FUNDING OUR FUTURE
City Budget and Ballot Measure PP Information
As a full-service city that provides essential services and facilities, the City works in a fiscally responsible manner to sustain the services that residents tell us they value most: rapid 911 emergency response services, safe neighborhoods, quality streets and roads, maintaining and preserving our parks and open spaces, supporting local businesses, and programs for youth and seniors. The City’s General Fund budget provides funding for a wide range of services and infrastructure. The City’s Long-Term Financial Forecast and the draft 10-Year Infrastructure Plan have identified budget deficits and significant funding needs for services and programs and repair and replacement in future years, as community-owned assets age.
The City is now considering new revenue options to responsibly address community needs as City leaders also engage with the community to ensure residents’ voices are heard on important decisions that are being made.
Additional information about this initiative and why the City is exploring it now can be found below.
Questions?
Take a look at our detailed FAQs section.
Budget Information
Visit the City’s Budget Overview webpage for more detailed information on the City’s budget process, financial forecast, and Pension 115 Trust.
View a Fact Sheet with information on the City’s budget and Measure PP facts.
The Spring 2024 Special Edition Pleasanton Progress is all about the City’s budget challenges and steps being taken to address them.
View Special Editions of the City’s e-newsletter that focused on the City’s financial challenges:
View a mailer that was sent to all addresses in Pleasanton with registered voters in mid-February. (Note: This is provided as information; the survey closed in late April 2024).
Measure PP Information
For more information about Ballot Measure PP, including ballot language, the proposed ordinance text, and arguments in favor and against the measure, visit the City’s November 2024 Measure webpage.
View this palm card with information about Measure PP.
Contact Us
For more information, or to share questions and feedback email PleasantonListens@cityofpleasantonca.gov or call Heather Tiernan at (925) 931-5044.
Community Information
- September 19, 2024 – Press Release – Pleasanton Budget Update Highlights Financial Challenges and Strategic Actions
- September 17, 2024 – City Council Meeting – Presentation of City Budget Update in advance of the upcoming 2-year budget development process
- July 18, 2024 – Press Release – City Council Approves Resolution For Sales Tax Ballot Measure
- July 16, 2024 – City Council Meeting – Final decision of whether or not to move forward with a 1/2 cent sales tax measure on the November ballot – View the Agenda Report.
- June 18, 2024 – City Council Meeting – Presentation on polling results associated with revenue measure feasibility; Adopt FY 2024/25 Mid-Term budget (adopted at May 21 City Council Meeting); Review language for a potential ballot measure to increase General Fund revenue ( 1/2 cent sales tax)
- June 4, 2024 – City Council Meeting – Presentation on community survey results associated with City priorities
- May 21, 2024 – City Council Meeting – FY 2024/25 Mid-Term Budget Update
- May 21, 2024 – Budget Workshop – View the Agenda Report that introduces potential future service reductions (Contingency Menu) if revenues do not increase
- May 21, 2024 – City Council Meeting – Presentation on the use of Pension Trust funds to reduce the projected General Fund deficit
- May 20, 2024 – Press Release – Pleasanton to Host Public Budget Workshop to Discuss Possible Cuts
- March 19, 2024 – City Council Meeting – View the Agenda Report presenting financial forecast assumptions and proposed reductions to discretionary spending.
- March 19, 2024 – City Council Meeting – View the Agenda Report recommending the reallocation of CIP funds to fund life-safety projects.
- December 19, 2023 – City Council Meeting – View the Agenda Report requesting funding for a community engagement campaign
- December 5, 2023 – City Council Meeting – View the Agenda Report introducing the topic of a potential revenue measure and a list of revenue options presented
FAQs
Why does the City need more funding?
Pleasanton is facing a severe and increasing structural deficit, meaning that expenses have and will continue to grow faster than revenues. Current forecasts indicate an average budget shortfall of approximately $13 million annually over the next eight years.
The City’s General Fund supports both City services and infrastructure. As the community has grown over the years, City services and programs have expanded to accommodate the increase in service demand. The City lost more than $11 million in hotel tax revenue during the pandemic and has not fully recovered to the pre-pandemic level, impacting the City’s financial stability.
