Atherton opts for the familiar in quest for another parcel tax term Atherton opts for the familiar in quest for another parcel tax term (February 16, 2005)

By Andrea Gemmet

Almanac Staff Writer

It's deja vu all over again. After the November defeat of a parcel tax renewal measure, Atherton officials, in a last-ditch effort to shore up the town's finances, are going to put the exact same parcel-tax measure before voters in June.

Well, almost exactly. The one wrinkle in the measure, which brings in over $1.8 million annually and costs the average Atherton homeowner $750 a year, is that the council plans to ask for either a five- or seven-year renewal term, instead of the four-year term that has been the norm since the first Atherton parcel tax was instituted more than 20 years ago.

The consensus among the four City Council members at the February 7 study session was to stick with the familiar and emphasize to voters that this is the same old parcel tax they've come to know. Councilman Charles Marsala was absent.

A proposal to include a parcel tax waiver for senior citizens was dropped, because too many Atherton residents could opt out of the paying the parcel tax, resulting in a very unstable income stream for the town, said Councilwoman Kathy McKeithen.

Switching to a slightly longer term will give town officials and staff more time between parcel tax campaigns to focus on actually running the town, and by changing to an odd number of years, the parcel tax will be up for renewal in an off-year election, said Councilman Alan Carlson.

"It's a benefit because the attention of the residents will be solely focused on the parcel tax, rather than a presidential or gubernatorial race," Mr. Carlson said.

The final decision on the term should come this week, when the council is set to decide on ballot language for the special June election at its regular meeting on Wednesday, February 16.

Atherton faces a serious deficit in the coming years, despite trimming close to $1.3 million from its budget since February 2003. The shortfall is blamed on the increasing cost of pension benefits for police officers and town staff and state takeaways, according to staff. Atherton's miniscule sales-tax revenues, the result of having no commercially zoned property, has made the parcel tax an important source of income for the town.

"Life is full of surprises. Who'd have thought we'd be beset by retirement benefits?" said Mayor Bill Conwell.

Currently, the parcel tax is divided, with about $1 million dedicated annually to capital improvement projects, such as road repairs and drainage improvements, and the rest for general fund expenditures. With costs rising while parcel tax revenues stay the same, Atherton would still face a budget crunch, with funds for capital improvements dropping from just over $1 million in the current fiscal year to $710,000 by 2010, according to Finance Director John Johns.

To make up the difference, Atherton could change the rates of its road impact fees and raise an estimated additional $600,000 a year for road repairs as part of the capital improvement fund to make up for the loss of parcel tax revenues, said Mr. Johns.

Road impact fees are charged to developers to reimburse the town for damage to the roads caused by heavy construction vehicles. The City Council recently got the results from a study documenting the additional wear and tear caused by trucks loaded with dirt from basement-excavation projects.

Town staff said they plan to bring a proposal for the road-impact fees before the City Council next month.
INFORMATION

The Atherton City Council meets at 7 p.m. Wednesday, February 16, in the Town Council Chambers, 94 Ashfield Road.

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