Attachment 4
PREPARED BY: ARN ANDREWS
ASSISTANT TOWN MANAGER
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
FINANCE COMMITTEE REPORT
MEETING DATE: 2/12/2018
ITEM NO: 5
ITEM NO: 11
DATE: FEBRUARY 7, 2018
TO: COUNCIL FINANCE COMMITTEE
FROM: LAUREL PREVETTI, TOWN MANAGER
SUBJECT: RECOMMEND TO THE TOWN COUNCIL POTENTIAL BALLOT LANGUAGE FOR
A 1/8 CENT SALES TAX MEASURE FOR THE NOVEMBER 2018 BALLOT
RECOMMENDATION:
Recommend to the Town Council potential ballot language for a 1/8 cent sales tax measure for
the November 2018 ballot.
BACKGROUND:
On November 7, 2017, the Town Council reviewed the recommendation of the Council Finance
Committee to proceed with preparing a ballot measure to place a 1/8 cent general sales tax on
the November 2018 ballot for Los Gatos priorities. At the conclusion of the Council discussion
and public testimony, the Town Council directed staff to have the Council Finance Committee
review and discuss both the option of a general sales tax and a special sales tax.
On December 4, 2017, the Council Finance Committee received a staff report (Attachment 1)
which provided information on the six Sales Tax measures conducted in Santa Clara County since
2008. The staff report identified the type of measure, ballot language for each, percentage of
pass/fail and type of sunset provision. In addition, the report provided a chronology of essential
administrative and Council steps necessary to place a measure on the November ballot.
This staff report provides sample ballot language for three general sales tax measures and three
special sales tax measures for Finance Committee consideration and ultimate referral and
recommendation to the full Town Council.
PAGE 2 OF 5
SUBJECT: RECOMMEND TO THE TOWN COUNCIL POTENTIAL BALLOT LANGUAGE FOR A
1/8 CENT SALES TAX MEASURE FOR THE NOVEMBER 2018 BALLOT
DATE: FEBRUARY 5, 2018
N:\MGR\AdminWorkFiles\Council Committee - FINANCE\2018\2-12-2018\Item 5 Sales Tax Ballot Language.docx 2/9/2018 4:39 PM
DISCUSSION:
On March 15, 2016, the Town Council approved the Ad Hoc Citizen Committee recommendation
to hire a public opinion research agency to conduct polling for a potential sales tax measure. The
Committee was formed to work with Town staff to study proposed revenue measures, seek
public input through a community survey, and report back to the Council. While the Council
ultimately chose not to pursue a sales tax measure, the polling data from 2016 is still relevant
today.
In May of 2016, the firm of Godbe Research presented the results of the Community Priorities
Survey. The sample size of the survey was 471 respondents with a margin of error of 4.45%. The
survey was structured around the following research objectives:
Gauge the public’s perceptions of whether the Town is doing a good job providing
services and managing public funds;
Gauge the residents’ interest in creating a dedicated revenue source for the Town;
Assess potential voter support for a general sales tax measure to maintain the
quality of life and small town character with funding that cannot be taken by the
State; and
Identify respondent service and facility priorities.
Key findings from the survey include the following:
Residents with favorable views of the job the Town is doing to provide services
was five times that of unfavorable views;
Residents with favorable views of the job the Town is doing to effectively manage
taxpayer dollars was more than double that of unfavorable views;
Informed support for a half-cent sales tax measure was 64.4%;
Support for an alternative quarter-cent sales tax measure was 64.9%; and
A general purpose half-cent sales tax measure with a 25 year sunset was deemed
viable.
In addition to the aforementioned findings the survey identified the following community
priorities as those which resonated most with respondents:
Improve traffic flow to reduce traffic congestion
Maintain 9-1-1 response times
Fix potholes and repair town and neighborhood streets
Maintain and repair the neighborhood streets
Repair the Town’s 112 miles of streets and roads
PAGE 3 OF 5
SUBJECT: RECOMMEND TO THE TOWN COUNCIL POTENTIAL BALLOT LANGUAGE FOR A
1/8 CENT SALES TAX MEASURE FOR THE NOVEMBER 2018 BALLOT
DATE: FEBRUARY 5, 2018
N:\MGR\AdminWorkFiles\Council Committee - FINANCE\2018\2-12-2018\Item 5 Sales Tax Ballot Language.docx 2/9/2018 4:39 PM
DISCUSSION (Continued):
Maintain neighborhood police patrols
Reconstruct and resurface neighborhood streets
The survey results have been used extensively to inform the sample ballot language provided in
the tables below. The sample ballot examples are intended to be illustrative for discussion
purposes and not necessarily the final ballot language that the Town Council would potentially
adopt. If the Council chooses to direct staff to move forward with a general or special sales tax ,
staff will return to Council with recommended ballot language, ordinance, and resolution.
Sample General Sales Tax Ballot Language
General Sales
Tax Measure
Sample Ballot Question
Sample #1
Informed Support
Los Gatos Ballot
Language
Lew Edwards Group
May 2016
“To maintain the quality of life and small town character in the Town of Los Gatos by:
Fixing potholes, sidewalks and repairing neighborhood and major Town streets;
Upgrading Town parks, playground equipment and restrooms;
Upgrading walking, hiking and bike trails;
Beautifying downtown,
Maintaining Town facilities, and
Other essential Town facilities and services;
Shall the Town of Los Gatos enact an one-half cent sales tax, providing $4 million dollars
annually, for 25 years, with annual audits, independent citizens’ oversight, and all funds
spent locally?”
