City government has lots of income sources
Revenue from a wide assortment of taxes and fees is the lifeblood of Yorba Linda’s city government, providing the cash required to pay for municipal services, perhaps most importantly the $12 million that finances round-the-clock police protection.
Yorba Linda’s residents placed a priority on low taxes beginning with incorporation in 1967, when the winning candidates for the first City Council promised cityhood voters “no city property tax”—a vow kept during the first 13 years of the city’s existence.
But passage of Proposition 13 in 1978 left Yorba Linda with no piece of the reconstituted property tax pie, so 27-year City Manager Art Simonian lobbied the state legislature for a special law granting the city 10 percent of property taxes collected within city limits.
Property tax revenue has grown from $1.5 million in the first year to a predicted $12.8 million for the current fiscal year, now the largest revenue source for the city’s general fund, which expects to take in $27.5 million through June 30, 2012.
This year’s property tax income will show a small increase of about $70,000 over 2010-11 due to “continued growth in new residential housing slightly offset by declining values and fewer reassessments due to property tax appeals,” city Finance Director Dave Christian reported to council recently.
The second largest source of general fund revenue comes from the one percent portion of sales taxes collected by local businesses. Christian noted that the expected $5.4 million is about the same as last year, with a slight increase to $5.5 million anticipated for 2012-13, representing “the upward trend in spending as the economy slowly rebounds.”
The city’s third-largest pool of general fund revenue is a category Christian calls “other taxes and franchise fees,” which is expected to decline nearly $200,000 to $2.6 million, primarily due to the state eliminating $150,000 in motor vehicle fees.
Included in this category are hotel-motel occupancy and property transfer taxes, business license fees and the franchise fees residents pay on utility, trash and cable television bills.
Fees paid to the Recreation Department are expected to pull in nearly $2.5 million this year from a variety of programs provided children, teens and adults and facility rentals. More income comes from assorted charges and fees and special and restricted sources.
And as anyone with a bank account is aware, income from interest-bearing deposits is down considerably. Christian expects interest income to decline to $250,000 this year, noting that “revenue from this source has not been this low for a long time.”
The city’s separate capital improvement budget, with $12.7 million in spending expected in 2011-12, receives revenue from several sources, including the county Measure M sales tax, gasoline taxes, building reserve, traffic and park funds, other agencies and grants, general fund reserve and $3.3 million transfers from redevelopment and library funds.
The Redevelopment Agency is funded by the increase in property taxes from project areas ($21 million anticipated), and the library has separate property tax income, a remnant from the library’s 1914-85 status as an independent district (collecting $4 million this year, with $3.3 million saved from past years).
All told, at least 34 tax and fee categories fund city services, representing quite a change from the minimum-tax talk of early leaders in this once-rural community.
Yorba Linda’s residents placed a priority on low taxes beginning with incorporation in 1967, when the winning candidates for the first City Council promised cityhood voters “no city property tax”—a vow kept during the first 13 years of the city’s existence.
But passage of Proposition 13 in 1978 left Yorba Linda with no piece of the reconstituted property tax pie, so 27-year City Manager Art Simonian lobbied the state legislature for a special law granting the city 10 percent of property taxes collected within city limits.
Property tax revenue has grown from $1.5 million in the first year to a predicted $12.8 million for the current fiscal year, now the largest revenue source for the city’s general fund, which expects to take in $27.5 million through June 30, 2012.
This year’s property tax income will show a small increase of about $70,000 over 2010-11 due to “continued growth in new residential housing slightly offset by declining values and fewer reassessments due to property tax appeals,” city Finance Director Dave Christian reported to council recently.
The second largest source of general fund revenue comes from the one percent portion of sales taxes collected by local businesses. Christian noted that the expected $5.4 million is about the same as last year, with a slight increase to $5.5 million anticipated for 2012-13, representing “the upward trend in spending as the economy slowly rebounds.”
The city’s third-largest pool of general fund revenue is a category Christian calls “other taxes and franchise fees,” which is expected to decline nearly $200,000 to $2.6 million, primarily due to the state eliminating $150,000 in motor vehicle fees.
Included in this category are hotel-motel occupancy and property transfer taxes, business license fees and the franchise fees residents pay on utility, trash and cable television bills.
Fees paid to the Recreation Department are expected to pull in nearly $2.5 million this year from a variety of programs provided children, teens and adults and facility rentals. More income comes from assorted charges and fees and special and restricted sources.
And as anyone with a bank account is aware, income from interest-bearing deposits is down considerably. Christian expects interest income to decline to $250,000 this year, noting that “revenue from this source has not been this low for a long time.”
The city’s separate capital improvement budget, with $12.7 million in spending expected in 2011-12, receives revenue from several sources, including the county Measure M sales tax, gasoline taxes, building reserve, traffic and park funds, other agencies and grants, general fund reserve and $3.3 million transfers from redevelopment and library funds.
The Redevelopment Agency is funded by the increase in property taxes from project areas ($21 million anticipated), and the library has separate property tax income, a remnant from the library’s 1914-85 status as an independent district (collecting $4 million this year, with $3.3 million saved from past years).
All told, at least 34 tax and fee categories fund city services, representing quite a change from the minimum-tax talk of early leaders in this once-rural community.
posted by Jim Drummond at 12:00 PM
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