City’s utility user tax up for renewal
BRAWLEY — This city plans to put a utility tax up for renewal in the 2021 special election.
The city’s utility user tax (UUT) is set to expire on May 31, 2022, unless it is renewed by voters on a 2021 ballot measure, a city staff report explained.
After receiving a presentation on the UUT, the Brawley City Council on Tuesday unanimously approved having the city draft a resolution with language for the ballot measure.
While the UUT won’t expire until next year, there is a deadline the city must abide by in order to get the measure in for the Nov. 2 special election.
The UUT, which has a current rate of 4 percent, was last approved by voters in 2017, the report said.
The tax applies to users of utilities such as electricity, natural gas, cable television services, water, sewage, garbage collection and landline phone service.
The city heavily relies on the funding from this UUT, as it currently generates approximately $1.9 million per year in revenue for the city. This equates to about 9 percent of all general fund revenues for the city.
If the UUT is not renewed, then city staff will have to develop a contingency plan to reduce city services.
“The loss of these dollars, combined with economic constraints and increased external requirements, would disable the city’s ability to continue providing the same level of services,” the report stated.
This tax makes up 19 percent of the city’s overall tax revenue per year (approximately $10 million).
“That’s a big amount of our tax revenue for the city,” the city’s Finance Director Karla Romero said.
The city implemented the tax in 1991 after the state diverted revenues from local agencies to state programs and priorities.
Since then, the UUT has provided the city with funding for essential services, such as police, fire and the maintenance of parks and public buildings, including libraries, the senior center and recreational facilities.
The city said the importance of the tax is underscored by the fact Brawley provides its own municipal services, including police, fire, library and water.
“The UUT revenue helps the city pay for local services, rather than rely on other agencies to provide these services,” the staff report said.
The city has renewed this tax seven times: In 1991, 1992 and 1996 via ordinances and via ballot measures in 1998; 2005, 2011 and 2017.
Following Tuesday’s vote, the City Council will discuss and potentially adopt the draft ballot measure during its June 1 meeting.