news story / By Ryan Burns

Desperate Times

Eureka’s budget hopes rest on one of the least popular moves in politics, a tax hike

(Oct. 7, 2010)  Eureka’s proposed new tax — a half-percent sales tax hike that will appear on the Nov. 2 ballot as Measure O — resembles a classic paradox, the one that asks what happens when an irresistible force meets an immovable object. The force, in this case, is nationwide public opposition to new taxes, as exemplified by the ascendancy of the Tea Party and the anticipated drubbing of Democrats in next month’s midterm elections. The object: community support for key public services, including emergency medical services, road maintenance and, most importantly, public safety.

That’s how Measure O’s proponents are framing the issue, anyway — as a choice between accepting this new tax burden or placing our men and women in blue at risk — and an examination of the City’s battered budget provides ample evidence to support their view. In recent years, the twin fronts of rising pension costs and lower sales tax revenues have combined to create a perfect storm, forcing the Eureka City Council to throw beloved programs (and employees) overboard while raiding every fund at its disposal in order to balance the budget.

The 2010-2011 budget, which was passed in July by a 3-2 vote, employs a number of desperate measures to counter what would otherwise have been an estimated $4.5 million budget shortfall. These measures include staffing cuts in programs from facilities maintenance to parks and recreation; the elimination of funding for all outside groups, including many programs for seniors; delayed purchasing for all capital expenditures (besides five new police cruisers, the purchase of which had already been postponed by a year); a raid on roughly $1.7 million in one-time monies, including employee retirement accounts, which will need to be accounted for later; and cutting more than $1.5 million from the public safety budget, in part through hiring freezes and staffing reductions like the sacrificial early retirement of Eureka Fire Department Chief Eric Smith.

Measure O would go a long way toward alleviating the pain of these cuts by providing the City with an estimated $3.4 million in annual revenues for the next five years, after which, barring re-authorization by voters, the half-cent hike would sunset. The measure would raise Eureka’s total sales tax rate to nine percent, and the revenue it generates would be monitored by a citizens’ oversight committee.

“I think Measure O could be a turning point for the City,” Eureka City Manager David Tyson said Tuesday. Voters, he said, are essentially being asked to decide what level of public service they want and how much they’re willing to pay for it. If they support Measure O, then future City Councils will have more options available for funding public programs related to police, fire, emergency medical services, road maintenance, environmental programs, the zoo and city parks. And if they vote no? “The Council will be looking at all those programs for further cuts,” Tyson said.

While the prevailing national mood is fervently anti-tax, there has been no formal opposition to Measure O. In fact, the one guy you can usually count on to challenge such tax-hike proposals — Leo Sears, former chairman of the Humboldt Taxpayers League and current member of Eureka’s Finance Advisory Committee — is chairing the campaign to pass Measure O. In 2004 Sears led a vigorous and successful effort to vote down a countywide tax-hike proposal known as Measure L, but this time around, Sears believes the situation to be much more dire. “I was saying, ‘L No’ … . Now I’m saying, ‘O Yes,’” he quipped.

The reason for this change in tune is simple, he explained: In 2004, the City didn’t really need the money, whereas now it does. “In this particular case, it’s either I go for this tax or the [Eureka Police Department’s] POP [problem-oriented policing] program goes away, and they’re gonna be closing down a fire station,” he said. It would actually be better if somebody were opposing the measure, he said, because then he could have a formal debate on the issue. “Unless we can get out and get the people to understand what this tax is and what it means, they’re just going to open that ballot, see a tax and say ‘no,’” Sears said.

Soon-to-retire Eureka Fire Department Chief Eric Smith would neither affirm nor debunk Sears’ prediction about closing a fire station, though he admitted that it’s certainly one undesirable possibility among many should Measure O fail. While his position with the City prevents him from officially endorsing the measure, Smith said his department is already woefully understaffed and underfunded. Recommended minimum daily staffing for the EFD, according to a 2007 fire service consulting firm report commissioned by the City Council, is 16. “We’re currently down to 10,” Smith said. And those firefighters are subject to ever-increasing risks thanks to deferred maintenance and depleted, outdated protective equipment.

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