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La Habra officials are asking voters to consider a 1% sales tax measure this November after cutting and deferring over $6 million in spending to balance their current fiscal year budget.
At Monday’s meeting, city council members voted unanimously to put the sales tax measure on the November ballot in a city where 70% of the $62 million general fund – the city’s discretionary pot of money – is spent on public safety.
According to the city’s latest approved budget, council members allocated 41% of the general fund – almost $26 million – to police while 29% or almost $18 million was designated for fire and ambulance services.
Officials argued that putting the measure on the ballot will allow voters to decide if they want to maintain the current level of city services and they publicly worried about the impacts not approving the measure could have on police response times and public safety.
Councilman James Gomez, a lifelong resident of La Habra, recalled what it was like to hear gunshots every night by his home and when the house of the late Dorothy Rush – a former city council member and anti-gang activist – was shot up.
“I remember having to dodge bullets when I was a store manager at Thrifty coming home and seeing all the gang members on every street,” he said Monday.
Gomez also questioned what would happen if officials made more cuts.
“70% of our budget goes there, we’re going to have to balance the budget, but I’ll tell you – you cannot cut a budget without cutting public service at that point,” he said
The decision in La Habra comes as a host of cities in the county including Orange, Buena Park and Seal Beach move forward with putting their own sales tax increase measures on the November ballot amid projected budget deficits and as local officials struggle to generate revenue to fund public services.
[Read: New Taxes? Increasing Revenue in Orange County Amid Budget Shortfalls]
The decision also came after the annual cost for the city to contract with Los Angeles County for fire services shot up by millions of dollars.
Measure T & The New Proposed Sales Tax Measure
If approved, the measure is expected to generate over $7.8 million more annually than the current 0.5% sales tax measure in place, dubbed Measure T, for a total of $15.6 million.
Measure T is a 0.5% sales tax approved by La Habra voters in 2008 that is expected to sunset in 2028.
This year, that tax is expected to generate 13% of the general fund revenue, according to a staff report.
The new measure, if approved, would bump the 0.5% current sales tax to 1% and would have an evergreen nature to it, where it could only be ended by another vote of the people.
That same night, council members voted unanimously against freezing budgeted vacant positions across city departments.
La Habra’s Rocky Budget & A Costly Fire Contract
In June, La Habra officials voted to approve the city’s 2024-25 fiscal budget with over $6 million in cuts and deferrals – slightly more than 10% of the general fund – to address a deficit after the annual cost for fire and paramedic services shot up by millions of dollars.
Those cuts include security guards at the local skatepark, programs like city CPR classes, a reduction in movies at the park summer events, a reduction in splash pad staffing and over $2 million from the police department by freezing 10 budgeted vacant positions.
[Read: La Habra Nixes Skatepark Security Due to Rocky Budget]
“These recommendations were made in order to offset the $3.2 million increase in the Los Angeles County Fire Department fire services contract, new unfunded pension liabilities caused by an inability by CalPERS to meet their targeted returns and increasing labor, operating and maintenance costs across all city departments,” reads the city’s 2024-25 fiscal budget.
The north OC city is paying over $14 million annually for their current fire services contract and according to a staff report costs could continue to climb up $600,000 more a year.
City officials also shut down one of their fire departments last year to lower the contract cost, according to a staff report.
For around 20 years the city has contracted with the LA County fire department for their fire services with an agreement to split the cost of the city’s fire stations 50/50.
City Manager Jim Sadro said at Monday’s meeting that they expected to pay more going into the latest negotiations on the contract about a year and a half ago but not for the department to say the city would have to be fully responsible for the costs or they’d terminate the contract.
“It was, ‘hey, this is the new deal you’ve got to take it or leave it,’” he said.“I don’t think anybody – any reasonable person –would have expected LA County to come in and say, your costs are going up 100% effective immediately.”
Residents Sound Off on Proposed Sales Tax Measure
At Monday’s meeting, residents on both sides of the issue sounded off for around 30 minutes on putting the proposed measure on the ballot.
Some residents pleaded with officials not to put the measure on the ballot, arguing that they have to budget their own spending and make sacrifices in their daily lives amid a high cost of living and the city should do the same.
“We’re not going to get a raise to keep up with inflation so the same thing with you. You need to start cutting things that are luxury,” said Juana Avila, a resident, adding the city should have its own fire department.
Others pushed in favor of the ballot measure to maintain city services and public safety.
Noah Daniels, a representative of the La Habra Police Association, said without revenue the police department won’t be able to provide the level of services residents are used to.
“Don’t defund us,” he said. “Let us keep doing our jobs for you.”
Maria Mahecha, a city planning commissioner, said that budget cuts fall on the backs of city employees.
“Why should we ask our city employees to continue to bear the brunt of the shortfalls when a perfectly good solution is to vote for a ballot measure that will increase revenue in a way that does not place the burden on any one group of people,” she said.
“A sales tax increase is borne by all consumers that shop in our beautiful city.”
Moises Alonzo, a resident, said Monday that whenever there are budget troubles politicians always look for ways to encourage voters to raise taxes on the backs of residents.
“You can’t raise my taxes, but you can surely word it to make it sound like if I don’t pay we’re going to be in trouble,” he said.
Alonzo said not everyone has the luxury of asking for more money from their employer when things get tough.
“When the price of milk and the price of bread goes up, I don’t get to go to my employer and say, everything is more expensive, you got to give me more money,” he said.
“In my house, I cut things out of the budget.”
Hosam Elattar is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at helattar@voiceofoc.org or on Twitter @ElattarHosam.
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