CRAZY LIKE A FOX?
Great Wolf deal may help Manteca catch up on services
If you want more services — police, firefighters, street maintenance and such — and don’t want to pay more taxes then you’d best root for the City of Manteca and Great Wolf Resorts to strike a final deal. The reason is simple. City services aren’t cost free. Someone has to pay for them.
Much ado is made about “the mess” and how it’s simply a matter of spending priorities to sort things out. Since the city can’t print money, what do you cut? Maybe shut the library and sell of a couple of parks to pay for two more officers? Cut a firefighter or two to free up more money to fix streets? Eliminate Parks & Recreation services to fix alleys?
While you can always find ways to do things more efficiently via technology, time management and empowerment strategies as well as harnessing the services of volunteers, let’s be honest. Manteca already had the lowest staffing ratio for comparable cities when it comes to police, firefighters and street maintenance staffing. Parks and Recreation crews already maintain significantly more park acreage per worker than in neighboring cities. And while clearing the bureaucratic process of weedy and unwieldy regulations may speed up some processes, it still won’t free a lot of money to hire more police or fire.
The sins of City Fathers before the Great Recession were rooted in their failure to scale back spending or increase taxes as city payroll costs were soaring while scoring political points by dropping the city’s $2.35 per month utility tax. It was masked by their addiction to bonus bucks collected from developers in return for sewer allocation certainty. The city burned through $11.9 million in bonus bucks to keep the general fund whole that covers the cost of day-to-day government while pushing the line that the additional cost slapped onto the price of a home was collected on the premise of growth helping provide additions amenities.
It wasn’t an intentional move. But much like drug addicts they couldn’t see the proverbial forest for the trees. Then Manteca got into a hole as other cities did when the rescission hit. Toss in the looming pension cost crush and you have Manteca’s current situation.
Manteca’s leadership — elected and otherwise — spent the past 10 years digging the city out from under unintended consequences of the previous 15 years. It was much like the adjustment after the city tethered on the abyss of bankruptcy in 1985 but with a big caveat: The rules of engagement as dictated by state and federal decrees had changed.
Government taxing and spending should be straight forward, but it isn’t. Some blame it on Proposition 13. In reality it is the contortion that politicians went through to placate voters after the fact as well as the inventive manipulation career bureaucrats came up with to keep the state whole at the expense of local government. If you want an example of insanity, just ask a city finance director to explain the State of California’s “triple flip” that hijacked local sales tax interest free when local governments were forced to make staffing cuts and the state kept on hiring.
While other cities were worried solely about treading water a decade ago, Manteca cutback as well but they also looked to the future to try and find a way out of the abyss and to assure they could make the city as immune as possible to the financial ravages Sacramento imposes.
It is when the idea of tapping into taxes generated by visitors’ dollars was born.
Put aside any distaste you may have for splitting tax revenue with a private enterprise for a minute in the name of being pragmatic. Great Wolf is Manteca’s Great Hope for a new day.
The conservative numbers call for Manteca to see a net gain of $1.7 million annually to the general fund primarily through its share of room taxes resort guests will pay after the first full year of operation.
If the city then takes the room tax from the current 9 percent in Manteca to the average 13.5 percent charged in most north state locales, the city would see an additional $2.85 million a year. That includes $2.35 million more from Great Wolf and $500,000 from other city hotels that collected in excess of $1 million in room taxes last year.
That’s $4.5 million more a year rolling into the general fund. The amount grows slightly each year then jumps significantly after 25 years when the tax split becomes history. Not that all of the money should go to police, but that’s enough to add 23 police officers or increase the current force by a third.
Meanwhile another tax split deal is nearing the end. It happens to be with Costco that would be Great Wolf’s neighbor should the deal go through. The city entered into a sales tax split with Costco to get them to drop plans to build another store in a nearby community and to come to Manteca instead. What was at stake was hundreds of thousands of dollars in sales tax Manteca residents were spending at the chain’s stores in Tracy and Modesto based on data tracked by Costco.
Costco wanted a permanent tax split. Manteca offered a tax split until the firm’s $10 million investment in Manteca was recouped. That will happen in the next 20 months or so. When it does, another $600,000 plus a year flows into the general fund of the equivalent of just over three more police officers.
If Manteca’s leadership is crazy then they are crazy like a fox.