HOLD THE HORSES, CLAYTON
Before Any Tax Increase, Show Us the Real Numbers.
For years, residents were told Clayton needed a tax increase, even while the City's books were still being reviewed, corrected, and clarified.
Budget forecasts were often built on questionable baselines, incomplete assumptions, and financial data many residents now believe should have been more carefully verified before being presented publicly as fact.
But were those projections accurate?
Many residents are no longer convinced they were.
Cleanup Is Underway, But the Work Isn't Finished
To their credit, the current Council and staff appear to have spent significant time:
- Reviewing contracts
- Examining prior spending
- Identifying accounting problems
- Strengthening financial controls
That work matters.
But despite those efforts, residents are still hearing mixed and sometimes conflicting financial messages.
The Numbers Still Keep Moving
Residents are now hearing that revenues may be softening, deficits could reach approximately $778,000, and new taxes may be necessary.
At the same time, many are asking a far more important question:
Is this really the right time to discuss a tax increase?
Or should the City first complete the financial cleanup and clearly establish its true revenue stream, actual expenses, and long-term financial position?
Questions About Property Tax Revenue
In California, most properties typically receive annual assessed-value increases of up to 2%, and when homes sell, reassessments often occur at significantly higher market values.
In a stable community like Clayton, property tax revenue would generally be expected to trend upward over time.
So when residents hear revenue may be down, reasonable questions follow:
- Is it a timing issue?
- A county allocation delay?
- A forecasting error?
- Misclassified revenue?
- Appeals or refunds?
- Or something else not yet explained publicly?
Questions About Sales Tax Revenue
It was reported at the last City Council meeting that online sales tax revenues were increasing.
So residents are asking: Why are we discussing a sales tax increase when revenues may actually be performing better than expected?
Residents are not saying the City has no financial challenges. What they're saying is simple:
Before asking taxpayers for more money, the public deserves accurate, verified, and transparent financial information.
Residents Want Answers
- What are the true reserve levels?
- What expenses have already been reduced?
- What new revenues are coming in?
- What liabilities remain unresolved?
- Where do the City's finances actually stand today?
These are not political questions. They are responsible taxpayer questions.
What About Investment Income and Reserves?
- What investment income is being generated from City reserve accounts?
- Why do reserve balances remain strong while deficit warnings continue?
- Which funds are restricted and which are available?
- What previously budgeted projects were never completed or spent?
Those questions deserve clear public answers.
Timing Matters
Rushing into a tax discussion before the financial picture is fully stabilized may be the wrong approach.
The City reportedly still maintains significant reserve funds that may help bridge short-term uncertainty while staff completes the hard work of correcting past issues.
That is one of the reasons reserves exist — stability during periods of uncertainty.
Before Asking Residents for More
Before any sales tax, parcel tax, or assessment measure moves forward, the City should first provide:
✔ Clean and transparent expense reporting
✔ Clear reserve disclosures
✔ Investment income reporting
✔ A corrected multi-year forecast
✔ A public explanation for why prior projections changed so dramatically.
Bottom Line
Residents are not saying "never."
They are saying:
Not yet.
Get the numbers right first. Finish the cleanup first. Then make the case.
Because until the books are clear, credible, and trusted...
Hold the horses.
— Clayton Watch Team
Great article. I agree 100%
ReplyDeleteThe more the numbers keep changing, the more people lose confidence. Clayton residents deserve clear answers, not moving targets.
ReplyDeleteMost residents don’t care about politics or personalities anymore. They just want honest financial reporting, accountability, and the truth. Why do the numbers keep changing?
ReplyDeleteMaybe someone on the “financial sustainability committee” could answer that question?
DeleteThis comment is true. All the personalities of the past are gone. A few people try to bring up politics from the past but that’s over with now. Clayton Watch should just stick to reporting facts. No more articles about Tamara or Holly. As for the numbers, why aren’t you guys parsing through the numbers? Staff has explained what happened and why the budget is in the red but there is nothing in the article about that. Why? It’s easy to say the numbers keep changing and ignore what staff has said. The public deserves to know all of the facts.
