PLEASANT HILL -- The battle over raising the utility tax in Pleasant Hill pits residents who believe the city needs more money for police and road maintenance against those who say the council should instead cut spending.

The debate encompasses themes playing out in elections across the country in the fall, including the economy, taxes, pension reform and government spending.

Kevin Gregory started a website, www.nopleasanthilltax.weebly.com, in July to recruit people interested in defeating Measure T, which would raise the utility tax from 1 percent to 1.5 percent and apply it to landline and cell phone service, cable, electricity, gas, water and sewer bills.

With the recession dragging on, the timing couldn't be worse, Gregory said.

"For the city to come and in the middle of this ask to raise taxes people pay when they're trying to pay their mortgage, stay afloat and keep a job is the wrong thing to do," he said.

"It seems to me that the city hasn't gone far enough to see how they can cut their own expenses before asking everyone else to pony up."

The Pleasant Hill Taxpayers Association and Pleasant Hill Citizens for Responsible Growth also oppose the tax increase.

Organizers of the "Yes on Measure T" campaign say opponents are missing the point. They argue that the utility tax would provide a steady source of income that the state can't take away. The money could be used to pay for police, more library hours, crime-prevention programs and road repairs.


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"The city is losing money. We're in the red for the next two budget years. (The city) is doing everything as far as I can tell to adjust costs," said campaign Chairman Tim Flaherty, who serves on the city's planning and civic action commissions.

"I think the opposition is saying it's not a good time. "... Well then, when is a good time? When we have to close City Hall for two days a week or furlough employees? Is that when we go forward and ask?"

Currently, the utility tax only applies to intrastate landline phone service, and brings in about $189,000 per year. The city estimates the higher tax would generate about $1.2 million annually, which amounts to an average of $86 per household. It would apply to residential and business customers, but public schools, Diablo Valley College and residents participating in rate reduction programs for low-income households would be exempt. The ordinance gives the council the authority to reduce or suspend the tax without voter approval.

Critics of the tax hike say city employees' salaries and benefits are too generous. They believe the city should do more to cut personnel costs, such as making employees contribute to their retirement. Pleasant Hill paid about $840,000 to cover employees' CalPERS contributions in the 2009 fiscal year, according to Mary McCarthy, finance director.

Supporters note that the most recent budget froze 22 vacant positions, including several top management posts. They also point out that the contract police officers agreed to last year tied raises to the city meeting revenue targets, which didn't happen.

Ultimately, both sides agree, voters will have to decide whether they believe the city needs more money to maintain basic services. Wendy Lack, who opposes Measure T, said the council has offered a "false choice" between raising taxes and laying off police officers. They should do more to cut spending, she said.

Flaherty disagrees. "It's not all about limiting costs, you also have to address the revenue side of the ledger," he said.

Lisa P. White covers Martinez and Pleasant Hill. Contact her at 925-943-8011. Follow her at Twitter.com/lisa_p_white.