Ballot Measure DD. (Information Only) September/October 2016

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Maurice Miller
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1 Ballot Measure DD (Information Only) September/October 2016

2 Agenda What is Measure DD? Why is Measure DD needed? Why Sales Tax Instead of Another Tax? How Will the Funds be Raised? How Will the Funds be Spent? 2

3 What is Measure DD? 1 Local Add-on Sales Tax Measure Current rate in Menifee is 8.0% Statewide average rate is 8.5% Sales Tax funds Police, Fire, Parks, Public Works and the general operations of the City If enacted, Measure DD will generate $6.2 million annually Local control, not subject to State takeaways Until ended by voters 3

4 What is Measure DD? Ballot Measure Language MENIFEE PUBLIC SAFETY/TRAFFIC CONGESTION RELIEF/VITAL CITY SERVICES MEASURE. Shall Ordinance of the City of Menifee to reduce traffic congestion; improve/repair local interchanges / overpasses / streets / roads / bridges / potholes; maintain local police / fire protection / paramedics / emergency response times; prevent cuts to senior/disabled/youth programs; and provide other general services by enacting a 1 sales tax providing $6.2 million annually until ended by voters; requiring annual independent audits, all funds spent locally, be adopted? 4

5 Sales Tax Distribution Sales Tax Rate = 8% $1 Purchase = $0.08 Sales Tax State of CA 4 ¼ Cent K-12/Community Colleges Education Protections City of Menifee Riverside County 12.5% Transportation Commission 6.25% Riverside County 2 ¼ Cent Riverside County Transportation Commission ½ Cent Public Safety Transportation Mental Health/Welfare County Transportation City of Menifee City Services (Police, Fire, Riverside Parks, etc.) 1 Cent County State of CA 28.1% 53.1% 5

6 Sales Tax Example State $ % Sales Tax County New Golf Clubs = $385 8% Sales Tax = $ =$30.80 $10.53 City $3.85 State $2.97 8% Sales Tax County Sit Down Dinner = $70 8% Sales Tax = $5.60 =$5.60 $1.93 City $0.70 6

7 Where Do Your Property Taxes Go? SCHOOL DISTRICTS $0.59 RIVERSIDE SPECIAL COUNTY DISTRICTS $0.12 $0.16 CITY OF MENIFEE $0.13 $0.06 Goes to GF $0.06 Goes to Fire

Why is Measure DD Needed? The City s 5-Year Financial Forecast indicates a looming structural deficit Expenditures are outpacing revenues Currently, Menifee is operating with a $2.

8 Why is Measure DD Needed? The City s 5-Year Financial Forecast indicates a looming structural deficit Expenditures are outpacing revenues Currently, Menifee is operating with a $2.4M deficit (expenditures over revenue) Imbalance due to added Public Safety responsibilities, rising cost of Pubic Safety services & continued State takeaways (VLF, Gas Tax $) Menifee is one of only 4 cities, out of 482, not receiving Vehicle License Fees (VLF) because of policy error in Sacramento Menifee residents pay VLF annually, yet the City receives none of these fees that all other cities in CA receive (478 cities in CA). This amounts to a loss of $50 per capital based on population (89,000 in Menifee) $50 x 89,000 = $4,450,000 this year alone $21 Million lost in revenue since 2011 Measure DD will ensure continued high quality of life and fund vital services 8

9 VLF Loss Hurts Menifee Vehicle License Fees (VLF) $40,000,000 $31,550,550 $32,981,500 $30,000,000 $23,826,850 $21,432,050 $20,000,000 $16,974,80 $10,000,000 $3,182,400 -$21,358,500 $- $(10,000,000) Temecula Hemet Lake Elsinore Canyon Lake Perris Murrieta Menifee $(20,000,000) $(30,000,000)

10 5 Year Financial Forecast Current 2016/2017 FY Budget Gap ($2,414,960) 45,000, ,000, ,000, GENERAL GOVERNMENT FIRE POLICE PROPERTY TAX SALES TAX FRANCHISE FEES DEVELOPER FEES TOT -$2,699,996 -$2,145,695 $20 MILLION DEFICIT -$4,413,934 -$5,072,180 -$5,754,506 30,000, Previous Year 25,000, ,000, ,000, ,000, $5,000, $0.00 EXP REV EXP REV EXP REV EXP REV EXP REV EXP REV

11 General Fund Revenues Total Budget Revenues $29,380,373 $11M Property Tax 38% $7M Sales Tax 24% $2.6M Other 10% $3M Franchise Fees 10% $5.6M Development Fee 19% 11

FY 16-17 Annual Operating Budget General Fund Operating Expenditures $31,795,333 $21,007,157 PUBLIC SAFETY 66% CITY COUNCIL 1%

12 FY Annual Operating Budget General Fund Operating Expenditures $31,795,333 $21,007,157 PUBLIC SAFETY 66% CITY COUNCIL 1% COMMUNITY SERVICES 2% ECONOMIC DEVELOPMENT 2% PUBLIC WORKS 8% BUILDING & SAFETY 5% ADMINISTRATION 11% COMMUNITY DEVELOPMENT 5% 12

13 Increasing Cost of Police & Fire 50.00% 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Price of Public Safety Police *Status Quo-No additional officers Police- Increases 5-7.5% per year Fire-Increase 5% per year 13 Fire

14 Why Sales Tax? Council explored the impacts of increasing other avenues and found they were insufficient to meet revenue demands Local control without State takeaways Sales Tax is paid by residents, businesses, & non-residents (visitors) 700,000 population within 15 miles of city center (Newport/Haun) 85,000 vehicle trips per day on I-215 between Scott & Mcall 58,000 vehicle trips on Newport 31,000 vehicle trip on Scott Estimated ½ or more would be paid by non-residents (visitors) 14

15 How Will Funds Be Raised? Requires voter approval on November 8 th Simple majority needed for approval (>50%) Added 1% Sales Tax (1 on each dollar spent) collected at time of sale Exempts most household products like prescription medicines, healthcare, groceries & utilities Merchants remit tax to the State, who then distributes to City on quarterly basis 15

16 How Will Funds Be Spent? Maintain & Prevent Cuts to: Reduce Traffic Congestion Connect traffic signals for more effective timing Add necessary traffic flow assistance Signals, stop signs, signage, enforcement Maintain Aging Infrastructure Roads, parks, sidewalks Fund Capital Improvements Scott Interchange Holland Overpass Bradley Bridge Murrieta Road (N-Lane Configuration) Repair Goetz 16

17 How Will Funds Be Spent? (CONTINUED) Maintain & Prevent Cuts to: 911 Emergency Response Times Maintain 4 minute average Fire/Paramedic response time Add officers for patrol & traffic congestion relief Local Paramedic, Police, & Fire Protection Maintain Public Safety Services Backfill 20 officer vacancies consistent with population growth Maintain Fire staffing in city, and keep paramedics on all fire engines Preserve Fiscal Stability & High Quality of Life 17

18 Questions? For additional information/questions please visit Or your questions to 18

POST MID-YEAR BUDGET REVENUE DISCUSSION & DIRECTION AGENDA ITEM 12.1 CITY COUNCIL MEETING APRIL 6, 2016

POST MID-YEAR BUDGET REVENUE DISCUSSION & DIRECTION AGENDA ITEM 12.1 CITY COUNCIL MEETING APRIL 6, 2016 MENIFEE PROFILE INCORPORATION: 2008/09 2015/16 AREA: 46.8 SQ MILES 46.8 SQ MILES POPULATION: 64,328