Saturday, February 12, 2011

The TOT And Possibilities

"The TOT" is the Transitory Occupancy Tax- TOT revenues collected from two business within Rancho Palos Verdes and the TOT currently being collected from Terranea has been slated to be used for capital improvements.

Let's stop for a few minutes. What is the entity other than Terranea that provided TOT revenues for our city? Good question, easy answer for somebody living on the east side of R.P.V.

It's the Value Inn. Sure at about $45.00 per day, we don't collect much from the Value Inn. It is of course, directly behind one of the priciest stand alone restaurants in our city, Think Prime.

A few months before Terranea was scheduled to open, it's developer working with some of our Council members attempted to create a TOT rebate program where the actual rate of the TOT would be increased slightly and then some of the revenues would be rebated back to Terranea.

At the beginning of the process, the TOT was 10% of the 'rack rate' for a room scheduled for Terranea and in place at the Value Inn.

The idea was to raise the TOT to 12% and then rebate a portion back to Terranea to conceivably assist it with its opening and for a few years until it became a successful operation.

Had lien holders of notes on Terranea not concluded that a TOT rebate was not allowed, our city governors would have provided Terranea with taxpayer funds in the form of a partial rebate of Terranea's TOT.

Since the plan never went though, the established TOT of 10% still exists and those who believe the TOT is 12% are incorrect.

It has been noted that TOT revenues from Terranea were in the neighborhood of 2 Million Dollars for 2010 and are suspected to be in the 3 Million Dollar range for 2011.

*NOTE. For the record, I was one of the loudest and staunchest opponents of providing Terranea any rebate or taxpayer revenues. I may have been the only one in R.P.V. opposed to the rebate.

Now let's move forward to today. OUR representatives in Sacramento have stated outright that they are going after every dollar nailed down or not, from cities.

For 2010 the TOT collected from Terranea represents about 10% of our city's current budget.

I want the TOT to stay in R.P.V. We need the TOT to stay in R.P.V. We must find every conceivable way to keep all revenues currently set for city uses to remain for use in our city. This also includes any utility tax revenues our city collects.

Could becoming a charter city insure that our fund are protected? That is a good question and an important one. Sadly the answer is no. There is no guarantee that some TOT or other revenues can be held for city use, if Sacramento or the Federal Government come raid our accounts.

But and however, becoming a charter city MIGHT HELP attempt to keep monies from flowing out of R.P.V. and into Sacramento.

It is true that our residents are residents of the State of California and there are State requirements that must be met. We are citizens of California and R.P.V. and we voted folks into offices at both levels who are supposed to represent us above others.

The question of protecting city revenues from raids by Sacramento is a genuine question for debate regarding Measure C.

Opponents may tell you that there is no way to protect any funds and it is of no matter whether becoming a charter city does anything towards keeping or losing revenues.

This is one of my biggest points of debate with those opposed to Measure C and I stand firmly on the side of supporting any attempt to legally help to try and keep R.P.V. monies for R.P.V. use. I do feel that R.P.V. becoming a charter city will help assist efforts to stop or hinder any raids on city funds.

We may not be able to protect all the dollars but if becoming a charter city protects a good portion of dollars otherwise seized by Sacramento from us as a general law city, I stand in support of Measure C.

Now here is something that you may not know or want to know.

There is talk among those with more response from authorities than I have that there may be a push beginning after the March election to raise sewer fees and possibly some parcel tax increases via a vote of the people.

I am sure you all already know that Governor Brown want a vote on extending the tax increases levied some years ago via a vote scheduled for this coming June.

It is not unbelievable that the June vote could see a increase of sewer fees vote along with Brown's tax extension. Also there could be a measure regarding an increase in parcel taxes within our city, perhaps as early as June.

Supporters and opponents of Measure C are looking very closely at that measure and may not be focused on what just might happen three months after the March 8 vote.

But I am concerned. It is another reason I feel so strongly about taking proactive steps to gain stronger footing on possibly keeping dollars within our city.

If we can't save TOT and other fees AND voters vote to extend or increases taxes and fees, our city will be in deep trouble not far down the road.

San Ramon Canyon must be fixed. No question. No debate whether it must be fixed or not. Too much time has exhausted more talk and long study of the problem. It must be fixed.

I think we may get a new friend in Washington to help find Federal funding pieces, but I will write about that in the near future.

So, San Ramon Canyon must be fixed and the price tag is currently set around 21 Million Dollars.

How long have our residents talked about a new civic center/City Hall? My son who lives in Australia may have been in elementary school when talks about replacing the structures began.

A new City Hall will take municipal dollars that we do not have right now.

Losing even a portion of our TOT and utility users tax revenues would be very harmful for both San Ramon Canyon and consideration over a new City Hall.

I just mentioned two of the major projects requiring taxpayer dollars we don't have.

We must never lose sight of something that may be minor as far as budgets go, but is something we constantly deal with that no other city has to deal with in the Western Hemisphere. .8 miles of Palos Verdes Drive South.

We have parks needing improvement. we have infrastructure threats that continue to plague a city built on bentonite and not having all that much level land in the first place.

We need to find ways to protect our city revenues. One possibility that I support is having R.P.V. becoming a charter city.

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