DeleteYes...the numbers have been changing. But the consistent message over many years has been there is a structural budget deficit. This was the message delivered in the civil grand jury report last year. And was contested by the council. In fact, the council said they did not need to investigate ways to increase revenue since it had already been done. And that is exactly what they are doing now...looking for ways to increase revenue. The council, in its gj response, also indicated they did not agree with the finding that there was high turnover. At this week's meeting Mayor Wan said that there is high turnover partially due to low wages paid. Instead of looking for a response from the court on the gj report maybe the council should revise its response.
ReplyDeleteI need to know the magnitude of the structural deficit before I can support a tax increase. I can’t support a 1 percent tax increase if a 1/2 percent tax increase will do the job.
DeleteSo real all the financials provided.
DeleteYep pretty ironic
DeleteI will support a tax increase when I am sure the budget projections are accurate. We have heard so many different budget deficits numbers over the last several years, I don’t have confidence the city has got it right yet. The council and staff have been doing a lot of great work, but they need to continue fine tuning the numbers before I can support a tax increase
ReplyDeleteGreat article Clayton Watch. City council it is your turn. Please provide answers to the questions raised by CW.
ReplyDeleteCC will not nor should not respond to these post on CW
DeleteAs much as I know that’s where a “Public Information Request” could come in handy. The city has the obligation to tell the citizens, the true story.
DeleteIt what is happening at CC meetings not the true story?
DeleteFunny how residents asking for accurate numbers and transparency are suddenly treated like the problem. Wanting facts before new taxes shouldn’t be controversial.
ReplyDeleteI think most of us would be OK with a sales tax increase but I agree with the writer of the article. The city needs to know what their income and expenses truly are. A sales tax alone won’t solve the problem, but it helps in the short short-term
ReplyDeleteMost of us truly love our little city. But the City Council should never ask residents for more money unless they can clearly explain the city’s finances and confidently show the numbers.
ReplyDeleteIf it takes additional time to fully straighten things out, then use a portion of the city’s reserves to bridge the gap and give staff the opportunity to provide accurate, understandable financial information to the public.
Residents deserve transparency, accountability, and facts before being asked to support any new tax or fee increase.
Why the rush? I totally agree with the person above.
DeleteExactly, there is no need to rush to judgment. Get the numbers right, then talk about a tax increase. Everywhere you look, some government entity is wanting a tax increase.
DeleteYou only get the chance every two years. Been talking about this for many years. How long does it take to "get the numbers right."
DeleteOne question: How much investment income is the City generating from its reserve accounts?
ReplyDeleteWith interest rates where they’ve been over the past several years, reserve funds should be producing meaningful investment income. The public deserves to know how much is being earned, where those funds are being allocated, and whether that income is being used to offset budget concerns before anyone starts talking about new taxes or fee increases. It’s our money, and we should put it to work.
The “cup of coffee” analogy at the council meeting was pretty funny. Maybe it sounds small when you compare it to a latte, but it feels a lot different when you’re buying a $70,000 car and that “small” tax turns into a $700 bill.
ReplyDeleteThat’s the problem with minimizing taxes through catchy comparisons. For many families, these increases add up quickly, especially while residents are still asking basic questions about reserves, investment income, and the city’s actual financial position.
Agree
ReplyDeleteFunny how we were told we needed more money before anyone could clearly explain where the current money was going. -Jim
ReplyDeleteSounds like the Nancy Pelosi playbook: approve it first, sort out the details later. Clayton deserves better than that.
ReplyDeleteI would have to agree with the article and the majority of the responses. The problem I see here in the last few council meetings is that both Kris and Dennis are playing a shell game. Council has clearly asked and requested direct deliverables from Kris and Dennis, yet they side-step, ignore, or skirt the issues. From my vantage point, it appears, let's say with Maintenance, an apparent lack of willingness to put together an overlay of the city, with a schedule of work done, to be done, priorities, and incidentals, such as a wish list, that has to stop. Also, the sniping between Denis and Kris should stop during council meetings. As far as the financials go, the numbers should not be bouncing all over the place at this point. And while I'm at it, why did our police chief run over the budget by nearly 200,000? Is he not aware of what goes on in his own department? Let's face it, if department heads can't figure out what is happening in their departments, we are in serious trouble. Please right the numbers now and stop having council members surprised by added items not in the packet and by itemized lines that don't line up. These should be easy tasks.
