S.6 Update on Cost Recovery and Revenue Enhancement
·RECEIVE an update on the Cost Recovery and Revenue Enhancement tracking document and Options for Long-term Fiscal Sustainability; and PROVIDE input to City staff – City Manager’s Office (Shasa Curl/LaShonda White 620-6512).
This letter is being submitted on behalf of the Council of Business & Industries. Whereas we support the city being fiscally responsible, that the city ensures city services meet the expectations of the community and businesses that operate in the city, and, that the budget is balanced – however, focusing only on revenue enhancements is not being responsible to property owners, residents and businesses.
In addition, the city needs to focus on cost containment, and we have yet to see an analysis of such.
The majority of the twelve recommended “Revenue Enhancement Options” will impact property owners, residents and businesses. According to the agenda report, estimated revenues from this group (excluding the ECIA) will result in $15.5Million of the $27.3 Million estimate.
It is concerning that such an important discussion should be delegated to the end of city council agenda that is already very impacted. In addition, the material that is posted on the website – particularly “Proposed Revenue Generators” – which appears to have a great deal of information, is unreadable due to the font size.
We understand that more information will be brought back to the council, please consider providing comment regarding the following:
1) The Agenda Report notes that Management Partners were authorized to “gather best practices from around the country that might be good options for Richmond to Consider”- what local, similar cities were contacted and what was their input.
2) The Agenda Report states that the consultant will look at feedback from stakeholders and unions – has any feedback been requested from residents, the business community, and Economic Development Commission?
3) The recommendations include THREE parcel or property taxes (vacant parcel tax, library services parcel tax, transient occupancy tax increase to 10%, increase real property transfer tax by 20%). These total $9.5Million if all were implemented.
4) Impact to residents would include an additional $6Million by raising the utility users tax rates by 1%, creating neighborhood improvement districts and increasing cost recovery on recreation services, if all implemented.
5) We have approximately 15,000 seniors in our city the majority on fixed incomes – will they be able to afford increases in property taxes? This could severely impact them. In addition, some property owners use their rentals to support their retirement. Have you reached out to property owners to determine if they can take on this additional tax burden?
Two years ago, you put more burdens on businesses with a new tax. Now, you are targeting property owners and residents with these “revenue enhancements” totaling $15.5Mil – putting 56.8% of the increased tax burden on them.
6) The revenue enhancers recommended for the city total $2.8Million. These would include the option to increase the cost recovery on planning, building services – how does Richmond compare with other similar cities? Increasing city permitting fees beyond what other similar cities charge will not incentivize developers to consider projects in this city.
7) What local, comparable cities were contacted for their “best practices” to increase revenues and what information was provided?
We are still recovering from the pandemic – individuals and businesses. Any additional taxes and fees need to be fully vetted and shared with the public prior to final decisions being made. This should be done in parallel with cost reductions.
