tax by half of one percent.
That means, for every purchase of $100, another 50 cents would go exclusively to the Pleasanton city budget. Prescription medicine, groceries, rent, mortgage payments and utilities will be exempt from the tax.
Of the existing sales tax of 10.25%, just 1% comes directly to Pleasanton. By law, every penny generated by this local voter-approved, half-a-penny sales tax must stay local. That means all funds generated by this tax would stay local to fund essential city services and infrastructure improvements for Pleasanton. None of the estimated $10 million annually can be taken by the state or county.
Many residents are perplexed about the current budget shortfall in the city of Pleasanton. Pleasanton has never asked its voters for help, but with a growing tab that now stands at about $13 million a year — for the next 10 years — it is necessary.
Some political self-interest opponents want you to believe that this is a new problem based upon fiscal mismanagement. Nothing could be further from the actual truth! Decisions that got us here date back decades, long before anyone now in leadership was in charge.
So, the question is how did we get here? There are several reasons: declining revenues from sources that were once robust (reduced revenue from Stoneridge Mall), unforeseen circumstantial challenges (Pleasanton lost more than $11 million in hotel tax revenue during the pandemic and has not yet recovered to the pre-pandemic level), along with costly repairs to the city’s aging infrastructure that must finally be addressed, together with escalating expenses.
However, the most significant factor is the ballooning costs of legally mandated CalPERS government pension obligations, which continue to consume an alarming percentage of the city’s general budget.
Greater payments toward this mandated obligation have been impacting the city’s general fund for decades. The state has known for years that municipalities across the state would hit a pension tsunami, but has not offered adequate solutions, leaving California cities in a lurch.
City leadership has and will continue to implement cost-saving and revenue-generating measures. Pleasanton has implemented all the legal corrections available to address unsustainable pension costs, including restructuring pension formulas for new hires and an account (called a 115 Trust Fund) to help fund the decade of peak years. But even these remedies are not enough.
As a city and a community, Pleasanton supports public safety, and we apply resources for public safety as a top priority (more than half of the general budget), which draws a significant portion of the pension obligation.
Please understand, this tax will not fund government pensions; they are an obligation that we owe to those who served our city, and they will be paid. This tax will help maintain our ability to sustain the services that residents value most.
We must join together to navigate these challenges. This small additional tax is an investment in maintaining what is wonderful about Pleasanton. I ask you to vote Yes on Measure PP, “Pennies for Pleasanton”.
Editor’s note: Pleasanton Vice Mayor Julie Testa represents District 3 on the City Council. She voted in favor of sending the 0.5% sales tax measure (Measure PP) to the voters in the Nov. 5 election.
Pleasanton is dealing with an increasing structural deficit, which affects its ability to maintain infrastructure and facilities. Home prices in Pleasanton have been falling faster than in most parts of the United States, which will impact property tax revenues.
The pension debt situation for Pleasanton is significantly impacted by the financial health of California’s Public Employees Retirement System (CalPERS). CalPERS currently has approximately $611 billion in pension debt and is only 72% funded, meaning it has seventy-two cents for every dollar promised in retirement benefits.
This underfunding creates budgetary pressure for Pleasanton, as Pleasanton needs more resources to cover pension obligations. The investment losses reported by CalPERS (MINUS 6.1%) further exacerbate this issue. As a result, Pleasanton will face increased financial strain, which will affect public services and other budget priorities.
Don’t be fooled. Let’s just point out some inaccuracies in Julie Testa’s opinion.
1 The opposition to Measure PP is not “some political self-interest opponents”. The opponents are Pleasanton residents who have done their homework, the city has not done their homework or dug deep enough into their own budget, instead want a silver bullet to fix their lack of fiscal responsibility. Taxing us residents is not the answer!
2 The pension 115 fund is not being used to help with the pension deficit. That’s 50 million that they didn’t build into the budget! They would rather tax us – the residents.
3 – “ Prescription medicine, groceries…will be exempt” Not completely true – over the counter medications which makes up approximately 60% spent on medications is taxed! Groceries – only food meant for consumption is not taxed but excludes many items. Your non food items like shampoo, cleaners etc, any hot prepared food to consume on site or taken home from a grocery store, dog food, cat food, pet food is taxed! Carbonated or effervescent bottled waters, spirits, malt liquors, wine, and carbonated beverages are taxable. All restaurant meals are taxed.
4 Just consider why the $500,000.00 travel budget has not been reviewed and had cuts? Why?
City is spending over $46,000.00 a year to maintain the rose garden park at the century house. This park is CLOSED to the public and has been for years and will be for years to come. Thats almost $50,000.00 per year being spent on a park we can even use. Why?
These are just two examples of the city not digging deep enough before wanting to tax us!
And then there is the Stoneridge mall. For some reason the city leadership is giving the 4 owners a pass to do nothing – again Why?
Attend the city council meetings, watch them on YouTube, you yourself will be able to see the truth.
“Some political self-interest opponents want you to believe that this is a new problem based upon fiscal mismanagement. Nothing could be further from the actual truth!”
And some political self-interest supporters want you to believe that a 10.75% sales tax rate is “small”. It isn’t. High taxes (sales, gasoline, income) are one of the reasons why people/businesses leave the state.
How does Pleasanton’s sales tax compare to the rest of California?
Pleasanton’s current 10.25% sales tax is among California’s highest sales taxes. It is only 0.50% lower than California’s highest rate, Newark 10.75%.
Pleasanton’s rate is 3.00% higher than California’s lowest sales tax, which stands at 7.25% in places like Filmore.
Most towns and cities in California have their rates somewhere in the middle, like El Segundo, which has a sales tax rate of 9.50%. Here’s a comparison of Pleasanton’s tax rate with a few other cities in California.
Filmore 7.25% Citrus Heights 7.75 El Segundo 9.50% Pleasanton 10.25%
Bay Point 8.75% San Ramon 8.75% Danville 8.75 Pittsburg 9.75%
Back in 2009, when the school district was facing catastrophic budget woes, people who were being laid off (me) sort of understood that action because the district office had been stripped to the bone. I don’t see any budget cuts, like the rose garden maintenance mentioned above, so I’m not likely to support the tax until I see some movement downtown.