Oct 112018
 

Scott Alvord, a Roseville Councilmember visited the blog and left a comment defending Measure B.

I did some research on the City of Roseville’s tax and revenue numbers, and I am wondering what the City of Roseville was thinking by putting Measure B on the ballot.

Scott Alvord wrote, “Aaron, your 70% sales tax growth claim is very misleading. You selected the absolutely-lowest point of the depression and the first 50% was just to get back to normal.”

Embedded in this post are the year-over-year sales and use tax numbers as reported in the City’s last fourteen budgets.

The claim, that by picking the 2008 point in time, I selected “the absolutely-lowest point of the depression” rings false. From the City’s own numbers, this assertion is wrong.  The low point was 2010, when the City collected just under $26 million.

If, I was “misleading” by trying to make it look as bad as possible, why wouldn’t I have picked 2010?  Then I could have claimed the revenue had grown 106% in just eight years.  Instead, I looked at the most recent ten years, which is a very common practice when analyzing trends.

The next claim from Mr. Alvord is “the first 50% (of revenue growth) was just to get back to normal.”  Again, the City’s numbers show differently.  The low point of 2010 is 22% down from your the high in 2006.

Let’s look at where we are today versus the pre-recession high in 2006.  The revenue estimate for 2018 is 61% higher than the revenue for 2006.  IS 61% growth in 12 years, especially in light of the recession, not enough?

With all due respect to the City Council, it sure looks like Roseville doesn’t have a revenue problem, Roseville has a spending problem!

This series will be continued…

 

  4 Responses to “Follow Up On Measure B: The Numbers Tell the Real Tale Revenue Has Surged, Why Do We Need a Tax Hike???”

  1. Aaron, I appreciate your interest in regards to our city’s financial position, but you’re doing straight math on a complex revenue without fairly showing the whole story. I get it, your goal is share a perspective, but I feel I should at least try to explain a few things. 

    In reality, understanding our financial health is much more complicated than considering a single component such as sales tax revenue. As an example, city revenue has many sources other than sales tax, most all of which were significantly reduced. Any analysis must also include such things as the cumulative dollar value of the revenue reduction, how the reductions were financed during the recession, what reductions in service levels were implemented, (or not implemented), and what expense growth occurred during the same time period. When you have revenue losses a few years in a row, it doesn’t equate with a few better years after. You don’t get that lost revenue back. This very important problem is both a revenue and expense issue and City staff have been very clear and transparent on this point.

    We have been citing increases from things like minimum wage, affordable healthcare, labor, contract maintenance, deferred maintenance, pensions, and labor costs even though the City has reduced per capita staffing from 2007 almost 30%, and reduced pay and benefits to new staff over the same time period. Most, if not all of these expenses are outside the control of the city, such as minimum wage increases that our outsourced vendors pass on to the city.

    It is well known that sales tax and property tax levels have returned to pre-recession levels, however that growth has now slowed (increasing at a decreased rate) but expense growth has not. Furthermore, we are still re-paying expenses that were incurred during the recession and still not funding tens of millions of dollars of deferred maintenance because previous councils had to make sure the budget balanced each year. 

    This growth in expenses, and the need to fund deferred expenses has more than offset the growth in revenue. This is the dilemma we face along with most cities.

    This is not the best forum to discuss this as there are many variables and factors, but I would be happy to sit down with you and discuss the numbers and challenges facing our City. 

  2. Maybe I’m nit picking here, but isn’t it spelled retail? Not Real Tale. As a voter and a citizen, despite the seemingly informed response by Scott Alvord, I always vote against tax increases. Mr Alvord cites that the recent increases don’t alleviate the money that was needed to be borrowed during lean times. But, you could make the case that administrations should have done a better job conserving during those times making the borrowing unnecessary. Here is the unmistakable truth about government: They have revenues, complex as Mr Alvord argues, or as simple as Mr. Park portrays it. Either way, budgets are created based on revenues. According to the chart, revenues for 2018 are about $53M. That means we can expect a budget that aims to spend $53M. If revenues were $63M, the budget would be $63M. The government by it’s function, is always going to spend what you give it. If you give it less, they will get by on less. They will find a way or they will be voted out. Roseville is seeing increasing revenues due to increased population and an improving economy. Put a little in a savings account fellas, because the next recession is likely right around the corner.

  3. The reality is it’s not about sales tax and never was. It’s about public employee pensions, and the money CalPers is demanding from cities all across California. Other cities, not just Roseville, have been inventing reasons like decreased sales tax revenue rather than tell their residents the truth. Roseville has 80 million in unfunded pension obligations. So CalPers is asking the city for increased payments to make up the difference because they lost 100 billion making bad investments during the recession. this started last year, and as I said, has NOTHING to do with sales tax revenue. Our city is lying to us. Yes, they do need the money, as it comes out of the General Fund, but they should be honest with their citizens and just say, look, CalPers is making us pay and there’s nothing we can do about it. Dishonesty is never the answer to a problem.

  4. No matter how you dress it up Mr. Alvord, it still don’t change the fact that Measure B is still a tax increase on the backs of the residents that voted you into office.

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