CITY OF SANTA CLARA—Would continue the annual budget transfer of funds from City utilities to the general fund at 5% of gross receipts, until ended by voters, to protect essential services such as 911 response, police patrols, fire protection, etc. without raising taxes. Measure G requires a simple majority (50% + 1) to pass.
Fiscal Impact: Would continue to generate approximately $30 million annually.
Next Santa Clara County Measure: Measure H
Pro:
Proponents of Measure G argue that since 1980, about 5% of the gross electricity sales by the City's electric utility, Silicon Valley Power (SVP}, have been transferred to the general fund (this amount is currently around $30 million and it is a very stable source of revenue) and California voters passed Proposition 26 which requires such transfers to be approved by the voters. They argue that the City of Santa Clara currently has a nearly $20 million deficit in its general fund which has severely limited staffing levels and the services being provided, including public safety, parks maintenance and activities, and failure to pass Measure G will add roughly $30 million to our existing $20 million deficit and will force the City to make cuts to essential services.
A YES vote on this measure means: The annual budget transfer of funds from City utilities to the general fund at 5% of gross receipts would continue to protect essential services such as 911 response, police patrols, fire protection, etc.
Con:
No official argument against Measure G was submitted.
A NO vote on this measure means: The annual budget transfer of funds from City utilities to the general fund at 5% of gross receipts would not continue to protect essential services such as 911 response, police patrols, fire protection, etc.
The Santa Clara City Council has placed Measure G on the ballot which, if approved by the voters, would amend City Charter Section 1320 ("Utilities Fund") to clarify that a fixed sum of 5% of utility gross receipts shall be transferred to the City's general fund annually, continuing the voter-approved utility tax transfers that have occurred since at least 1980. The revenues derived by the City from this transfer are unrestricted and can be used for police and fire, parks and recreation, streets and sidewalks, and other general municipal services.
Background
In 1951, City of Santa Clara voters approved a City Charter amendment authorizing the partial use of utility rate revenues for City services. It was subsequently amended by the voters in 1980 to increase the transfer percentage from 4.5% to 5%. City Charter Section 1320 currently allows for a transfer from the City-owned utilities to the City's general fund·in an amount "not to exceed 5% of the gross receipts from such utilities." Pursuant to this charter section, transfers from the City's electric utility to the City's general fund have occurred annually since 1980 and have historically been for the full 5% of gross receipts.
After the adoption of the City's Charter provision, California voters approved Proposition 218 in 1996 and Proposition 26 in 2010, which amended the California Constitution to require that certain fees and charges must be approved by voters. To comply with changes in the law since the voters last took action in 1980, the City seeks express ratification by the voters of the transfer from the enterprise to the general fund in the fixed percentage of 5% of gross receipts.
The Measure
The proposed amendment to Section 1320 of the City Charter would delete the phrases "not to exceed" and "in payment for services rendered" from subsection (d) in order to clarify and establish the following: that the transfer percentage is fixed at 5%; that duplicative language is removed; that the voters are ratifying the existing practice of a fixed percentage transfer to the general fund, which is included in rate-setting calculations.
The utility transfer to the general fund is expected to continue to be approximately $30,000,000 annually, based and dependent upon historical transfer amounts, electric rate-setting, and electric usage levels. Actual transfer fluctuates with the utility's gross receipts.