Santa Rosa voters will decide this fall whether to tax their cellphones, but they won't get to consider changes to a controversial tax measure that funds public safety services in the city.
The City Council voted 5-2 to put a measure on the fall ballot that would “modernize” its tax on utilities and extend it to cover cellphone users.
But the vote came only after a lengthy and emotional debate about whether the city should be expanding one tax before it has tackled needed changes to another.
“What I'm concerned about is we're talking about putting in an IV before stopping the bleeding,” Councilwoman Julie Combs said.
The measure is expected to raise an additional $1.6 million and prevent further erosion in revenues from lawsuits that could block the city from collecting the tax and society's technological shift from landlines, which are currently taxed, to cellphones, which are not.
It would lower the 5 percent rate on all utilities to 4.25 percent, but raise more money by generating $2.7 million in new revenue from cellphones. Several City Council members were convinced that the utility tax could disappear soon.
“The (utility users tax) is an immediate threat to our financial stability,” Mayor Scott Bartley said.
But critics of the move felt it was more important for voters to have the chance to fix what they say are problems with Measure O, the 2004 quarter-cent sales tax measure to enhance public safety and gang-prevention services. The tax is controversial because it has a baseline funding level that adjusts upward annually by the consumer price index.
Councilmembers Gary Wysocky and Combs voted against expanding the utility tax until the public safety tax measure is changed.
Combs said she was extremely frustrated to hear the explanation that there wasn't enough time to educate the public to ensure the ballot measure succeeded. She said she heard the same explanation two years ago.