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City mulls tax increase for infrastructure repairs

Original post made on Mar 28, 2012

Palo Alto may ask its voters to approve a tax increase this year to pay for needed infrastructure repairs, though the city has yet to decide which tax to modify and what kind of rate change it should pursue.

Read the full story here Web Link posted Wednesday, March 28, 2012, 9:54 AM

Comments (39)

Posted by Ernesto USMC, a resident of Ventura
on Mar 28, 2012 at 10:51 am

The city has plenty of money. They unwisely chose to spend it on overpaying their own workforce. This may be politically convenient (many of the council members take a lot of money and support from the unions), but it is essentially stealing from the taxpayers, who receive less service than they pay for.

In deciding to give all of our money to the unions, as well as a lot of our children's money to the unions through unsustainable pension promises, the city chose to neglect infrastructure. What little remained was frittered away on pet projects such as bike bridges and the Homer ave tunnel.

Now the city has the nerve to try to extract more tax revenue from the public, while continuing to pay firefighters close to 200K? Streetsweepers costing nearly 100k? See the compensation figures in the link below. The amount of waste is staggering.

Web Link

The city should bid out all services (except realistically police), and allow the current workers to compete for the jobs. Cities that require their unions to bid against the private sector often find that the union's suddenly realize they can deliver the same services for often 40-50% below what they'd previously insisted they were worth.


Posted by Kim S. , a resident of Old Palo Alto
on Mar 28, 2012 at 10:56 am

I completely agree with Ernesto. I'd also like to add that I don't trust our council to spend any additional money they receive wisely. Look at the overages for the new library.


Posted by Taxed Out, a resident of Old Palo Alto
on Mar 28, 2012 at 11:25 am


"I think we're going to want to know from the community and that will help inform our decision," Burt said.

No More Taxing the citizens of Palo Alto.. Start doing your job and better manage the exorbitant amount of money we already give this city. Or why do you just keep hiking the utility rates. Seems like it is a convenient approach to the continued fleecing of the community you work for...


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Mar 28, 2012 at 11:29 am

We have reached this point due to poor civic planning, irresponsible spending, and a lack of financial priorities on the part of our city leaders and elected officials. Over the past several years they have been decrying unprecedented financial challenges and annual budget deficits. Vital infrastructure and public safety needs have been neglected and continually pushed to a back burner. It has reached a point when these essential needs have to be addressed, and what's their solution, raise taxes to pay for it. Unreal.

Let's compare the financial problems the city is experiencing to that of a homeowner. A homeowner that is faced with a budget deficit and is having difficulty paying their bills. If the homeowner had a leaky roof, broken water line, and cracks in the driveway, most of us would agree that it would not be the best time to install a swimming pool, buy a new car, or build an addition on the house. No, of course not. That person would do what most of us have to do. Make sacrifices, cut unnecessary spending wherever possible, and set some funds aside to pay for the essential work that has to be done, namely paying the bills and maintaining the basic infrastructure of the house. The very unrealistic option would be for the homeowner to go to their employer, after burying themselves in debt, and asking for a pay raise to solve their financial problems. This analogy is similar to what our city leaders and elected officials are in the process of doing here. It's not a realistic option in the real world, and it shouldn't be one here either.

I absolutely resent the thought of having our taxes increased in order to pay for vital, essential civic needs that should have been already completed and paid for. The vital needs we are faced with now are not new. These issues have been on the table for many years, only to be pushed aside and dismissed. Personally I will object to any tax increase until some serious sacrifices and cuts are made in non-essential, niche programs and projects.

Under the current economic climate, why have we been spending millions of dollars in public funds on a myriad of these non-essential public projects and programs? Why are preparing to spend millions on a bike bridge, golf course redesign, new playground construction, park upgrades, public art, and commercial district beautification? Why is tax payer money being used to help fund the Children's Theater? Why do we continue to donate public money to homeless service programs that serve few if any people with true ties to our community?

There are many sacrifices and cuts that can be made to help mitigate the budget deficit. Those savings can be deferred to fund the vital and essential civic work that needs to be done. We need to limit if not eliminate the frivolous, irresponsible spending. Niche projects and special interests need to be told, no. Enough is enough. Let's demand some common sense and responsibility from our city leaders, and not let them off the hook. Maybe if the public trough goes dry they will finally start to do the right thing.