What is the City doing to manage its finances responsibly?
The City of Pleasanton is committed to responsibly using the community’s money as we continue to provide the services it expects and prioritizes. We are working to cut costs from our budget, we’ve already cut $2.5 million from this year’s budget and are looking for more ways to save. Every time we have a financial decision to make, we consider all options to determine if, and how much, should be spent.
As the community has grown, the City has added new amenities and services without increasing staffing levels and resources proportionally. As new parks have been added, staff to maintain and run them have not increased at the same level. As new miles of roadway have been added to the city, street maintenance staff and engineers have not been increased proportionately. As the population has increased, police and fire staffing numbers have not increased proportionately.
What has the City done to contain costs and increase revenue?
The City has been working to proactively address projected budget deficits with a combination of reduced costs and new revenue. We have cut over $2.5 million from this year’s budget. We aren’t starting new programs that don’t pay for themselves. We’re cutting back on contractors where we can. We’ve frozen multiple vacant positions.
We’re looking at ways to increase revenue like increased fees for development and adjusting user fees for City facilities.
Over time, the City has made changes to its organizational structure, compensation packages, and operating strategies to reduce costs and improve efficiency. Reduced retiree health benefits are being offered to employees, and all City employees now contribute their maximum share towards the employee’s portion of the pension contribution. The City has also been proactive in setting funds aside in a pension reserve and established General Fund reserves to weather economic uncertainties.
How will the money from a sales tax increase be spent?
Any funds raised by a voter-approved local revenue measure would go directly into the City’s General Fund to that could be used to maintain City services, and minimize cuts to such services, such as:
- Police and fire protection
- 911 emergency response
- Disaster preparedness
- Pedestrian safety
- Park maintenance
- Pothole repair and street maintenance
- Recreation programs
- Open space preservation
- Other general government uses
This tax would be a “general tax,” meaning that revenues raised from the tax would go into the City’s general fund to pay for any lawful City program, improvement, or service.
How much would a new measure cost?
A half-cent sales tax increase would cost an additional ½ cent for every dollar spent. For example, for every $100 spent on taxable goods, the tax would increase by 50 cents.
What would a sales tax apply to? What’s taxed and what isn’t?
Sales tax applies to a variety of goods and services including things like furniture, cars, toys, antiques, clothing, and gasoline would be subject to the tax. Items that are exempt from sales tax include groceries, prescription medicine and certain medical devices, and sales of items paid for with food stamps. In addition, many labor costs are exempt from sales tax.
How much new funding would a ½ cent sales tax generate for the City?
A ½ cent sales tax would generate approximately $10 million per year for City services. ALL funds generated by the local sales tax would be locally controlled and would stay in Pleasanton to provide essential City services, programs, and facility improvements. By law, the State could not take this funding away.
While work continues to protect the things our community values the most, the City is prepared to cut costs to balance the budget if needed. However, those cuts will impact the quality of life for all residents. This is what we are working to avoid.
What happens if the City doesn’t pass a revenue measure?
While the City is working to protect the programs and services our community values the most, we are prepared to cut costs to balance the budget if needed. However, those cuts will impact the quality of life for all residents. A draft contingency plan of cuts that may become necessary if revenues are not increased.
Why did the City choose a sales tax ballot measure for the November election instead of a hotel tax or other specific tax?
A ½ sales tax is the best way to increase revenues enough to allow the city to continue to provide the same level of service to Pleasanton residents now and into the future. In addition, a sales tax increase would ensure that visitors pay their fair share for the use of Pleasanton services while not impacting certain essential purchases like groceries, prescription medication, and medical appointments.
Why aren't we talking about water?
