Manteca Proposes 1% Increase Sales Tax for November Ballot
August 1, 2020 at 6:06 pm
A measure for the city of Manteca to increase the sales tax by 1% has been added to the November 3rd ballot to fund general city services. Manteca’s sales tax is currently 8.25% and currently accounts for 12% of the city’s revenue, including 30% of the general fund budget. The measure would generate approximately 12 million dollars a year, on top of the $22 million already generated by the sales tax.
Image courtesy of the Manteca Bulletin
Manteca’s sales tax was last altered in 2017, when it decreased from 8.5% to 8.25% due to changes in state and county rates. Voters also approved Measure M back in 2006, which enacted a 0.5% increase that went towards public safety funding. The proposed hike would make it the highest in San Joaquin County, passing Stockton’s current 9% rate.
However, the city has become increasingly strapped for funding due to the coronavirus pandemic. San Joaquin County’s unemployment rate was 15.9% in June, and sales tax revenues have significantly dropped due to business closures and stay-at-home orders. Hotel room taxes, gas taxes, and even business licenses have also been affected, per the Manteca Bulletin.
Manteca is expected to draw on its $18 million in general fund reserves to avoid layoffs or pay cuts. This totals almost 40% of its general budget, which amounted to $46 million in the 2019-2020 fiscal year. The standard reserve size for most cities is roughly 25%. However, areas of concern remain, particularly public safety. Despite the revenue from Measure M, which was projected to be $7.3 million from 2019-2020, there might not be enough reserve funding for the measure to cover the 33 police officer and firefighter positions. It is possible that the gap will be filled by the considerable general fund reserves, but those will likely face a decrease in revenue as well due to drops in income from sales, gas, and hotel taxes.