ESCONDIDO — Most Escondido voters would support a citywide sales tax increase if placed on the November ballot, according to a recent survey of residents.
Roughly two-thirds, 62% and 68%, of a sample of 1,022 registered voters supported a one-cent sales tax increase based on a survey conducted by True North Research, Inc. The survey presented hypothetical ballot measure language to voters with two different options: either allowing the tax to end by voters or in 20 years, with more residents favoring the 20-year option.
The survey took place in May following the council’s direction in April to gauge voters’ interest in a possible sales tax increase.
City officials have debated a sales tax increase for some time in response to the city’s budget woes due to its state-required public employee unfunded pension liability fund, which obligates the city to pay between $15 and $22 million annually until 2044.
Without additional revenue, the city would need to cut police, fire, road maintenance and encampment cleanups. Meanwhile, in the survey, residents identified wanting additional public safety, infrastructure improvements and actions addressing homelessness to improve Escondido’s quality of life.
“Residents clearly want dollars spent on public works, safety and homelessness,” said Deputy Mayor Tina Inscoe.
While the survey showed that residents favored a one-cent sales tax measure, the City Council hasn’t decided whether to pursue a one-cent, ¾-cent or half-cent tax increase.
Escondido’s current sales tax rate is 7.75%, of which 7.25% is the statewide base rate and 0.50% is the SANDAG district tax. If adopted, Escondido would join National City, Del Mar, Chula Vista and Imperial Beach as cities with the highest tax rates in the county at 8.75% if a one-cent sales tax increase is approved.
Councilmember Consuelo Martinez noted that Escondido’s demographics are similar to those cities.
A one-cent sales tax increase would generate $28 million annually for the city.
La Mesa is currently the only city with an 8.5% sales tax rate, which Escondido would have if a ¾-cent increase is approved. If Escondido opts to go for only a half-cent sales tax increase, it will join the cities of Oceanside, Vista and El Cajon at an 8.25% sales tax rate.
Councilmember Mike Morasco cautioned that a countywide sales tax measure could limit Escondido’s ability to pass its own measure. Per state law, local tax increases are only allowed up to 2%.
Following a presentation of the survey results on July 13, Council directed staff to come back with a draft ballot measure. At least four council votes in favor of a ballot measure must be turned into the Registrar of Voters by Aug. 12.
Councilmember Joe Garcia suggested the ballot measure posed to voters lacks transparency about its connection to the unfunded pension liability fund. Though the survey did mention the need to do something about the fund in some of its questions, Garcia felt it wasn’t apparent enough.
“I think that fundamentally we have missed the point, and we have a major problem, and it’s been growing over the years… the plan has already been presented to us on how (the tax measure) is going to be spent, and it doesn’t have anything with the unfunded liability (fund),” Garcia said. “That is a very serious concern that I have.”
Mayor Paul McNamara disagreed the measure lacks transparency, noting that staff and the council have discussed the city’s unfunded pension liability fund for months during financial briefings.
“In the spirit of transparency, if they don’t vote for it, the quality of life in Escondido will go down, which it will because we will not have the money that we need to provide the quality of life at the current level,” McNamara said.
City Manager Sean McGlynn explained while it might be difficult to squeeze into the 75-word ballot measure language limit, the city can provide more insight regarding the city’s debt in education materials for the public.