City of Visalia
General Fund Revenues
Blue Ribbon Task Force
May 14, 2013
Two Trends in the
General Fund
• Dominance of Visalia’s sales tax has
declined
• State continues to eat away at local
tax revenues
– The State is the third largest
department in the City’s General Fund
after Police and Fire
General Fund Revenues Per Capita
$1,000.00
$900.00
$800.00
$700.00
Bakersfield
$600.00
Clovis
Fairfield
$500.00
Fresno
$400.00
Tulare
$300.00
Visalia
$200.00
$100.00
$2007
2008
2009
2010
Note: Fresno data estimated for 2010.
Visalia’s General Fund Revenues Per Capita
trails other governments
If Visalia had the same sales tax dominance today as it did in
the 1980s, the General Fund would have another $6 million
Cities in Tulare County
Varied Tax Bases
Share of 1%
Property
Sales Tax
Tax Rate
Override
Dinuba
18.79%
0.75%
15.32%
None
Exeter
11.81%
0.50%
Farmersville
14.79%
0.50%
Lindsay
11.80%
0.50%
Porterville
14.09%
0.50%
Tulare
11.57%
0.25%
Visalia
15.76%
None
Woodlake
Utility Users Tax
Rate
7%
5%
None
6%
6%
6%
None
6%
TOT tax
10%
4%
None
15%
8%
10%
10%
None
Visalia has a more narrow tax
base than other cities
State Take-aways and
Local Revenue Response
• 1992 and 1993, the State takes local
government property tax
– Visalia loses $3 million a year in property taxes
– 6 out of 8 Tulare County cities respond by
imposing a Utility Users Tax
• A 6% UUT would raise $10 million for Visalia
New Revenues
• 2004 Visalia pioneers a local option Sales
Tax for operations at ¼ percent
– Limited by legislature to ¼ percent
– Conservative – was most that was available
• Legislature opens door wider
– 5 other Tulare County cities adopt not a ¼ cent
sales tax but either ½ or ¾ percent tax
• Another ¼ cent tax would raise $5 million for Visalia
More State Take-aways
• 2007, State swaps all but $600,000
in motor vehicle in-lieu (property tax
on your horse) for property tax
– However, charges the City for
administration of the fee for all of the
Motor Vehicle In-lieu fees of $8 million.
– Eventually, all Motor Vehicle in-lieu fees
are kept by the State
Yet More State Takeaways
• State in 2011 requires ends
redevelopment unless a City makes a
“contribution” to the State
• Cities sue
• Courts find that “contributions” are
not legal but State may kill
Redevelopment
• City losses $ 4 mm a year net in economic
development and housing funds
Trends
• Economic trends have reduced the
value of the City’s Primary General
Fund revenue – Sales Tax
• The State has taken City revenues
which would otherwise been available
for City services – 3rd largest
department of the City
• Other cities have found revenue
replacements
If Visalia had the same worker ratio as 20 years ago,
the City would have 100 more workers
Visalia vs Tulare
Average General Fund Spending Per Captia FY 2011/12
Tulare
Population
59,089
GF Revenues
33,379,000
Per Capita
565
Visalia
125,770
54,660,000
435
Difference
130
Cost of Living Comparison
Local tax Burden For Family of 3 - 2013
Ave. Median Income
Median Home Value
Visalia
54,019
212,500
Tulare
46,274
183,700
Why
Taxes Received by the City
Property Tax Portion
Property Tax Override
Sales Tax Portion
Sales Tax Override
Utiltiy Taxes
Total
238
153
180
45
616
Revenue
Taxes Received by City
249
325
159
77
220
1,030
Visalia
24,649,364
Tulare's rate higher portion of 1%
Tulare more overrides
Visalia higher incomes
Tulare 2x Visalia's rate
Tulare has UTT
Tulare
41,194,001
Difference
16,544,637
Things to remember
1. Visalia’s historical sales tax
dominance has faded
2. The State has taken general
revenues of the City to solve their
budget problems
3. Other governments have a broader
General Fund tax base:
–
–
Utility Users tax
Higher sales tax override
4. Other Local Governments are now
spending more per capita than Visalia