Posted by Need some information, a resident of Palo Alto Hills
on Mar 28, 2012 at 11:44 am

One place to start would be to inform the public about the City Manager's take.
Salary, benefits, home mortgage, automobile? What else, anyone know? We need a complete list with amounts.


Posted by pat, a resident of Midtown
on Mar 28, 2012 at 11:51 am

Well put, Marrol!

It's hard to believe the council would even consider asking for more money to pay for what should be a top city priority: infrastructure. If the city government had been paying attention for the last 20 – 30 years, repairs would have been done in a timely manner and money would have been saved in a reserve fund for infrastructure. Instead, the Children's Theatre, Zoo, a bike tunnel, a golf course, 5 libraries and other non-essentials ad infinitum — plus humongous consulting fees for projects that should have been done by staff members — have consumed our tax dollars.

They just don't get it. They're insulting our intelligence by planning for a pricey bike bridge ($9M or more) and wider sidewalks on Cal Avenue (an additional $500K to $1.5M over current project estimates) while asking us for more tax dollars!

JUST SAY NO!


Posted by Kate, a resident of Duveneck/St. Francis
on Mar 28, 2012 at 12:34 pm

This 'threat" of more taxes is just what 'don't have a clue' residents need to wake up to the city's constant request for more money while it outrageously spends on non-essentials. This is not going to fly so don't waste any more $$$ on election and ballot expenses. I sense a revolt in the making. City salaries and benefits are the first to cut. Then every non-essential on the list. Do we really need all of these employees some of whom who cook up projects to justify their job. And check the phone book - just how many phone lines does the city need?


Posted by Resident, a resident of Another Palo Alto neighborhood
on Mar 28, 2012 at 12:43 pm

Absolutely no more taxes unless the City is going to curb spending on things like Childrens Theatre and 5 libraries.

If I have to tighten my belt to live in Palo Alto then the least Palo Alto can do is tighten its belt to provide the basic services and basic infrastructure that it needs to its residents.


Posted by Wayne Martin, a resident of Another Palo Alto neighborhood
on Mar 28, 2012 at 12:46 pm

Over the past ten years, I have tried to piece together some sort of infrastructure inventory that might provide some sense of just how many assets the City owns, and what the value/replacement value of that inventory might be. I have been frustrated in this attempt, since the City itself does not actually keep such an inventory itself. So, the best I have been able to do is come up with a back-of-the-envelope collection of assets which are mostly property, and water/gas/wastewater distribution piping that is buried under our streets.

All-in-all, I have come up with a number around $35B. Some of these numbers are cost-to-replace numbers, based on current prices. (For instance, concrete pipe generally costs out at $350-$500/linear foot. As some point, this pipe might need to be replaced, so multiplying City-published lengths of pipe by these per/foot numbers generates a cost-to-replace number, sans inflation.)

The City has recently decided to claim that all of the standing buildings (such as "the police station") are part of the infrastructure. One City Council Member even claimed that the library was part of the infrastructure. We have seen a warping of vocabulary by the current/past Councils, and Staff, so that infrastructure turns out to be anything they want it to be.

The City owns about $20B of land (and possibly more) at current market prices. There is simply no reason that some of this property can not be sold off to provide for future need. The same is true for the City's Utility, which has had management problems in past years. Assuming that the Utility could be sold for at least $1B, the yearly interest on this money, properly invested, would be at least $40M (and as much as $75M if you believe CalPERS money managers).

The idea that the taxpayers, and rate payers, should be gouged to death—which the City can not even produce an estimate of the total asset base it owns is beyond belief. There simply is no reason that the City should not sell off some of this land—even though the new owners will no doubt be creating some problems for us all, once they take possession.

The only answer here is to prioritize the level of so-called "services"--terminating those that are clearly not essential. The City needs to start charging total cost for all use of public buildings, properties, and look at across-the-board reduction in salaries, and benefits.

Enough is enough!


Posted by moi, a resident of Another Palo Alto neighborhood
on Mar 28, 2012 at 4:17 pm

I'd like to keep my libraries, please.

