In 2005, voters in Scotts Valley approved a quarter-cent sales tax for five years in an effort to cover the town’s budget deficit. Now the tax is about to expire, and that source of funding will dry up. City Councilmember Stephany Aguilar says that the city has no choice but to extend the tax, and she’s collecting signatures to have an extension placed on the ballot next year. Without it, she says, Scotts Valley is faced with a $926,000 deficit. “We need to keep it at least status quo until the economy rebounds,” she says.
Not everyone agrees, however, including Mayor Jim Reed, who worked to get the tax passed in 2005. Reed now says that the city has other potential sources of revenue and that extending the tax during a recession is irresponsible. These sources include a pending lawsuit against Santa Cruz County for payment of $3 million in back taxes and another $500,000 or so per year. The city won its case against the county in Superior Court, but the county has appealed the decision. Reed also says that the long-planned town center, still in its early stages of development.
Most of all, Reed rejects the idea of Aguilar moving ahead unilaterally by collecting signatures in support of a ballot initiative. If the city is to raise taxes, he says he wants it to be a decision by the entire City Council, and not just a single member. Read more at Fox 35.
