Goleta Drops Sales-Tax Plan to Avoid Posing Challenge to Measure A

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By Rob Kuznia, Noozhawk Staff Writer

Bennett says Santa Barbara County may be open to discussing the revenue-sharing agreement after all.

In an abrupt reversal, the Goleta City Council on Tuesday night backed away from plans to place a citywide sales tax measure on the November ballot. The Goleta initiative could have derailed Measure A, a $1 billion Santa Barbara County transportation tax that, if approved, will fund projects over the next three decades.

Although the Goleta gambit could have been a bluff from the start, several council members as late as last week advocated the move as a way to gain leverage in a long-running dispute with the county, which has been reluctant to renegotiate a revenue-sharing agreement the parties entered into when Goleta incorporated in 2002.

Goleta has said the revenue-neutrality agreement — which, by law, counties can require for aspiring cities — is a raw deal, costing the city an estimated $8.2 million in tax revenue next year alone, or a third of its revenue.

The idea was that a sales tax initiative for Goleta would have allowed the city to recoup some of those costs. It could have jeopardized Measure A because that initiative needs a two-thirds majority to pass, and some feared that many Goleta residents would be reluctant to approve both measures, and would favor the local one over the regional.

At Tuesday’s council session, Goleta Mayor Michael Bennett surprised many in the audience by swiftly wrapping up the matter with a short prepared speech before the council voted unanimously to scrap the idea.

“We do not want to be the cause of Measure A failing in November,” Bennett said. “We want to work with the county. There is no good that can come out of an adversarial relationship.”

Also terminated was a ballot proposal to let Goleta voters decide whether they wanted to back out of the revenue-neutrality agreement. The legality of that option had been questioned by county officials.

After the meeting, Bennett was guarded about the reason for the about-face, but he did say that county representatives recently expressed an interest in talking with Goleta officials.

“I am confident we can accomplish our goals over the next year,” he said.

Goleta also had been under pressure from other cities to drop the idea, most vociferously from Carpinteria City Councilman Joe Armendariz, who attended Tuesday’s meeting in Goleta.

There’s a good chance the idea of a Goleta sales-tax measure was a lost cause even without the change of heart. Putting sales-tax measures on the ballot requires a council supermajority — which in Goleta means four of five votes. Only three council members had expressed support for it: Bennett, Jean Blois and Eric Onnen. Council members Roger Aceves and Jonny Wallis were opposed.

However, the measure asking Goleta residents whether to just say no to the revenue-neutrality agreement would have required a simple majority three votes.

Revenue-neutrality agreements prevent counties from losing a disproportionate amount of money from sales and property taxes that would start to go to a new city. Bennett and other Goleta officials have said the agreement is particularly hard on Goleta, and that it is the worst of its kind for any new city in California.

Per the 2002 agreement, the county takes half of Goleta’s sales and property taxes and 40 percent of its hotel bed taxes. Beginning in 2012, the deal would get a little better for Goleta, reducing the county’s share of the sales tax by 20 percent and allowing Goleta to keep all of its bed taxes. However, the terms of the agreement are to go on in perpetuity — in other words, for forever.

Noozhawk staff writer Rob Kuznia can be reached at .

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