City Council
Report
City Council Meeting: July 23, 2024
Agenda Item: 14.A
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To: Mayor and City Council
From: Oscar Santiago, Director, Finance Department, Revenue Subject: Adoption of a Resolution to place a Parking Facility Tax revenue measure on the November 2024 Ballot
Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;
2. Adopt a Resolution to place a measure on the November 5, 2024, General Municipal Election Ballot to increase the City’s Parking Facility Tax rate by 8% and exempt City-owned lots and structures from the tax increase (Attachment A), which would be accompanied by an advisory measure that would allow voters to express their preference that at least half of the additional revenue generated by the Parking Facility Tax Measure should be allocated to address public safety and homelessness; and
3. Identify Council Members, if any, who wish to prepare arguments for or against the Parking Facility Tax measure or the accompanying advisory measure.
Summary
On July 9, 2024, Council directed staff to bring back the Parking Facility Tax proposal, discussed at the Budget Adoption meeting, with an advisory measure indicating that half of the additional revenue generated by the measure tax should be allocated to address public safety and homelessness. This measure was first considered by Council at its June 25, 2024 meeting. As stated in the June 25, 2024 staff report on proposed ballot measures, this proposed ballot measure has been vetted twice within the community through polling. The proposed ballot measure language reflects the direction of Council, as well as the feedback 2 of 5
received during polling to focus on public safety. All ballot measure proposals must be submitted to Los Angeles County by August 9, 2024 for the November 5, 2024 election.
Discussion
The City continues to navigate various challenges, ranging from economic uncertainty resulting from inflation and high interest rates, increased costs, the need to address deferred infrastructure and equipment maintenance, and contingent liabilities. This has hindered the City’s ability to expand services to levels that meet the community’s needs and expectations. On June 25, 2024, as part of budget adoption, Council directed staff to explore what is needed to further address public safety and homelessness in Santa Monica, with the understanding that without additional resources, Council would have to consider tradeoffs in the General Fund to reallocate funding within City programs and services. It is in this environment, that on July 9, 2024, Council directed staff to bring back the Parking Facility Tax proposal, discussed at the Budget Adoption meeting, with an advisory measure indicating that half of the additional revenue generated by the tax measure should be allocated to address public safety and homelessness.
Proposed Ballot Language
Staff estimates that an 8% tax increase would generate approximately $6.7 million in additional annual General Fund revenues. The resolution to place the measure on the November 2024 general election ballot is included in the staff report. If Council decides to move forward with placing the item on the ballot, the recommended ballot language is as follows:
Parking Facility Tax Measure
To maintain essential city services, including enhancing public safety, creating safe routes to school to protect children, and lowering the risk of fatal traffic accidents, shall the measure increasing the City of Santa Monica Parking Facility Tax by 8% for users including visitors and tourists, causing no additional cost in City-owned lots and structures (including downtown and 3 of 5
the beach) because of a partial City exemption, generating approximately $6,700,000 annually until ended by voters, be adopted?
The Council has also proposed an advisory measure to guide spending of additional resources if the measure passes. The text is below and included in Attachment A:
Parking Facility Tax Advisory Measure
ADVISORY VOTE ONLY: If Measure __ is enacted, should at least half of the additional revenue raised be used to protect public safety in Santa Monica, including attracting and retaining well-trained police officers and firefighters, improving crime and homelessness prevention services, and increasing police patrols and enhancing emergency medical response in neighborhoods and public areas, including downtown, the pier, and the beach?
If the Advisory Measure associated with the Parking Facility Tax Measure passes, it provides an indication of general voter opinion on the proposed uses outlined in the Advisory Measure. If the Advisory Measure passes and the Parking Facility Tax Measure does not, there will be no change to existing policy.
The proposed resolution (Attachment A) includes the text of the Parking Facility Tax Measure (Exhibit 1) and the text of the Parking Facility Tax Advisory Measure (Exhibit 2) and authorizes designated City Council members to submit arguments and rebuttals concerning each measure. Council may designate one to five members to submit arguments and rebuttals for each measure. Finally, the resolution directs the City Clerk to transmit a copy of the measures to the City Attorney and directs the City Attorney to prepare an impartial analysis of the effects of each measure on the existing law as well as on the operation of each measure.
Arguments and rebuttals shall be submitted in accordance with State Elections Code Sections 9280-9287 and Santa Monica Municipal Code Section 11.04.125. 4 of 5
The Elections Official will set the deadline for submitting arguments as 14 days from the date the election is called on the measure and the deadline for submitting rebuttals to arguments as 10 days after the deadline for submitting arguments on the measure, or the date fixed by the City Clerk, whichever date is later.
If the Parking Facility Tax Measure is approved, the increase would go into effect on January 1, 2025.
Past Council Actions
Meeting Date Description
12/19/23
(Attachment B)
Evaluate feasibility of Parking Facility Tax Increase Tax Measure on the November 2024 ballot
6/25/24
(Attachment C)
FY 2024-25 Operating and Capital Improvement Program
Budget Adoption
Environmental Review
The parking facility tax and Business License Tax modernization are exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. The proposal is covered by the common sense exemption which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” If enacted, the proposed tax measures would create revenue and promote equity for the City.
Therefore, it can be seen with certainty that actions would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of recommended action. Staff will return to Council if specific budget actions are required in the future as result of approved ballot measures. If voters approve the Parking Facilities Tax measure, staff estimates an increase of approximately $6.7 million annual in the General Fund.
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Prepared By: Oscar Santiago, Director
Approved Forwarded to Council
Attachments:
A. Attachment A. Parking Facility Tax - Ballot Resolution w Advisory Measure B. Attachment B. Feasibility of Tax Increase Measure
C. Attachment C. FY 2024-25 Operating and CIP Budget Adoption D. July 9th Staff Report
E. PowerPoint Presentation