Thesis Sample #1 provides the exact same ballot language that was crafted by the Lew Edwards
Group (campaign consultant) based on the survey results provided by Godbe Research. This
ballot language provided had informed support of 64.4%.
Sample #2
Los Gatos Ballot
Language
Sample 2018
General
“To fund essential Town services such as maintaining neighborhood police patrols;
improving traffic flow to reduce traffic congestion ; repairing potholes and fixing
neighborhood streets; and maintaining the Town’s long-term financial stability, shall the
Town of Los Gatos enact a 1/8 percent sales tax for 20 years, providing about $800,000
annually, requiring Independent Citizens Oversight with public review of spending, and all
revenues controlled locally?”
Thesis Sample #2 is based on a ballot language format used by the City of San Jose for their 2016
Measure B quarter-cent general sales tax measure. Measure B passed with 61.4% and
included a 15 year sunset.
PAGE 4 OF 5
SUBJECT: RECOMMEND TO THE TOWN COUNCIL POTENTIAL BALLOT LANGUAGE FOR A
1/8 CENT SALES TAX MEASURE FOR THE NOVEMBER 2018 BALLOT
DATE: FEBRUARY 5, 2018
N:\MGR\AdminWorkFiles\Council Committee - FINANCE\2018\2-12-2018\Item 5 Sales Tax Ballot Language.docx 2/9/2018 4:39 PM
Sample #3
Los Gatos Sample
Ballot Language
Sample 2018
General
"In order to maintain and protect Los Gatos services and facilities, including but not limited
to Town streets and pothole repair, police patrols, and traffic relief measures, shall the Town
of Los Gatos be authorized to enact a one-eighth cent sales tax for 20 years, with all
proceeds placed in the Town's General Fund providing about $800,000 annually, requiring
Independent Citizens Oversight with public review of spending and independent annual
financial audits, and all funds spent locally?”
Thesis Sample #3 is based on a ballot language format used by the City of Campbell for their 2008
Measure O quarter-cent general sales tax measure. Measure O passed with 70.5% and
included no sunset clause.
Sample Special Sales Tax Ballot Language
Special Sales
Tax Measure
Sample Ballot Question
Sample #1
Infrastructure
Improvements
“To reduce traffic congestion and maintain community parks and open space, shall the Town
of Los Gatos enact a 20 year one-eighth sales tax to generate about $800,000 annually to:
Fix potholes and sidewalks;
Reconstruct and resurface Town streets;
Improve traffic flow;
Make traffic signal improvements;
Maintain parks and open space;
Mandate annual audits, independent citizens’ oversight, and all funds spent
locally?”
Thesis Sample #1 is based on a ballot language format used by the Santa Clara Valley
Transportation Authority for their 2016 Measure B half-cent special sales tax measure.
Measure B passed with 71.7% and included a 30 year sunset clause. In addition, the bullets
above represent 7 of the top 10 priorities identified in the Godbe Research survey.
Sample #2
Public Safety
“To maintain the quality of life and small town character of our Town, shall the Town of Los
Gatos enact a 20 year one-eighth sales tax to generate about $800,000 annually to:
Maintain neighborhood police patrols;
Maintain 9-1-1 response times;
Improve traffic flow to reduce traffic congestion;
Mandate annual audits, independent citizens’ oversight, and all funds spent
locally?”
Thesis Sample #2 is based on a ballot language format used by the Santa Clara Valley
Transportation Authority for their 2016 Measure B half-cent special sales tax measure.
Measure B passed with 71.7% and included a 30 year sunset clause. In addition, the bullets
PAGE 5 OF 5
SUBJECT: RECOMMEND TO THE TOWN COUNCIL POTENTIAL BALLOT LANGUAGE FOR A
1/8 CENT SALES TAX MEASURE FOR THE NOVEMBER 2018 BALLOT
DATE: FEBRUARY 5, 2018
N:\MGR\AdminWorkFiles\Council Committee - FINANCE\2018\2-12-2018\Item 5 Sales Tax Ballot Language.docx 2/9/2018 4:39 PM
above represent 3 of the top 7 priorities identified in the Godbe Research survey.
Sample #3
Parking Garage
“To maintain the vitality of downtown, reduce congestion , enhance economic vitality, and
maintain the quality of life of our Town, shall the Town of Los Gatos enact a 20 year one-
eighth sales tax to generate about $800,000 annually to construct a new parking facility and
other downtown improvements mandating annual audits, independent citizens’ oversight,
and all funds spent locally?”
Thesis The downtown parking project has never been polled , however, there appears to be
sentiment that a parking garage could help alleviate parking congestion and help strengthen
the downtown business district. It should be noted that community vitality concepts were
two of the Council Strategic Priorities recently embraced.
CONCLUSION:
Per Council direction, the Finance Committee should determine whether to refer a general sales
tax or special sales tax proposal for full Council consideration . In addition the Committee should
determine its preferred ballot language approach for recommendation to the full Council.
COORDINATION:
This report was coordinated with the Town Manager’s Office, the Town Attorney’s Office, and
the Finance Department.
FISCAL IMPACT:
Total election costs for the Town for three Council seats and on e ballot measure are yet to be
determined, however, the cost for two seats and one ballot measure in 2016 was approximately
$120,000. In addition under the Revenue and Taxation Code section 7272, the Board of
Equalization (BOE) will bill a new special taxing jurisdiction for preparatory charges to administer
the new district tax based on actual costs after the tax has been submitted by the various BOE
units’ actual charges. The statutory maximum amount of preparatory costs shall not exceed
$175,000.
Attachment:
1. December 2017 Sales Tax Report to the Finance Committee