HomeMy WebLinkAbout7.1 EmergMedSvsExciseTxCITV_CLERK
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AGENDA STATEMENT
CITY COUNCIL MEETING DATE FEBRUARY 18,1997
SUBJECT: Consideration of Special Excise Tax for Emergency
Medical Services
(Report prepared by Elizabeth H. Silver, City Attorney and
Q Paul Rankin, Assistant City Manager)
EXHIBITS ATTACHED: Memorandum from City Attorney re: Use of Public Funds
to Support Ballot Measures
RECOMMENDATION. See Below.
FINANCIAL STATEMENT: If enacted, the proposed EMS tax would generate
approximately $72,610 in FY 1997-98, which is
approximately $45,280 more than was generated in FY
1996-97 by the EMS Supplemental Assessment. The cost
of the election is estimated to be $10,000 to $12,000.
DESCRIPTION: At the February 4, 1997 Council meeting, the Council considered a report
on the implementation of Proposition 218. One of the recommendations which the Council
approved was to place a special tax on the June 1997 ballot for emergency medical services.
The Council must take several actions prior to March 6 to place a measure on the ballot for the
June election. This report asks the Council to provide direction to staff so that staff can return at
the March 4, 1997 Council meeting for Council action.
BACKGROUND
Emergency Medical Services available to Dublin residents are provided by the Dougherty
Regional Fire Authority, a private ambulance company (AMR), and three trauma centers.
Emergency medical services consist of advanced life support, paramedic services, medical
services rendered at the trauma centers, dispatch services and related training. Part of the cost of
these services is subsidized by Alameda County through the existing Emergency Medical
Services District which levies an assessment of $21.14 for FY 1996-97 on all residential units in
the County. Individual cities levy supplemental assessments to provide local components of the
EMS system. DRFA levied a supplemental assessment of $3.28 per benefit unit for FY 1996-97.
Alameda County proposes to fund Emergency Medical Services for FY 1997-98 and in the future
through a special tax, rather than through an assessment. The proposed County special tax would
be in the amount of $21.14 per residential unit. The County calculates the amount for
apartments, condominiums ,and townhouses as individual units provided that there are six or
more units on the parcel. Nonresidential parcels are charged anywhere from two to seven times
the residential rate. For example, a department store is charged five times the residential rate, or
$105.70.
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The City will be providing fire and emergency medical services through contract with Alameda
County commencing July 1, 1997. The contract with Alameda County will fully implement a .
local paramedic program which will increase the level of service available to residents by
providing a paramedic on each Engine Company located in the City. This will effectively reduce
the paramedic response time to an average of 5 minutes for calls within the City of Dublin.
The proposed tax would replace the "supplemental assessment" and would be used to fund the
local paramedic program. It would be structured to reflect the use of emergency services in the
same manner that the existing County assessment reflects the use of such services by different
types of properties. The current procedure involves the calculation of a "benefit unit" or "RU."
which is then applied in different increments to different parcels depending on use. For example,
the current assessment assigns "1 RU." to a single family residence. Nonresidential uses pay
multiples of 1 RU., depending on the type of use (e.g., a department store pays 5 RU.s, a
warehouse pays 2 RU.s). Unimproved property pays no assessment.
ANALYSIS OF LOCAL TAX BY TYPE OF LAND USE
At the City Council meeting on February 4, 1997, Staff addressed the implementation of
Proposition 218 by presenting a package of recommendations related to fee, assessments, and
taxes. As part of that report it was proposed to seek a $10 per residential unit EMS Special Tax.
The increase which would be experienced by a homeowner was projected to be more than off-set
by a decrease in the NPDES - Storm Water fee. Overall, the net decrease to a single family
household was projected to be $0.64 or 2.1% of the combined NPDES and EMS amounts .
collected on the property tax bill.
Subsequent to the February 4, 1997 meeting Staffhas had the opportunity to evaluate the impacts
on properties based upon whether they are Single Family residences or Multi-Family Residences.
The past practice with both the County and DRF A EMS assessments, was to levy the same
amount per household regardless of the type of housing. However, the NPDES fee is levied
differently depending on the land use type reported by the County Assessor. The following
shows the formulas used to calculate the NPDES Fees:
Townhouses (199 Units)
: Levied the same as a Single Family Household. ($14.72)
Condominiums (1,835 Units) : Levied at 60% of a Single Family Household ($8.84)
(Includes Condominiums under common ownership and currently rented as apartments)
Apartments ( 616 Units)
: Levied as commercial [Lot Size (sf) /4,840 (sf) * $14.72]
The use of a different methodology for NPDES fees collected from Multi-Family properties
affects the ability to achieve a net savings when combining a reduced NPDES fee and an increase
in the EMS tax. The townhouse category is not affected as these units are charged the same as a
single family household on both fees. There would continue to be an estimated savings of2.1 %.
