At last night’s meeting, the Novato City Council unanimously voted to place a sales tax measure on the November 2024 ballot for voters to consider. The measure would set Novato’s sales tax rate at 9.25% and bring in an estimated $10.3 million annually, with 100% of the funding remaining in Novato for local services. With this increase, Novato’s sales tax rate would be at or below the rates in neighboring cities like San Rafael and Petaluma.
For several years, the City has experienced growing systemic budget deficits. The ongoing deficits are projected to be between $3.3 million to $3.8 million over the next five years, and will continue to grow without service reductions or enhanced revenue. Novato has taken a multitude of actions to contain costs including cutting city staffing by over 30 positions to reduce operating costs, updating the comprehensive user fee schedule to improve cost recovery, reducing investments into deferred maintenance including streets and parks, conducting organizational assessments to ensure efficient service delivery, outsourcing programs for cost savings and pursuing grants.
"There was less demand for services 50 years ago, which is where the structural deficit began. We have the opportunity to make this right and I strongly believe that we need to give this team a chance," said Mayor Mark Milberg. "I'm very proud of the Council and of the work that we're doing and I am blown away with how much our staff cares about this community. We're on good footing, and it's time to move this City forward.”
Mayor Pro Tem Tim O'Connor added, "If the City receives this funding, it's going to our roads, going to our police officers, going somewhere that needs it."
Nearly 70% of the City budget funds employees who deliver essential services to local residents, with the largest portions being:
- Police officers and emergency services personnel responding to 9-1-1 calls and maintaining public safety;
- Public Works employees fixing potholes, repairing streets and sidewalks, maintaining parks and repairing City facilities; and
- Parks, Recreation and Community Services employees running programs for children, youth, families and seniors.
At the July 9, 2024 City Council meeting, the results of a poll assessing the viability of a locally-controlled sales tax were presented. The survey indicated that nearly 60% of Novato voters support enhanced sales tax funding to support the community’s priorities. This information was presented to the Finance Advisory Commission (FAC) at a special meeting on July 18, 2024, and the FAC unanimously recommended the City Council take action to place a local sales tax measure on the November 5, 2024 ballot.
In addition to approving consideration of the ballot measure, Council also approved motions to ensure fiscal oversight protections including reevaluating the measure’s necessity at year 10 and every 5 years thereafter, clarity that the measure would be subject to independent annual audits and would receive oversight from a citizens’ oversight committee.
If approved by local voters with a majority vote (50% plus one), Novato’s local sales tax rate would add 7½ cents to a $10 purchase, which would be paid by anyone shopping in Novato, including visitors from other communities. Essential purchases like groceries, medical & dental services, utilities, and prescription medicine are exempt from sales tax, helping to ensure the cost is not a burden to residents on fixed or limited incomes.
For more information, please visit novato.org/localfunding or contact Assistant City Manager Jessica Deakyne at (415) 899-8903 or AssistantCityManager@novato.org.