I'd also like to have the cloverleaf ramp between "eastbound" University Avenue and "northbound" Alma repaired. Still the Jersey barriers? How unaesthetic. This is Palo Alto.

P.S. Compass directions in quotations so that all of you NE NW SE SW sticklers can save your 30 seconds for something more rewarding.


Posted by bill g, a resident of Barron Park
on Mar 28, 2012 at 8:44 pm

I've about given up on hoping Council members will take responsibility for managing our City properly. Almost without exception when elected they begin to appease small pressure groups and fund non essential programs instead of maintaining City infrastructure. Marrol has described them very well so I won't repeat his points.

One quibble. The "police station" is part of City Hall and not a stand alone structure. One may argue whether a City Hall is necessary and hence part of infrastructure which needs maintenance, but government must be housed somewhere as do fire stations and police services.

The IRBC has thoroughly described what must be done to catch up and maintain our assets. It should be a no-brainer to follow its recommendations.


Posted by Terry, a resident of Midtown
on Mar 28, 2012 at 9:25 pm

Given the issue, I wanted to express my opinion, but Ernesto and others have already done a great job. Plus 1 here.

Perhaps the city should fund their real responsibilities first, and then try to ask us for a tax increase to pay bloated staff salaries and pensions.


Posted by GougedInMidtown, a resident of Midtown
on Mar 29, 2012 at 7:36 am

Ernesto's comments hit the nail on the head. Even with all this data now becoming public knowledge, the outrage from the public in terms of being actionable is quite muted. I wonder how to take any concrete steps to limit these gold plated wages so that tax money from the public is used to provide public services - not fund ever increasing salary and pension packages.


Posted by Maria, a resident of Duveneck/St. Francis
on Mar 29, 2012 at 8:12 am

Do away with libraries, Children's Theatre, Playgounds? Perhaps if we all become mindless, culture-less robots only interested in food (how many restaurants in PA?), latest cars, cellphone conversations and iPhone games we don't need books, the depository of knowledge from which we can learn, and theatres, where ideas and imagination charge our minds, and playgrounds, where our children can develop physical skills and social interaction. If we take art and physical education out of our school curricula we need to supply them somewhere else in order to educate the whole child; after all, according to Webster's Dictionary "to educate" means "to develop mentally, morally, or aesthetically, esp. by instruction".


Posted by common sense, a resident of Midtown
on Mar 29, 2012 at 8:27 am

The city wants to spend $500,000 on the California Street enhancements (in order to get a matching $1,000,000 grant).

The city spent hundreds of thousands of dollars on studying a bike bridge across 101 (there already is on at Oregon expressway)

The city spent hundreds of thousands in a study for a bike boulevard

The city spent hundreds of thousands in electrical charging stations for electric cars (the only people who buy the expensive electrical cars are the top income earners).

The city donated a property near downtown for affordable housing. If sold on the open market, they city could have garnered millions of dollars.

The city is currently funding 2 houses for the current city manager & former city manager, in the millions of dollars.

The city is funding staff positions related to "sustainability" and "zero waste" for years now, spending hundreds of thousands dollars per year.

I think you all can get that the city has the money to spend on pet projects like "electrical charging stations", but can never find the money to spend on maintaining buildings & roads - instead they want to raise taxes to pay for necessities, while use the existing revenue to pay for their favorite causes.


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Mar 29, 2012 at 10:02 am

And to add to your list Common Sense from Midtown:

The city continues to fund the Children's Theater with public dollars. Very much a niche program that should have been privatized long ago.

The city allocates a six figure allowance to help fund the Opportunity Center and other homeless programs that serve few if any people with legitimate ties to our community.

The city is planning a golf course remodel and athletic field development that is projected well into the millions. Not a basic overhaul as necessitated by the creek/levee improvement, but the luxury version.

The city has spent millions on new playground construction.

While the mayor and city council has demanded cuts in city employee salaries and benefits, they continue to enjoy lifetime medical benefits after serving just one term in office.

The city failed to manage the Mitchell Park Library remodel responsibly, and is now costing tax payers millions in overruns.

Enough is enough.




