The City of Palm Springs City Council made a significant decision on July 9 that will significantly impact its financial landscape for years to come. The City Council approved a resolution to place a measure on the November 5, 2024, general municipal election ballot that would extend the term of Measure J, a one percent (1%) general transactions and use tax, indefinitely.
Measure J, a cornerstone of the city’s revenue since its inception, is currently set to sunset on March 31, 2037. However, the proposed ballot measure seeks to remove this sunset clause, thereby ensuring continued funding for various city services and infrastructure projects.
Background on Measure J
Measure J was originally passed by Palm Springs voters on November 8, 2011, and became effective on April 1, 2012. The measure imposed a one percent (1%) sales tax that could be used for any general purpose. Historically, the city has utilized these funds to finance significant infrastructure improvements and community projects.
The funds have supported a wide range of major projects, including $45 million to stimulate the comprehensive downtown revitalization project initiated in 2014, which has yielded extremely positive commercial redevelopment and economic impacts. Some of the other notable projects funded by Measure J include downtown park enhancements, the renovation of the Plaza Theatre, street repairs, and various park improvements, including playground equipment and shade structures.
Financial Impact and Future Projects
Measure J has been a significant revenue generator, contributing approximately $22 million annually to the city’s coffers. In recent years, this has comprised roughly 10% of the city’s annual revenue. Since its inception, the tax has raised more than $180 million for the city.
An independent commission of Palm Springs residents oversees Measure J spending with annual audit oversight of the expenditures, demonstrating the city’s commitment to transparency. There is an online portal that provides details regarding all Measure J projects. You can find that information here.
These funds have been crucial in supporting general city services and enabling numerous infrastructure projects. Looking ahead, the city plans to use Measure J funds for future projects such as remodeling the city’s main library and constructing a new Fire Station #1.
Without the extension of Measure J, the city faces the prospect of losing this critical revenue stream starting in 2037. If the measure is approved by voters, the sales tax will continue indefinitely until repealed by a future vote.
Technical Updates and Compliance
In addition to extending the term of Measure J, the proposed measure includes several technical updates to the sales tax ordinance. The California Department of Tax and Fee Administration (CDTFA) requires these updates to align with the most modern terminology and administrative procedures. The CDTFA collects, processes, and remits sales taxes to counties, cities, and other local agencies.
The Ballot Measure Process
Under state law, extending the term of an existing tax is considered a tax increase. Consequently, the City Council does not have the authority to extend or increase the tax on its own; it can only place the measure on the ballot for voter consideration. To proceed, the City Council needed to support the measure by a two-thirds vote which they did by approving the ballot measure resolution unanimously.
The following is the ballot measure language approved by the City Council:
CITY OF PALM SPRINGS SALES TAX EXTENSION MEASURE
To continue funding for general City services such as expanding police and fire services, maintaining and improving streets, parks, and infrastructure, supporting community non-profit organizations, and improving the City library, shall the measure maintaining the Measure J City sales tax at a 1% rate and extending its term by repealing its March 31, 2037 expiration date/sunset, generating approximately $22,000,000 annually until ended by voters, be adopted?”
Voters can vote “YES” to approve the measure or “NO” to reject it. To pass, the Measure will require a YES vote by 50% plus one of the total votes.
Strategic Importance and Community Impact
The extension of Measure J is closely aligned with the City Council’s strategic priorities, particularly in community infrastructure. The ongoing revenue from this sales tax is vital for the city to continue providing high-quality services and maintaining its infrastructure. This measure supports the city’s immediate needs and ensures long-term financial stability and the ability to undertake large-scale projects that benefit the entire community.
As the resolution for the ballot measure has been discussed in recent months, city council members have expressed their strong support for Measure J.
Mayor Jeffrey Bernstein highlighted Measure J’s impact on Palm Springs since its inception. He pointed out that the funds generated by this measure have been instrumental in upgrading the city’s infrastructure, renovating historic landmarks like the Plaza Theatre, and supporting vital community services. “Measure J has been a cornerstone of our city’s development and prosperity,” Bernstein noted. “Extending it is essential to ensure we can continue to provide top-notch services and maintain the quality of life that our residents have come to expect.”
Council Member Lisa Middleton underscored the importance of the sales tax in enabling the city to plan and execute long-term projects, such as the proposed remodeling of the main library and the construction of a new fire station. She emphasized the fiscal responsibility the council has shown in managing Measure J funds and the need to secure these resources for future generations. “The extension of Measure J is not just about maintaining the status quo; it’s about building a sustainable future for Palm Springs. This measure allows us to invest in critical infrastructure and services that will benefit our community for decades to come.”
Council Member Christy Holstege focused on the community-driven nature of many projects funded by Measure J. She noted that the Community Initiated Projects program leverages Measure J funds and has empowered residents to propose and implement projects that directly improve their neighborhoods. Holstege said, “Measure J has given our community a voice in shaping their environment. Extending this measure will ensure that residents continue to have the opportunity to initiate and see through projects that matter most to them.”
Public and Administrative Considerations
The resolution also includes provisions for consolidating the general municipal election with the statewide general election to be held on November 5, 2024. This consolidation aims to streamline the electoral process and ensure higher voter turnout. Additionally, the resolution sets the deadlines and rules for filing primary and rebuttal arguments regarding the measure, ensuring a transparent and organized process for public debate.
Potential Challenges and Community Response
As with any tax measure, the community has potential challenges and diverse opinions. Some residents may be concerned about the indefinite extension of the sales tax and its impact on their cost of living. Others, however, may see the extension as necessary to maintain the city’s quality of life and support its growth and development.
City officials have emphasized Measure J’s importance in funding essential services and projects that directly benefit the community. They argue that without this revenue, the city would face significant financial challenges that could affect its ability to provide critical services and maintain its infrastructure.
