Calabasas to keep utility tax
By Sharon Makokian
Acorn Staff Writer

Calabasas won’t abolish or lower its utility user’s tax for now, as some councilmembers had previously proposed. The city council made its decision at a recent meeting.

Citing a down-turned economy and possible loss of income from the state, council-members said that utility taxes are needed to pay part of the costs of running the city.

"We are facing uncertain times," said Mayor Pro Tem Lesley Devine. "Our budget has a lot of things in it based on a lot of (state funds) that can be taken away in the next six months."

Devine noted that the 2001 budget planned for utility taxes to make up 16 percent, but that figure turned out to be 24 percent of the actual working budget.

"We can lose it and lose the entire sheriff’s department or the park and rec department," she said. "Where do you cut (funds) in a small town on a small budget?"

The tax cut has been prompted in other areas, too, by the idea that higher utility rates had caused cities a windfall in revenue, but City Councilman Dennis Washburn said that’s not the case in Calabasas.

"It’s almost a wash. The utility user’s tax receipts increased around 8 percent, but (the city’s) utility cost were up around 9 percent. We’re a user as much as a beneficiary," said Washburn.

"The city’s residents have become accustomed to a (certain) level of services," he said.

City Councilman Michael Harrison, who had originally proposed a temporary utility tax cut, concurred.

"Taxes are the price we pay for civilization and the people of Calabasas want civilized services," he said.

"We’re far from a windfall. (The city) is like running a household—our bills are going up, too," said Mayor Janice Lee, noting that a crisis (such as a fire or earthquake) can throw off the city’s budget just as a household emergency can for families.

"We are dependent on a certain revenue flow—we need to keep that going. I believe that the data is pretty clear … I really do believe we’re about to embark on tough times, economically … fiscally, we have to stay the course," Lee continued.

City Councilman James Bozajian had originally proposed a utility tax rate decrease, but abandoned the proposal after hearing his colleagues’ comments.

Recently a group of citizens submitted an initiative measure to bring the issue to repeal the tax to the voters. They’re now trying to get the utility tax on the March ballot (see related article).

The council did approve a "housekeeping" resolution to modernize city’s utility tax ordinance. Since adoption of the original law, a number of technological, regulatory and legal changes have occurred requiring updated clarification of the old ordinance, said City Manager Donald Duckworth in a report to the council.

One thing the new ordinance will do is allow the council to lower or repeal the taxes or make other changes without amending the new ordinance.