If the City Council were to structure the EMS Tax so that all properties were projected to receive
a net decrease in the combined NPDES fees and EMS tax, Multi-Family properties would need
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to be taxed for EMS at a rate less than $10 per unit. Multi-Family would include apartments and
condominium projects with 6 or more units. The documents utilized for the Eastern Dublin
General Plan as well as the Public Facility Fee projected average residential occupancies. It was
estimated that a factor of3.2 should be used on Single Family and a factor of2.0 on Multi-
family. Therefore, the population for each multi-family housing unit is projected on average to
be 60% ofa single family unit.(2.0 compared to 3.2) If this ratio was maintained for the local
EMS Tax, a new rate of$6.00 would be appropriate for multi-family units. The following
outlines the differences between the $10.00 per residential unit proposed February 4, 1997 and
applying a rate of$6.00 on Multi-family units.
AmtOfEMS Tax
Per Benefit Unit
$ 10.00 all units
$ 10.00 Single Family
$ 6.00 Multi-Family
Total Estimated
Annual Revenue To
City (Net of Co.
Collection Fee)
$ 83,330
$ 72,610
Given the changed outcome based upon the additional information, Staff would recommend that
the rate for Multi-Family units be established at $6.00. This will result in a difference in the
methodology used by the City as compared to what will be proposed under the County Tax.
. Under the revised proposal one B.U. would have a value of$10, with the result that each single
family residential unit would pay $10 per year (Townhouses would continue to be designated
equivalent to a single family unit). Each Multi-family (Apartments and Condominiums in
projects with 6 or more units) would be taxed 60% times the base amount of$1O.00 = $6.00.
The number of Benefit Units for all other land use designations would remain the same as is
currently used by the County. It was noted in the previous Staff Report that agencies which had
paramedic trained fire personnel were levying closer to $10 than the $3.28 levied by DRF A.
I
i CONSIDERATION OF ESCALATOR FOR FUTURE COLLECTIONS
The County's proposed tax ordinance was not finalized as of the writing of this staff report. It is
staffs understanding, however, that the County tax is proposed to include a formula which would
allow the tax to increase in future years. Among the options under discussion are an increase
based on changes in the Consumer Price Index or an increase based on the increase in assessed
valuation capped by the Proposition 13 annual cap of 2%. Some agencies which are
considering measures with escalators are also proposing to place a maximum cap which cannot
be exceeded without voter approval. (Fremont is considering an initial $10.88 tax which can
adjust by CPI, and will have a maximum cap of$15.00) In order to simplify Dublin's EMS tax,
staff does not recommend inclusion of an inflator. The City tax would, therefore, remain the
same in future years and the only opportunity for increased revenues would come from increases
in the number of parcels.
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EMS TAX
The proposed tax would be a tax on the availability and use of emergency medical services. .
Such a tax is termed an "excise" tax. The City is authorized to levy such a tax by Government
Code section 37100.5. The proposed tax cannot be a "property"/parcel tax because all "property
taxes" must be ad valorem (Cal.Const., Art. 13, sec. 1) but Proposition 13 prohibits ad valorem
taxes even if enacted as special taxes with a two-thirds vote (Cal.Const., Art. 13A, sec. 4).
To be valid as an excise tax, the tax must be on the use of property, rather than on the ownership
of property; must not be charged to unimproved property [because no people are occupying such
property who may need EMS services]; should not be charged to improved but vacant properties
[again, there are no persons using the property]; should be a personal debt and not a lien on the
property; and must be proportionate to the use of the city services. (City of Oakland v. Digre.
(1988) 252 Cal.Rptr. 99.)
Because the proceeds of the tax would be designated for a special purpose --provision of
emergency medical services including first-in response by fire personnel to provide both basic
and advanced life support -- the proposed tax would be a special tax. A special tax requires
approval by two-thirds of the voters voting at the election. (Government Code sec. 50075 and
sec. 53722 [proposition 62]; Article XHIC, sec. 2 [Proposition 218].)
PROCEDURES FOR ENACTMENT OF EMS TAX
The Council must first adopt an ordinance establishing the tax by a majority vote of the Council.
(Government Code sec. 53724(a)). In order to become effective the ordinance must be approved .
by two-thirds vote of the voters voting at the election. (Government Code sec. 53722.)
Government Code section 50077 requires that an ordinance imposing a special tax be enacted
following notice and public hearing. The ordinance must include the type of tax, rate of tax,
method of collection, the date upon which the election shall be held to approve the tax and the
purpose or service for which the tax is sought. (Gov. Code section 53724.)
Any challenge to an ordinance approved pursuant to the provisions of Government Code section
50077 may be challenged by a validation action which must be filed within 60 days of the
effective date of the ordinance, which would be ten days following the date the results are
certified. (Gov. Code section 50077.5.)
