On this November’s ballot the Salida City Council will have a de-Brucing measure for the voters. De-Brucing refers to an action allowing voters to approve the ability of a municipality to keep and spend all of its revenues, even those which are above the TABOR limit.
TABOR sets very stringent limits on the amount of yearly increases in revenue allowed. The calculation is considered to have a “Ratchet Down Effect” since once revenues drop, say in a recession period, the allowable increase doesn’t grow fast enough to return to previous levels. This is because the base is always the previous year and population growth is not part of the formula. Cuts tend to become permanent and thus basic services can be impacted.
TABOR controls three areas: revenue, taxes and debt, requiring voter approval for increases. This ballot measure will only address revenue increases, so voters will continue to be asked to approve any tax increase or any new tax.
The City has already de-Bruced its sale tax, which is the greatest portion of City income, but fees are not de-Bruced. Generally, fees are too small an amount to have an impact on the calculation. However, in years when the City receives grants to assist with required State upgrades for the water or wastewater treatment plants, the situation changes. The water and sewer fees are then considered to be revenue in the TABOR formula since enterprise or business status is lost.
I urge you to support this ballot measure. It will help stabilize the availability of basic City services, especially after a recession or in years when State grants are utilized.