Posted by Anna, a resident of Midtown
on Mar 29, 2012 at 10:12 am

I agree with all the objections above. It is disgraceful how much mismanagement of taxpayers' money there is. Don't ask for more UNTIL you show you can wisely and fairly spend what we are already giving you!

We have been taxed for years for storm drain upgrades on every utility bill. I haven't seen ANY upgrades at all, even though our street flooded during the big El Nino storm several years ago. What are they doing with all that money? What would they do with this new tax money? Poor management.


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Mar 29, 2012 at 10:21 am

And for Maria from Duveneck, no one is suggesting that we eliminate the Children's Theater, libraries, and playgrounds. Wow, talk about taking an argument to an unreasonable extreme. What people are asking is should we be funding the Children's Theater, very much a niche program, with public dollars. We don't fund Little League, AYSO Soccer, Pop Warner Football, and a myriad of other children's programs with tax payer money. I contend that it should be no different for the Children's Theater. The relatively small percentage of families that participate in the theater program can pay additional dues and fund raise like everyone else. This is a good example of a sacred cow and special interest group that our city leaders and elected officials are hesitant to touch.

As for the libraries, no one is suggesting that we eliminate libraries, but does a city our size require as many libraries as we have. Quite frankly, I believe we could have easily downsized that number by at least one or two, especially since we are pouring millions of dollars into the remodel and development of the Mitchell Park Library. A project by the way that has been so mismanaged that it is now costing tax payers additional millions in overruns.

An no, of course we don't want to eliminate playgrounds. But during these unprecedented and difficult financial times, and with the city facing annual budget deficits, was this the time to allocate millions of dollars into NEW playground construction? I think not. The playgrounds we had would have served our children just fine at least until we funded our vital and essential needs in the critical areas of public safety and and infrastructure.

Myself and many others are not suggesting that we eliminate or never build another playground, improve a park, sponsor a social program, or erect public art. What we're asking is that can we please balance our budget, pay our bills, and fund our vital civic needs before we continue to spend on these other pursuits, and without having to pay more taxes.


Posted by common sense, a resident of Midtown
on Mar 29, 2012 at 10:55 am

CalPERS reduced their projected rate of return from 7.75% down to 7.5% (the staff at CalPERS recommended to lower it 7.25%, but the politicians didn't want to). This will require the city to use more of the budget to contribute to city staff's pensions.

So guess what would happen with the proposed tax money? a bunch of it won't be going to infrastructure; instead it will be going to the larger pension fund payments.


Posted by Joseph E. Davis, a resident of Woodside
on Mar 29, 2012 at 12:34 pm

I'm not overly optimistic, but perhaps our gold-plated bureaucrats and so-called "public servants" have finally priced themselves out of a job.


Posted by long time resident, a resident of College Terrace
on Mar 29, 2012 at 5:12 pm

We, the home owners of Palo Alto are being taken for the ride. City administration, workers and consul exist to serve us because we pay them. That we do, but service? I think that we let them to get away with mismanaging our city at our expense for far too long. I am not sure what course of action is available to us except not vote for any more taxes. The fact that our hired help is contributing next to nothing to their pension and other benefits is beyond any reason and business sense. Can we have vote on this?


Posted by Carlito Waysman, a resident of Old Palo Alto
on Mar 29, 2012 at 5:33 pm

We need some assistance from the CIA on how to organize and overthrow the City Council, reform the way the Business of this City are run and elect a City Council with REAL Palo Alto residents.

When do we start collecting signatures?


Posted by Depressed, a resident of Adobe-Meadows
on Mar 29, 2012 at 8:36 pm

Carlito:

Good luck... Unions control the elections here. They buy most of our elected leaders.


Posted by Bart, a resident of Old Palo Alto
on Mar 30, 2012 at 10:20 am

Part of the problem of huge, unaffordable city salaries and benefits is conflict of interest. The administrators who negotiate wimpily with the unions get the same kinds of benefits (with more money), so they are not going to be sensible and responsible and tell the unions to accept 401(k)s and pay for their own retirement medical care. We need some sort of outside negotiators who can produce a balanced budget, and then we taxpayers (including "hidden" taxes in utility bills), can get something for our money.


Posted by Michael, a resident of Crescent Park
on Mar 30, 2012 at 12:35 pm

I took a look at the city charter and found a few interesting items that may be of interest.