The City’s Water Fund is separate from the City’s General Fund; the cost to operate and maintain the City’s water programs comes from user fees, not the General Fund. Providing reliable, safe drinking water is a top priority for the City, and we have prioritized a number of water related projects over the past 18 months to ensure we continue to deliver quality water throughout our community. Increased revenue from a recent water rate adjustment will help stabilize the City’s water fund and was necessary to secure financing to complete some of the projects and improvements. The City is considering additional funding sources for water specific projects including state and federal grants, a lawsuit against PFAS contributors, partnerships with Zone 7 for cost sharing, and potential future bond measures.
The budget deficit being discussed now is in addition to the gaps in funding for water projects, and being addressed separately.
How long would a sales tax increase last?
How much of the revenue generated by a local sales tax goes to the State?
Where does the money from our current sales tax go?
- CA Sales & Use Tax – 6.25%
- State General Fund/Realignment – 5.5%
- County Public Safety – 0.5%
- County Transportation Fund – 0.25%
- City/County Local Tax (direct to Pleasanton) – 1%
- Transaction & Use Taxes: Other Taxing Agencies – 3%
- BART – 0.5%
- Alameda County Transportation Commission – 0.5%
- Alameda County Transportation Sales Tax – 0.5%
- Alameda County Health Care Services Agencies – 0.5%
- Alameda County Children’s Health and Child Care – 0.5%
- Alameda County Transactions and Use Tax – 0.5%
Won't people just shop somewhere else if our sales tax increases?
Studies show that people do not change their shopping habits based on sales tax rates and they do not consider sales tax when choosing the place they want to do their shopping.
How have Pleasanton’s staffing numbers changed over the past 5 years?
Pleasanton’s staff has increased by less than 5 staff members over the past 5 years. Note that several of these positions, while funded in the current fiscal year budget, are frozen as part of the City’s cost containment measures. These positions include the Chief Diversity Officer, Sustainability Manager, and Evidence Technician.
| FY 2019/20 | FY 2020/21 | FY 2021/22 | FY 2022/23 | FY 2023/24 | FY 2024/25 | |
|---|---|---|---|---|---|---|
| Budgeted FTEs | 431.87 | 432.02 | 432.25 | 433.38 | 434.38 | 436.38 |
How do the staffing levels in Pleasanton compare to comparable neighboring cities?
Pleasanton provides a full range of services to the community, including police, fire, library and recreation services, and water collection and distribution. Not all cities provide the same services, so comparing staffing numbers between cities is difficult. The Cities of Hayward, Livermore, and Milpitas are the closest match to Pleasanton in terms of services provided to the community. The chart below shows staffing comparisons between the cities, both for total citywide positions, and sworn police officers.
| City | 2024 Population | (Budgeted) Citywide Positions | Positions per 1,000 Residents | (Budgeted) Sworn Police Officers | Sworn Officers per 1,000 residents |
|---|---|---|---|---|---|
| Hayward | 159,770 | 949.3 | 5.94 | 197 | 1.23 |
| Livermore | 84,828 | 497.375 | 5.86 | 98 | 1.16 |
| Milpitas | 81,773 | 450 | 5.50 | 94 | 1.15 |
| Pleasanton | 75,960 | 436.38 | 5.74 | 83 | 1.09 |
Why was funding for the expansion of the Skate Park and renovation of the Century House diverted to other capital projects?
Storms in early 2023 resulted in significant damage and repair and replacement costs to the City’s storm drain system. The Skate Park expansion and Century House projects were among the $18.9 million projects defunded/deferred by the City Council on March 19, 2024, to fund the storm drain projects that will reduce flooding in our community during heavy rain.
Why does the City have a significant infrastructure funding gap?
The City’s infrastructure and facilities are aging. Pleasanton realized rapid growth in the 1980s and 1990s when buildings, parks, streets, and other community assets were constructed. While the City has contributed significant resources to maintain these assets and has continued to add community assets since then, many are reaching the end of their useful life, and sufficient funds have not been set aside to replace or rebuild them.
In 2023, the City completed a high-level infrastructure assessment that showed the City needs approximately $900 million over ten years just to keep current infrastructure usable.
A more in-depth asset management plan is being developed better to understand the City’s total infrastructure funding gap. The plan will identify the necessary financial resources to repair and replace aging community assets.