Desperate to find a way fill the city’s ongoing $3 million
budget deficit and avoid cuts to city services, the Hollister City
Council has commissioned a company to poll locals’ willingness to
pass a new tax.
Hollister – Desperate to find a way fill the city’s ongoing $3 million budget deficit and avoid cuts to city services, the Hollister City Council has commissioned a company to poll locals’ willingness to pass a new tax.
During the council’s Jan. 17 meeting, council members agreed to pay California firm Fairbank, Maslin, Maullin & Associates, Inc. $26,500 to survey registered voters in Hollister and determine their willingness to approve a new tax, and if so, how large of a tax would be acceptable. The survey will also find out what city services are most important to residents and so they know where to cut should voters be unwilling to pass a new tax.
Property, sales and hotel taxes are among the possible options to put before voters, City Manager Quilter has said.
“(The survey is) going to give us an idea of what people will go for and not go for,” Mayor Robert Scattini said. “Just to feel people out.”
Suffering under a sewer moratorium – prohibiting new construction requiring sewer hook-ups – imposed by the state in 2002 after 15 million gallons of treated sewage spilled into the San Benito River, Hollister’s economic development has been brought to a near standstill. Also, each year the city spends $3 million more than it brings in – a built-in deficit that, if left unchecked, will drain Hollister’s $7 million general fund reserve within a couple of years.
Councilman Brad Pike compared Hollister’s financial situation to a brick being pushed toward the edge of a wall.
“We’re getting closer to the edge,” he said. “And once it goes over, you can’t catch it. That’s what I’m afraid of.”
While Quilter says the city will have a new sewage treatment plant by late 2007 – thus lifting the moratorium – and city officials are working on a strategy to market Hollister to businesses seeking new locations, there are few short-term options, aside from a tax increase, to boost the city’s bottom line and stave off cuts to city services.
“We have a significant structural deficit which must be addressed in some fashion,” Quilter wrote in an e-mail.
Quilter said that if the city does not find some way to increase Hollister’s revenue, the city will be hard-pressed to maintain city services at their current levels. He said he did not yet know which services are at risk of being reduced.
“Those are some of the issues that need to addressed,” he wrote. “We believe that our polling will assist in these decisions.”
Pike said if any tax will fly with Hollister voters he thinks it will be the sales tax. At 7.25 percent, Hollister’s sales tax is among the lowest in the state. Since so many locals shop in Gilroy, with a sales tax 1 percent higher than Hollister’s, they are used to paying the higher tax rate, he said.
“They still pay the higher tax in other communities,” he said. “It’s not something they’ve never been exposed to.”
Despite a financial landscape that he calls “pretty bleak,” Scattini said he is still skeptical that voters would approve a new tax.
“I think it would be very difficult to pass a tax,” he said. “I think people are just taxed out.”
Pike said he wasn’t sure how receptive Hollister voters would be to increasing taxes, which he said is necessary to get the city through the next few years.
“It’s the public helping itself,” he said. “The community really is put in a corner. Nobody wants to pay more taxes, but to go in the direction the community wants to go we have to be self- sustaining.”
Quilter said he is currently working with Fairbank, Maslin, Maullin & Associates, Inc. to determine when polling will begin. The company will survey 400 registered voters who live in Hollister.
Luke Roney covers local government and the environment for the Free Lance. Reach him at 831-637-5566 ext. 335 or at [email protected].
