Agenda Item: 2
CITY OF SANTA CLARITA
AGENDA REPORT
NEW BUSINESS
CITY MANAGER APPROVAL:
DATE: May 12, 2026
SUBJECT: MEASURE ER: THE ESSENTIAL SERVICES RESTORATION ACT
FOR LOS ANGELES COUNTY
DEPARTMENT: City Manager's Office
PRESENTER: Masis Hagobian
RECOMMENDED ACTION
City Council discuss and provide direction to staff.
BACKGROUND
The Essential Services Restoration Act for Los Angeles County (Measure ER) is a one-half percent (0.5%) general sales tax that was placed on the June 2, 2026, ballot by the Los Angeles County (County) Board of Supervisors. The motion to place the measure on the ballot was introduced by Supervisors Holly Mitchell and Hilda Solis and was approved (4-1), with Supervisor Kathryn Barger voting no. If approved by a simple majority of County voters, Measure ER would go into effect on October 1, 2026, and sunset on October 1, 2031.
Measure ER was presented to the City Council Legislative Committee on April 28, 2026. The City Council Legislative Committee expressed concerns related to the proposed increase to the sales tax rate and potential impacts to overall affordability throughout the County.
As described in the motion, the intent of the measure is to support County healthcare services that have recently lost federal funding as a result of the passage of House Resolution 1 (2025) (H.R. 1), also known as the “One Big Beautiful Bill Act.”
The County projects a revenue loss of approximately $2.4 billion over the next three years due to a cumulative fiscal impact of federal laws and policies imposed since January 2025, including H.R. 1, Executive Orders on grant oversight, and new federal terms and conditions restrictions.
The County Department of Health Services is projecting federal revenue loss exceeding $700 million per year by 2028-29 as a result of the federal impact of H.R. 1. Additionally, the County Department of Public Health is forecasting a $42 million deficit in fiscal year 2025-26 and anticipates losing $200-300 million in the next three years due to H.R. 1.
This measure establishes a nine-member citizens oversight committee and requires an independent auditor to prepare a report for each year until all funds are expended. The County anticipates the measure to generate $1 billion, annually.
The current sales tax in the City of Santa Clarita (City) is 9.75 percent. If this measure were to pass, the City’s sales tax would become 10.25 percent. A higher sales tax rate, especially in comparison to neighboring cities in other counties with a significantly lower sales tax rate, may create a competitive disadvantage for Santa Clarita businesses. Currently, the City of Fillmore has a sales tax rate of 7.25 percent and the sales tax rate in the City of Bakersfield is 8.25 percent.
Supporters:
Community Clinic Association of Los Angeles County
SEIU 721 and 2015
St. John’s Community Health
Planned Parenthood Advocacy Project LA County
Health Justice Action Fund
Opponents:
California Contract Cities Association
City of Palmdale
City of Rancho Palos Verdes
Los Angeles County Taxpayers Association
ALTERNATIVE ACTION
Other action as determined by the City Council.
FISCAL IMPACT
There is no fiscal impact as a result of this item.
ATTACHMENTS
Measure ER - Resolution Text