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Cable, energy taxes remain stable revenue sources for city
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Property and sales taxes may have taken a dive in terms of revenue to pay for Manteca municipal operations but there are four taxes that have actually brought more money into municipal coffers.

The taxes are those imposed on electricity usage, cable TV, natural gas usage, and the charges for staying in motel rooms. Altogether, they generated $1,530,100 for Manteca in the fiscal year ending June 30, 2009. That is up from $1,505,691 in the previous fiscal year. The city projects those four taxes will generate $1,630,000 when the current fiscal year ends on June 30, 2010.

State law allows all cities to level a fee on privately owned utilities for the privilege of using municipal right-of-way for power poles or underground lines as well as natural gas pipe. The fee is equivalent to 1 percent of the gross sales. That brought Manteca $139,000 from natural gas sales last year and $481,397 from electricity sales.

Every time PG&E gets a rate increase and use within Manteca remains constant, the city receives more money.

South San Joaquin Irrigation District has already formally committed to paying that one percent franchise fee plus an additional percentage amount for all three cities within its service territory– Manteca, Ripon, and Escalon – should they enter the retail power service with the initial goal of reducing rates 15 percent across the board. That 15 percent reduction would save enterprise accounts significant money including at least $180,000 for sewer operations. General fund savings could reach $100,000 with SSJID as the power provider.

State law also allows cities to asses a franchise fee up to 5 percent on cable TV companies for also using poles or underground lines along city streets. Although cable has come under increasing competition from dish TV providers, an expanding array of entertainment options through Comcast has helped grow overall receipts from their customers in Manteca.

The motel room tax – approved by Manteca voters – imposes a nine percent charge on room rents within the city limits. That amount of revenue is expected to increase in the coming months with the pending opening of the Hampton Inn Suites next month near Bass Pro Shops in The Promenade Shops at Orchard Valley.

Other general fund revenue is proving to be hit hard by the recession in the same manner as property and sales tax.

Business license fees, for example, are expected to only come to $500,000 this year. That compares to $786,300 in the fiscal year ending June 30, 2008. Fees vary from $15 to $9,500 depending upon the type of business.

Overall, projections in the current budget anticipate either a slight increase or a drop in almost all revenue sources.

Manteca’s current working general fund deficit for the fiscal year starting July 1, 2010 is $3.8 million.

The only realistic way that deficit can be reduced with revenue is through some cost recovery efforts of charges for specific city services used when the public seeks building permits or has a state mandated fire inspection to increases in property or sales tax.

The current budget anticipates property taxes will come in at $9.3 million while sales tax will reach $5.6 million. Any revenue beyond that – should it come into city coffers – would be used as the base projection for next year and would lower the amount of cuts that the city would need to make to bridge the $3.8 million gap.