Palo Alto has just under 36000 registered voters. If 6% (2150) of us sign a petition backing an initiative, the city council must either pass it outright or put it on the ballot during the next election. If 12% sign, the council must either pass outright or call a special election.

Likewise if 12% of the registered voters in PA sign a petition, the city must hold a recall election. I imagine a public fed up with the level of incompetence in city government could get Price and a few of the other council members who have been bought by the unions out of office.

I can't imagine 2200 Palo Altans couldn't be mustered to get behind an initiative that would force the city to operate more responsibly; cap municipal salaries (no more $100K street sweepers), require open bidding for services, switch all pensions to 401k, etc.

I'd rather give up several evenings and weekends collecting signatures than watch the city government try to raise our taxes so they can continue handing everything over to their union benefactors.


Posted by pat, a resident of Midtown
on Mar 30, 2012 at 1:42 pm

Here's another way the city spends our money: The Magic Bridge.
A group is building a playground for the handicapped in Mitchell Park on the south side of Adobe Creek. Good idea, right? BUT…

The playground have more than handicapped swings and slides. There's a proposal to build a theatre stage with seating for an audience (I guess the Children's Theatre and the Paly Theatre and the Lucy Stern just aren't enough for a city as cultured as Palo Alto!), and possibly a refreshment stand.

Two new bridges will have to be built over Adobe Creek; one for wheelchairs and the handicapped which will have to comply with the ADA, the other for elementary children on bicycles. The existing bridge will be removed.

All the pathways leading from the Mitchell Park parking lot will have to be resurfaced to allow for motorized wheelchairs.

This group claims they will raise enough money over the next year to pay for all this plus the playground equipment. Meanwhile, the City has already given them $208,000 for the design work.

How much more do you think we'll spend on this?


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Mar 30, 2012 at 2:21 pm

Good example Pat from Midtown. And believe me, no one is saying that we should never fund or develop a facility such as this. I truly believe it is an admirable pursuit. But can we please hold off on these type of projects until we figure out how to pay for our vital infrastructure and public safety needs first. Without our basic infrastructure and public safety in place, it truly diminishes anything else we do. Let's set some financial priorities and stick to them.


Posted by college terrace resident, a resident of College Terrace
on Mar 30, 2012 at 7:37 pm

Very interesting finding about City Charter. Shall we form a work group to try to get Palo Alto Citizens Revolt going for real?


Posted by Douglas Moran, a resident of Barron Park
on Mar 30, 2012 at 8:21 pm

Douglas Moran is a registered user.

RE: Depressed: "...Unions control the elections here..."

Actually, if anyone controls elections, it is the Palo Alto Weekly through its endorsements. First, there is a very strong _correspondence_ between the PAW endorsements and who wins.

There is also a strong _causal_ relationship. I have been actively involved in the candidate questionnaire and forum sponsored by PAN (Palo Alto Neighborhoods) for at least 3 election cycles. After these cycles, I have pushed out a survey asking what information sources people used and what they found most helpful. The PAW endorsements and the candidate statements in the Voters Guide were the overwhelming factors. Everything else paled in comparison (other newspapers, organizational endorsements,...). And recognized that the self-selected respondents to this survey were those most like to be seeking out other info.


Posted by Volunteer, a resident of Charleston Gardens
on Mar 30, 2012 at 9:25 pm

I'll join any work group to take back our government. The waste is staggering and I don't want to hand the mess to my children.


Posted by Guest, a resident of Another Palo Alto neighborhood
on Mar 31, 2012 at 12:25 pm

I've been here for over 20 years, but recently I've given up the feeling that PA is a university hometown.

It's a boomtown. Get in for work, suffer the leeches while working, then leave to go elsewhere with a hoard. Sad, but this is more and more the truth.


Posted by Grandma, a resident of Charleston Gardens
on Mar 31, 2012 at 5:32 pm

The City will be receiving $23 Million from Stanford for mitigation impacts of building the new Stanford hospital. But, I suppose this isn't enough!!!

With this kind of money coming in I certainly won't be voting the City anymore tax increases. They are unbelievably irresponsible when it comes to handling money; they just fritter it away on things the City can do without. Now they want to buy the old Post Office building on Hanover - what next!!!!