ReplyDeleteTotally agree. And they want more money? Hell no!
DeleteIf they are still cleaning up the mess left behind by the prior city manager, then fine, get it done properly.
ReplyDeleteBut don’t rush into asking residents for more money before the City can clearly explain where we stand financially.
Take the time. Fix the numbers. Get it right. Then come back to the public with the facts.
Stop blaming the past...Current CM has been there for well over a year. Should all be solid by now.
DeleteI would suggest talking directly with the City Manager. From what I understand, things were a real mess when he took over, and it takes time to straighten years of issues out properly.
DeleteBalancing budgets, reviewing contracts, correcting financial records, and rebuilding systems doesn’t happen overnight. Most residents simply want the numbers to be accurate before any major decisions are made. Getting it right is more important than rushing it.
How long do you need...been a year and a half
DeleteAs long as it takes. The bigger the mess, the more time it will take to clean it up. No need to rush.
DeleteLofthus made a comment in his first couple of months that the city had a revenue problem.
DeleteThe more you wait...the bigger the shortfall
DeleteInflation is real, and it impacts cities just like it does households. If the people of Clayton want to maintain the level of service and quality we’ve all come to appreciate, we also have to recognize that property and sales tax revenues don’t always keep pace with rising costs.
ReplyDeleteAt some point, something has to give, either reduced services or a thoughtful, modest adjustment in revenue. Most of us love this town, along with our police and city staff, and want to preserve what makes Clayton special. That means being open-minded to the idea that occasional increases may be necessary to keep things running at a high standard.
That said, I agree with the article and many of the comments—before asking residents for any increase, the City should clearly understand and communicate its financial position. Get the numbers right, be transparent, and then have an honest conversation with the community.
One major issue voters need to pay attention to is the potential “stacking effect” of multiple tax measures hitting at the same time.
ReplyDeleteIf every proposed increase passes, Clayton’s combined sales tax rate could look something like this:
Clayton's Current Rate: 8.75%
After Measure B (+0.625%): 9.375%
After proposed Bay Area transit tax (+0.50%): 9.875%
After proposed Clayton 1% increase: 10.875%
This stacking effect may become the single biggest challenge facing Clayton’s proposed 1% increase. Many voters who might otherwise support a local measure could reconsider once they see the cumulative impact laid out in comparison charts and opposition mailers.
Timing matters. Before asking residents for additional taxes, the City should first provide clear financial data, demonstrate long-term planning, and carefully evaluate how multiple tax increases together could affect public support and local spending.
If I buy a car today for $50,000 my tax bill would be $4,375. If I buy my $50,000 car after all the sales tax measures pass, my tax bill would be $5,437. An increase of $1,062 ( a 24 percent increase) Here is who gets the money: $500 goes to Clayton, $250 goes to Bart and $312 goes to the county.
DeleteYour car purchases are taxed where you live, not where you purchase the vehicle.
So, let’s assume we give them their proposed increase of 1%, what happens next year when they run out of money again? When does this broken formula ever stop? We need to learn to say “no” live within your budget. The waste in government is criminal and needs to be exposed.
ReplyDeleteSo, let me understand how this works. We are being asked to approve a 1 percent sales tax and we still do not know how much money the city needs to balance their budget. What happens if they don't need all this money? I am pretty sure they are not going to give it back to us. I am betting they will just figure out new ways to spend all the money and then come back for more. Politicians just love taxes. As one former president once said, "I have never seen a tax I did not like".
ReplyDeleteI have a great idea, let's pass a law that says whatever new tax the politicians push, they have to agree to be taxed at triple the rate.
Well..got all the numbers that we will get. Satisfied?
ReplyDeleteNo horses are being held...the ballot measures are progressing.
ReplyDelete