ELECTION ISSUES
In addition to approving the proposed ordinance to impose the tax, the Council must approve the
form of the "ballot question." The Elections Code limits the ballot question to 75 words or less.
Ballot arguments are provided by law. The Council, however, may determine whether to allow
rebuttal arguments.
If more than one argument is submitted in support of the proposed tax, the City Clerk must select
which ballot argument to publish. Elections Code section 9287 sets forth the priority that the
Clerk must follow: a) The legislative body or member or members of the legislative body .
authorized by that body; b) the individual voter or bona fide association of cities who are the
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sponsors of the measure [not applicable in this situation]; c) bona fide association of citizens; and
d) individual voters who are eligible to vote. If the Council designates one or more of its
members to write an argument in support of the measure, it may also wish to provide in its
motion that such members may agree to allow other groups or persons who are eligible to author
a ballot argument to sign the argument along with the Councilmember(s) to reflect more
widespread support for the measure.
Finally, although the Council can place the measure before the voters, can endorse it and can
authorize one or more members of the Council to write the ballot argument in favor of the
measure, the City cannot expend public funds to promote the passage of the measure. The
expenditure of public funds in support of a ballot measure has been held to be an inappropriate
use of public monies and to violate the Fair Political Practices Act. A memorandum discussing
the law relating to the use of public funds to support ballot measures is attached (Exhibit 1.)
RECOMMENDATIONS
Staff requests the Council provide direction regarding the following questions. Staff will then
return at the March 4 meeting with the resolutions and ordinance necessary to place the proposed
tax before the voters at the June election. These will include the ordinance imposing the tax and
the resolutions to call the election (including the ballot question), consolidate it with the general
election in June and have the County conduct the election.
1. Shall rebuttal arguments be allowed?
2.
Shall the Council designate one or more members to write the ballot argument in
favor of the proposed tax?
3. Shall the Council allow other voters who are authorized to write the ballot
argument to join in the Council's ballot argument, at the discretion of the Council
person( s) writing it?
4. Shall the special tax increase annually by an inflator, or shall the special tax be
flat?
(a) If the City Council wishes to include an inflator, it will be necessary to select
the formula for the increase (Le. the 2% annual increase in assessed valuation
allowed under Prop. 13, or by the CPI)?
(b) If an inflator is used shall there be a maximum cap on the amount the tax can
escalate to without further approval by the voters?
5. Shall Staffprepare the Ordinance showing a $10.00 Benefit Unit amount to be
levied on Single Family units and a $6.00 amount on multi-family units.
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MICHAEL F. JlODIUQUEZ
XATHUiSN rAUBTON. ,AICP
WENDY A. ROBERTS
DAVID W. SKINNER.
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WAYNE 1<. SNODGRASS
ARNE s. SANDBERG
MEYERS, NAVE. RIBACK, 81L VER & WILSON
^ PROFESSIONAL LAW COFlPOMTION
$ANTA ROSA OF"'CI1
GATEWAY PLAZA
777 pAVIS STREET, SUIT!: 300
SAN LEANDRO. CALIFORNIA 94577
TELEPHONE: (510) 351.4300
FACSIMilE: (510) 351.4481
555 FIFTH STREET. SUITE 230
I:ANTA 1l0l:A. CA 01401
TELEPHONE: 17071 545-8009
FACSIMILE' 1'0'1 545-661'
QI'Q)tJNSllL
ANDIUiA I. SAL'IZMAN
MEMORANDUM
TO:
Mayor and Councilmembers
City of Dublin
DATE: Febmary 14,1997
FROM:
Elizabeth H. Silver
City Attorney
RE:
Use 9f Public Funds to Support Ballot Measures
. The purpose of this memorandum is to provide a summary of California law
regarding the use of public funds to support ballot measures.
A. Public Entities Are Only Allowed To Spend Public Funds Impartially
Providing The Public. With Balanced Information.
Public agencies are pennitted to expend public funds to provide the public with
relevant information about. an upcoming ballot. measure, so long as the information
provided is full and impartial and does not seek (either explicitly or implicitly) to
influence the voters' decision on the measure. Stanson v. Mott (1976) 17 Cal.3d 206,
221, 130 CaLRptr. 697. However, "a public agency may not expend public funds to
promote a partisan position in an election campaign," and "may not 'take sides' in election
contests Or bestow an unfair advantagc on one of scvcral competing factions." St-af1.son, 17
CaL3d at 209.210,217.1
Pcrmissible "informational" activities, on which public funds may be spent, arc
those which seek to provide the voters "With accurate, fair, and unbiased facts about the
issues involved in the ballot measure to enable them to make an informed judgment. In
.