This $23 Million from Stanford should go directly into the infrastructure fund






Posted by lazlo, a resident of Old Palo Alto
on Apr 1, 2012 at 5:08 pm

Why not use the millions of tax dollars that Keene and Klein have hoarded away in dozens of "reserve" funds. I am sure the Stanford grant of $23 million will end up in yet another "reserve" fund or maybe they'll use it to build their visionary auto row on East Emabarcadero, meanwhile, suckering taxpayers into believing that the city is cash poor and needs to raise taxes and fees. The reserve funds were collected to complete specific projects, including infrastructure projects, yet the city continues to hoard away millions of our tax dollars.


Posted by Raphael, a resident of Professorville
on Apr 1, 2012 at 9:16 pm

Need more money...start with reducing the pensions and salaries of the city employees.


Posted by Douglas Moran, a resident of Barron Park
on Apr 2, 2012 at 12:27 am

Douglas Moran is a registered user.

It is a huge mistake to regard the Stanford $23M as "free" or "found" money (eg a grant). The project is going to impose huge costs on Palo Alto as a result of the additional traffic and housing requirements. That money should be regarded as in escrow for those future requirements.


Posted by Voter, a resident of Green Acres
on Apr 2, 2012 at 8:58 am

I opened the link in the first comment and am astounded. The salaries the city is paying its own employees is probably double what it needs to be in some cases. Why are admins making close to 100K in City Hall?

With the amount of revenue this city brings in, we should have first class infrastructure and services. We have neither, and the city is still crying poor.

Given that the current city govt. has shown itself unable to lead with anything remotely approaching efficiency (IE, unable to engorge itself on the taxpayer trough), we should be pushing to have all services outsourced (except police as mentioned by someone above) to the private sector, where competition dictates that value for the tax dollar will be delivered.

Definitely voting no on any tax increase. They can try to keep backdooring tax increases through raising utility rates, but that can only go so far before triggering a full-fledged voter rebellion, especially now that the huge salaries and benefits that the city pays its own is becoming more public knowledge.


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Apr 2, 2012 at 10:06 am

What bothers me the most Voter, in addition to the points you made, is the years of spending on non-essential programs and services, as well as catering to these special interest groups. All at the expense and detriment of overdue and vital public safety and infrastructure needs. Our city leaders and elected officials fail to address the important civic work that needs to be done, and when it begins to reach the breaking point, they return to the tax payers and ask for more money. All for work that should have already been planned, completed, and paid for. Absolutely unreal.

What did they think was going to happen? I'll tell you what. Our city leaders need to make cuts and sacrifices wherever possible and find a way to pay for these essential needs without another bond measure and tax increase. I for one do not want to let them off the hook. At some point the public trough has to run dry before they get the idea apparently. Once our essential public safety and infrastructure needs are met, then all of these special interest groups and niche programs can promote their own bond measures to determine if a majority of our citizens wish to pick up their tab. It should never have been the other way around. That's one of the primary reasons we're in this financial mess.


Posted by Civitas, a resident of Another Palo Alto neighborhood
on Apr 2, 2012 at 2:02 pm

There has been progress under Jim Keene to clean out City Hall. Still more needs to be done so that past scandals, cronyism, incompetence do not recur. How many top managers from the prior administration have been booted, left before they were kicked out, or not promoted under Keene's watch? These now-departed people were all playing games, not doing honest work, in the City Manager's Office, Human Resources Department, the City Attorney's Office, the Administrative Services Department, and elsewhere. A good start, but he needs to finish the job. Then ask the taxpayers for more money.


Posted by In Balance, a resident of Another Palo Alto neighborhood
on Apr 4, 2012 at 10:42 am

Things just aren't in balance. Palo Alto really does need some of these repairs, and the longer they hold off the more expensive it gets...think replacing your roof before water damage. City employees need to be compensated fairly, libraries need to be funded, taxes need to be fair. The problem is everything's out of balance. Maybe one way to increase city revenues is to not bog down every project in red tape? There are plenty of projects in the works that just need permits that would generate tax dollars and jobs. Example? Quit holding up the hotel project at the old bowling alley. Do we all really want to drive by that eye sore?


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