RIPON — Proposed sales and hotel tax ballot measures were axed by the Ripon City Council at Tuesday night’s meeting.
The decision came at the same time City Administrator Leon Compton reported the city was in the black in month to month comparisons in March by $169,500 not counting one golden handshake retirement for $73,200 that was to be completely paid.
The city continues to show an actual deficit of $1.62 million that is expected to be eliminated by the end of the year, he added. It was noted that 73 per cent of the sales taxes are paid through mostly fuel purchases by out-of-town motorists and truckers.
The new tax measures were in the planning stages for the November general election to raise sales tax by a penny and the hotel transient tax by five cents to offset the void in the city’s general fund due to the down economy.
The sales tax increase would have elevated the level of the tax to 9.25 per cent matching that of Manteca that has the added half cent that provides for public safety under Proposition M.
Mayor Chuck Winn said he feels the city is probably in much better shape financially than many other municipalities in the area.
“We will balance our budget this year and next, although there may have to be some more cuts,” he said.
If the council had elected to go for the ballot measures, it would have been at a cost of $18,000 to $20,000 each that would be paid to the San Joaquin County Registrar of Voters just to be placed on the ballot. The sales tax would have been a general tax requiring 50 per cent of the voters plus one in favor for it to pass. The hotel tax – a special tax – would require a two-thirds vote by the citizenry.
After the council concluded its discussion on the merits of moving forward with the two tax measures, Mayor Winn opened comment from the audience.
Schemper’s Ace Hardware owner Ward Schemper, former Ripon Unified School District Superintendent Leo Zuber and real estate broker Marge Imfield moved separately to the podium and voiced their objections to any new taxes at this time.
Schemper said the sales tax alone would cost his hardware store customers about $10,000 a year at a time when the city is starting to see an upswing in business. He warned that it would be a “recessive tax” because such companies such as Guntert Steel could invoice their product at the delivery point where the tax might be less – cutting Ripon out of receiving any of those funds.
“You could be wasting your money,” he said referring to the $38,000 required to place the two items on the November ballot.
Zuber said the city has worked diligently to cut costs behind the scenes and now to go out and tell the community you want a one per cent sales tax – for what, he asked.
“This tax increase seems to be a reaction to the loss of revenue due to the recession. My concern is that it represents a permanent solution to a temporary problem. If we get back to normal in four years to the income we had two or even four years ago, we don’t need this tax,” Zuber insisted.
Marge Imfield added, “Education is by far the most important part of this adventure,” suggesting that the council needs to better inform the public of the need for the inflow of new tax funds.
She said that she is one who shops in Modesto and would be more prone to do so if the tax rate were lower in Ripon. She said she now has two choices for regional shopping – Manteca and Modesto – and she chooses Modesto because their tax is lower than Manteca.
Councilman Red Nutt said there is no way the city would ever get the sales tax passed in this economy – it’s like crying wolf, he added.
“I do feel we will get through this. We have to make do with what we have in the pot,” Nutt said.
“We have businesses in the downtown that are struggling. I shop at Schemper’s Hardware and I buy out of town. You only have to talk to him (Ward Schemper) and he will match out-of-town prices,” Nutt added.
“If it gets on the ballot, I will vote against it,” he lamented.
Councilman Dean Uecker said he had his mind made up before the meeting that he would support the proposed taxes, but after arriving he said he felt the council might be overreacting.
Councilman Charlie Gay also dissented saying he didn’t feel the taxes would be passed by the voters in November and the $38,000 to $40,000 used to put them on the ballot would have been lost money.
The decision came at the same time City Administrator Leon Compton reported the city was in the black in month to month comparisons in March by $169,500 not counting one golden handshake retirement for $73,200 that was to be completely paid.
The city continues to show an actual deficit of $1.62 million that is expected to be eliminated by the end of the year, he added. It was noted that 73 per cent of the sales taxes are paid through mostly fuel purchases by out-of-town motorists and truckers.
The new tax measures were in the planning stages for the November general election to raise sales tax by a penny and the hotel transient tax by five cents to offset the void in the city’s general fund due to the down economy.
The sales tax increase would have elevated the level of the tax to 9.25 per cent matching that of Manteca that has the added half cent that provides for public safety under Proposition M.
Mayor Chuck Winn said he feels the city is probably in much better shape financially than many other municipalities in the area.
“We will balance our budget this year and next, although there may have to be some more cuts,” he said.
If the council had elected to go for the ballot measures, it would have been at a cost of $18,000 to $20,000 each that would be paid to the San Joaquin County Registrar of Voters just to be placed on the ballot. The sales tax would have been a general tax requiring 50 per cent of the voters plus one in favor for it to pass. The hotel tax – a special tax – would require a two-thirds vote by the citizenry.
After the council concluded its discussion on the merits of moving forward with the two tax measures, Mayor Winn opened comment from the audience.
Schemper’s Ace Hardware owner Ward Schemper, former Ripon Unified School District Superintendent Leo Zuber and real estate broker Marge Imfield moved separately to the podium and voiced their objections to any new taxes at this time.
Schemper said the sales tax alone would cost his hardware store customers about $10,000 a year at a time when the city is starting to see an upswing in business. He warned that it would be a “recessive tax” because such companies such as Guntert Steel could invoice their product at the delivery point where the tax might be less – cutting Ripon out of receiving any of those funds.
“You could be wasting your money,” he said referring to the $38,000 required to place the two items on the November ballot.
Zuber said the city has worked diligently to cut costs behind the scenes and now to go out and tell the community you want a one per cent sales tax – for what, he asked.
“This tax increase seems to be a reaction to the loss of revenue due to the recession. My concern is that it represents a permanent solution to a temporary problem. If we get back to normal in four years to the income we had two or even four years ago, we don’t need this tax,” Zuber insisted.
Marge Imfield added, “Education is by far the most important part of this adventure,” suggesting that the council needs to better inform the public of the need for the inflow of new tax funds.
She said that she is one who shops in Modesto and would be more prone to do so if the tax rate were lower in Ripon. She said she now has two choices for regional shopping – Manteca and Modesto – and she chooses Modesto because their tax is lower than Manteca.
Councilman Red Nutt said there is no way the city would ever get the sales tax passed in this economy – it’s like crying wolf, he added.
“I do feel we will get through this. We have to make do with what we have in the pot,” Nutt said.
“We have businesses in the downtown that are struggling. I shop at Schemper’s Hardware and I buy out of town. You only have to talk to him (Ward Schemper) and he will match out-of-town prices,” Nutt added.
“If it gets on the ballot, I will vote against it,” he lamented.
Councilman Dean Uecker said he had his mind made up before the meeting that he would support the proposed taxes, but after arriving he said he felt the council might be overreacting.
Councilman Charlie Gay also dissented saying he didn’t feel the taxes would be passed by the voters in November and the $38,000 to $40,000 used to put them on the ballot would have been lost money.