1 Stansan y. Matt held that expenditures of public funds for partisan campaign purposes may
be ~.tIlowed if the)' are dearly and explicitly authori:r.ed by a st~tutc. No such statutory authorization
exists for the City.
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Mayor and Councilmembers
E.l1Zabeth Ii. Sllver. City Attorney
tJ8e of Puhlic Punds-to Support Ballot Me~utlilS
February 14, 1997
2
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contra-st, illegal "campaign" activities seek (either eA.plicitly Or implicitly) to influence the
voters' decision On the measure.
While no cxhau:;tivc li:;ting of pcnni::;:;iblc and impcnni:;~iblc activitic:5 i:; pO:5:5iblc,
the Stanson opinion provides some guiddines. In that case, the Supreme Court hdd that
it would be an illegal expenditure of public funds for a public agency -- the California
Depanmcnt of Parks and Rc:ocation -- to ~pcnd more than $5,000 in public funds to
promote the passage of a bond act submitted to the voters by (1) mailing materials written
and printed by the public agency which "presented promotional material in favor of' the
bond act; (2) mailin?; materials written by private proponentl:i of the act; (3) spending
public funds on travel expenses and speaking engagements to promote the bond act; and
(4) authorizing ~ three~p~rson st.aff, at. puhlic t':xpr:nst':, to work on promoting the act.. 17
Cal.3d at 211.
As the Supreme Court explained, it is proper for a public entity to expend public
funds in order to educate and giVe a "falr presentation of the facts" in response to a .
citi~en's request for information. Similarly, a public entity may properly authorize an
employee to present the public entity's view of a ballot proposal at a meeting of a public
or plivate organization, when requested by such organization. 17 Ca1.3d at 221.
Importantly, however, the mere fact that the "information" does not specifically
urge any particular vote on the issue does JlQ1 guarantee that no illegal use of publiC funds
is involved. Even if lL lad<s any exhortation to vote in favor of or against the ballot
measure, "information" prOvided at public expense must be balanced and objective. Some
of the factors which will determine whether a pUblic entity's activities are permissible are
lhe "style" and "tenor" of the public entitts publication or communication (Le., is it
genuinely even-handed and non-argumentative?) and its "timing" (Le. an act done very
shortly before the election is more likely to be seen as illegal campaign activity).
Correspondingly, the disseminat.ion, At public expense, of campaign literature
prepared by privat.e proponents or opponents of a ballot measure would be illegal, as
would the use of public funds to purchase such items as bumper stickers, posters,
advertising floats, Or media advertising. 17 Cal.3d at 221.
League of Women Voters of California v. CCJCC (1988) 203 CalApp.3d 529,560,
250 CaLRptr. 161, relied on Stsm:<lrm to hold that a county board of supervisors' . .
endorsement of a proposed ballot initiative, given In the course of a regular pllhIic
meeting) did not entail any improper expendiLUre of public funds, so long as the
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DATE:
PAGE:
Mayor and COllndlmem bers
:eUzabeth Ii. Silver, City Attorney
Use of Public Funds to Support Ballot Measures
F~brumy 14, 1997
3
endorsement was a simple announcement of position and involved no genuine effort to
persuade the electorate_
D. Campaigning AO:ivitics May Trigger R~orting Requirements
As stated above, absent explicit statutory authorization, any o:penditure of public
funds which bnplicdly or c.xpre:5~ly promote~ a ballot mcaosure b illegal. Additionally,
however, a. public entity which engages in such expenditures may be in violation of the .
California Political Reform Act, Government Code 81000 et seq., and may be fined by the
Fair PolitIcal PracticC::/5 CorruIlb~iuI\ (tlFPPC") al) a rt:l)u1t.
Under Gov.Code s8203!. an "independent expenditure" includes any expenditure
by any person or entity "in connection with a corrununIcation whIch expressly advocates
the election or defeat of a clearly identified candidate or the qualification, passage or
defeat of a clearly identified measure, or taken ;lS a whole and in conte.xt, llmnnDigllOJ]sIy
urges a panlcular result In an electIon but which Is nO( made to or at me behest of the
affected candidate or committee." Id. (emphasis added).
Any person, or combInatlon of persons, who directly or IndIrectly makes
"independent expenditures" totaling $1,000 or more in a calendar year constitutes a
"committee." Gov.Code ~82013(b). "Committees" within the terms of Gov.Code
~82013(b) are required to file campaign statements with the FPPC semiannUally if they
have made "independent expenditures" Within the last six months, Gov.Code ~84200.
In conclusion, whether a particular activity will run afoul of the Supreme Court's
decision in Stansoll and the Political Refonn Act must be dedded on a case-by-case basis.
Very truly yours,
MEYERS, NAVE, RIBACK, SILVER & WILSON
~~~
~lizabeth H. Silver
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