This November, Oceansiders will vote on Measure S, a new sales tax measure that would add to Measure X to raise much-needed funding for the city’s crumbling infrastructure and backlog of municipal projects.
Oceanside has approximately $638 million in unfunded projects. These include a vast array of critical infrastructure needs, such as maintaining 804 lane miles of roads, 591 miles of water pipes, 480 miles of sidewalks and 450 miles of wastewater pipelines, plus storm drains, utility lines, landscaping and irrigation on easement properties.
These massive liabilities stem from suburban sprawl that began in the 1950s and continues today with neighborhoods like North River Farms.
Oceanside has developed nearly every available parcel into the lowest-density housing possible: detached single-family homes. The mismatch between property tax revenue from these homes and the cost of maintaining the infrastructure serving these neighborhoods is the main culprit behind our structural insolvency.
Oceanside is not alone in its financial woes. Thanks to voter-approved Proposition 13, passed in 1978, California, its 483 incorporated cities and its school districts are now structurally insolvent. Proposition 13 limits the amount of property tax that can be collected each year, pegging it to a home’s value when it was last sold. That means a house last sold in the 1970s is assessed property taxes today that reflect only limited annual increases from its original assessment.
However, the costs of maintaining our state and municipal infrastructure — and schools — are not based on prices from decades ago. They reflect today’s much higher market rates. Each year, the gap between property tax revenue from suburban homes and the cost of maintaining those very suburbs widens, and cities sink deeper into fiscal insolvency.
To “fix” this deficit, a growing number of cities across California have passed local sales tax measures, increasing the sales tax on goods and services within city limits. Oceanside already has one called Measure X, which generates approximately $19 million per year, but its revenue fluctuates depending on spending within city limits each year. In a poor economy, that revenue would drop significantly. Voters can also reject Measure X whenever it comes up for reauthorization.
But Measure X is tackling only a fraction of Oceanside’s massive backlog of unfunded projects. After seven years of Measure X funding, the city still has one of the worst pavement condition indexes in the county, with a score of 61 out of 100, the equivalent of a D-minus grade. Only La Mesa and Lemon Grove have worse roads.
Big-bet projects like the Coast Highway Corridor, which would bring much-needed traffic calming to Pacific Coast Highway, have been in limbo since 2009. The Oceanside Police Department has been “temporarily” housed in an old Mega Foods grocery store since 1999. The walled-in Buena Vista Lagoon, now a mosquito-infested freshwater lake, needs about $150 million to be restored to a proper saltwater lagoon.
The city’s planned Wildlife Corridor Planning Zone was abandoned for decades, with dozens of “soft-line preserves” that the city planned to protect for conservation but never did. The city’s hardline nature preserves are filled with invasive plants, and no funding mechanism exists to remove them. A contractor-prepared report identified a need for three additional public parks, but the city never built them.
The city can’t even enforce its own nuisance vegetation ordinance or maintain its landscape easement properties, which are all bankrupt.
After-school programs for disadvantaged youth at John Landes Community Center were terminated for 14 years. Our traffic calming program was terminated for a decade. The list goes on. Dozens of volunteer groups in Oceanside donate their labor to revive specific abandoned projects, but without official funding, it’s an uphill battle.
California cities have an alternative to sales tax measures: rethinking detached single-family homes as the primary generator of municipal property tax revenue — the foremost source of our city’s budget. This means other types of housing should take priority over single-family homes.
Missing middle housing, such as duplexes, triplexes, fourplexes, townhomes, courtyard apartments and accessory dwelling units, as well as larger housing projects like midrise condos and mixed-use developments, is illegal to build on 90% of our residential land because of outdated zoning laws. Denser housing with smaller footprints downtown and near public transit increases a city’s general fund revenue far more than any sales tax measure, with minimal new infrastructure costs.
More residents bring a larger tax base that naturally generates more property tax and sales tax revenue without raising the tax rate for any individual resident. In other words, the city can become financially solvent again without resorting to increasing taxes on its current residents.
Because this alternative works worldwide, California mandates these housing types through laws like SB 79, SB 9, SB 35, AB 2011 and the Housing Accountability Act. However, our City Council often ignores, sidesteps or kneecaps these housing laws to cater to a very specific group of constituents: legacy homeowners.
Building more housing could lower the resale value of single-family homes, the primary financial asset of these residents. So while Oceanside’s leadership could simultaneously tackle our housing crisis, reduce annual increases in rents and home prices and generate the revenue needed to maintain our city, it has instead done everything in its power to ensure that newer, denser housing with smaller footprints is not built.
Our council tried to cripple the Oceanside Transit Center, the largest housing project in the city’s history, by demanding a complete redesign on a six-week turnaround. City staff were so uninformed about current ADU laws that residents came to the City Council to complain that their ADU plans had been rejected even though they had followed state law to the letter.
The council placed a density cap on downtown, effectively halting new housing applications there. Applications have been filed for zero new units so far in 2026, compared with 1,508 in 2023, 877 in 2024 and zero in 2025.
The city’s 1,000-page General Plan Update, 10 years in the making, even has an introduction that states “maintaining the integrity of existing single-family residential neighborhoods” and then proceeds to explain how all new housing in Oceanside should be placed along three high-speed, high-fatality stroads.
The city even submitted the most egregiously hostile SB 79 exemption plan in our state, asking that every parcel of land near public transit be exempted from this new housing law—a stunt that will certainly land it in court. The city dragged its feet on cannabis licenses while other cities were making millions in sales and property tax revenue from cannabis vendors.
Oceanside has made no attempt to reform zoning, remove parking minimums, eliminate minimum setback requirements or minimum lot sizes, allow fourplexes by right, adopt a form-based code or create an ADU bonus program like the one we saw in San Diego. All of these are well-proven policies that sustainably increase municipal revenue without resorting to higher sales tax rates.
So does the city of Oceanside need more money? Absolutely — $638 million more, to be precise. Should it come from doubling up on regressive sales tax measures? Certainly not. The Oceanside City Council should exhaust all possible avenues before resorting to another sales tax measure. Sales tax measures are regressive, unsustainable and underpowered. They unfairly affect our poorest residents and those on fixed incomes, including our growing senior population.
GT Wharton is an economist and co-founder of Strong Towns Oceanside.
