Report: Tax loss has 'significant impact' on capital projects

Atherton city manager's report is part of Wednesday council meeting

Losing the funding Atherton received from its annual parcel tax will have a "significant impact" on the town’s ability to complete capital projects over the next three to four years, City Manager George Rodericks says in a report prepared for the Nov. 15 City Council meeting.

Mr. Rodericks' report lays out some of the town's options after voters on Nov. 7 failed to renew the town's $1.8 million annual parcel tax, which ends next June.

The report says 80 percent of this year's parcel tax revenues went to capital improvements and the rest to a school resource officer and a traffic officer.

The civic center is the "most important capital project" on the town's horizon, the report says. Except for a council-mandated reserve fund of 35 percent of its operating budget, all current and projected surplus funds through the 2020-21 fiscal year are dedicated to the civic center, the report says.

The town's general fund "may be able to absorb the $372,000 loss for police services (but) it cannot absorb the loss of $1,488,000 per year for capital projects without jeopardizing the integrity and success of the Civic Center," the report says.

A possible solution would be to put off parts of the project. The council designated a new council chamber and landscaping as possible "deduct alternatives " items in the approved plans that could be postponed if bids are higher than anticipated. Those items could reduce the cost by $1.2 million.

Even if the bids aren't high and the two items are removed from the project, it will make up for less than a year of the parcel tax, the report says.

Mr. Rodericks' report says that once the civic center is completed, the town should have approximately $2 million a year to spend on capital improvement projects. However, he says, that would mean paying for capital improvements with money the town had been using to pay down long-term liabilities for things such as pensions and workers compensation.

The meeting starts at 7 p.m. in the town's council chambers at 94 Ashfield Road.

Also on the agenda:

● With the planned retirement of Steven Tyler, the town's public works superintendent, the council is being asked to approve ending the agreement with Interwest Consulting Group to supply a town engineer. A combination public works director/city engineer would be hired. The staff report by Deputy City Manager Theresa Della Santa also suggests changing the city arborist job into park manager/city arborist and changing an associate engineer to a senior engineer/maintenance manager. After factoring in the savings from ending the contract and the differences in salaries and benefits, the changes would save the town nearly $90,000 a year.

● Denial of a claim made against the town over an early August incident in which a branch on a tree at Menlo College fell and injured several people attending a company party. The incident did not happen on town property, the report recommending denial of the claim says.

●A decision on whether to allow a donation that would transform one of the Holbrook-Palmer Park tennis courts to a clay court. Clay tennis courts have higher maintenance costs and use a lot of water, but the report says the town could charge more for using the courts to make up for the costs.

More information about effect of the loss of the parcel tax on the town's budget will be presented to the council at its Dec. 6 study meeting.


1 person likes this
Posted by lorry l
a resident of Atherton: West Atherton
on Nov 13, 2017 at 4:34 pm

So Atherton's city manager says failure of the parcel tax will slow down maintenance. Another case of a bellowing politician inadequte in ability to work around the bonus city income. He refuses to acknowledge the millions of dollars that have come in above budget from home sales during the last generation.

Instead, much like the Washington cesspool, Atherton politicos want the gravy train from nonthinking billionaires to continue forever. This time around more Athertonians woke up to the masquerade and voted it down. The parcel tax merely is a device to circumvent Prop. 13.

8 people like this
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Nov 13, 2017 at 5:18 pm

Peter Carpenter is a registered user.

The voters expect the Town to continue to fund its current operations first and foremost and then to apply the remaining available funds to the Town Center.

5 people like this
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Nov 13, 2017 at 6:57 pm

Peter Carpenter is a registered user.

Useful history:

Measure L - 2012 To build a Town Center with gifts (other people’s money) - 73%
Measure X - 2013 Parcel tax - 73%%
Measure A - 2017 To Build a Town Center with gifts plus tax revenues - 61%
Measure A - 2017 To Authorize a new parcel tax - 50%

2 people like this
Posted by Airbnb tax Revenue
a resident of Atherton: West Atherton
on Nov 14, 2017 at 7:32 am

How about Atherton joins many local towns to allow Airbnb and collect the rich stream of tax revenue it provides the town? Basically free money for no work while providing a valuable service to the community and visitors to our community.

3 people like this
Posted by Better idea
a resident of Atherton: West Atherton
on Nov 14, 2017 at 8:13 am

I've got a better idea. Instead of perpetually taxing the long-time residents of this town, let's tax the town's real business activity: real estate development.

Problem is, the council member, Elizabeth Lewis, who is leading the town center efforts, and the tax efforts, is beholden to both of Atherton's special interest groups: the police union, and the residential real estate developers.

So is her colleague Cary Wiest.

This has led to a double whammy against Atherton's taxpayers. High spending due to out-of-control police salaries and benefits, coupled with a hands-off attitude on regulating and taxing real estate development.

And so no one has any doubt, I'm talking about taxing the developers who build homes for resale. Not residents selling their home, which was an idea floated to try to protect the developers (and the police) a few years ago.

While we're at it, let's look at outsourcing the police just like Woodside and Portola Valley so our taxes go down. Then we wouldn't need to worry about how to get money to fix our roads and drainage. The property values there are doing just fine, and the residents are not becoming victims of crime and plunder.

The reason Atherton has kept its police department in house despite every logical reason in the world not to is directly tied to political favoritism between the union and council members such as Elizabeth Lewis, Cary Wiest, and their boss, Didi Fisher (the true "boss" behind the $55M town center). It has nothing to do with the actual facts of the situation.

3 people like this
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Nov 14, 2017 at 8:36 am

Peter Carpenter is a registered user.

The Atherton Audit and Finance Committee meets today at 2 PM in the Council Chambers and will receive the following report:

5. Review presentation of Atherton Property Taxes for Fiscal Year 2017/18 by Paula Cone of HDL Companies.

As always the public may comment on any agenda item.

Interestingly the Committee's agenda does not include any discussion of the impact of the failed parcel tax and the Committee's next meeting is jan. 9, 2018. Evidently the fiscal impact of the failed parcel tax is not a high priority issue for this Committee.

2 people like this
Posted by Apple
a resident of Atherton: other
on Nov 14, 2017 at 11:22 am

There's a majority that want the town center rebuilt with town funds (Measure A) and also are willing to keep the parcel tax for additional capital projects and police employees (Measure F). However, both lack supermajority support.

What should the council do? Find a compromise that is more weighted to what the majority wants. There are a number of ways to accomplish this.

1) Delay spending on some capital projects
2) Borrow through Certificates of Participation or bonds
3) Some combination of the above

Any borrowing will be paid back via future tax revenues.

Sorry, but further commenting on this topic has been closed.

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