Westminster residents have overwhelmingly voted to keep a 1% tax increase on their purchases in town for another 20 years – a move that could prevent financial calamity at city hall.
That means residents get to hold onto their public parks and community centers, as well as services like overgrown weed abatement, after an expiration of the tax threatened to blow a hole through the city budget and bankrupt the heart of Orange County’s Little Saigon by 2024.
It was a hard-fought battle, with opposition from the likes of the OC Taxpayers Association, and, for a time, enough city council members to delay voters’ decision on the measure for two years.
While some have voiced relief that the tax measure will stay, others wonder what the new council will do with what some consider the lucky break they’ve been given.
Critics of the tax measure argued it was a way for the city to pass the consequences of their fiscal mistakes onto the public.
And some are already scrutinizing the city’s spending choices in light of the election.
For one thing, the outgoing City Council last month agreed to fund the annual Little Saigon Tet Parade in February out of the taxpayer budget for the first time in 10 years, after no private organizers stepped forward this year to run it.
The Nov. 30 council vote in support was unanimous, with some members weighing the city’s ongoing shaky finances against what they considered the public shame in not running what’s become an iconic parade.
“People come here, they want to see a Tet Parade at Tet. This is what they expect,” said City Councilmember Kimberly Ho during the discussion. “This is all we have. We don’t have Disneyland.”
The city normally spends money to support the event through city staff and police for crowd control.
But to run the event entirely will cost City Hall roughly $150,000.
City watchdog and activist Terry Rains’ advice was to “skip it this year.”
“First thing out of the gate, they propose to pay for the Tet parade at double the cost,” Rains said in a Thursday phone interview.
But the Lunar New Year is an event of major significance to a demographic in town that drives much of the local economy, and city staff say they’ve been getting questions from local community groups and school districts – for whom the event is a prized opportunity to showcase their activities – about whether there will be one in two months.
“The Tet Parade itself, however, has become the elephant in the room. And in some cases, the literal elephant in the room,” said City Manager Christine Cordon at the Nov. 30 meeting.
To run the event would require a significant “frontload” of funds, she added.
“The budget right now doesn’t support the Tet Parade,” Cordon said.
Because the sales tax measure passed this year – not in 2020, as staff pushed for – the city will lose out on a quarter of revenue until March, which they estimate to be $4.2 million, according to official projections.
And while bankruptcy seems to have been staved off, the city will still have to find other ways of climbing out of a continuing structural deficit.
Banking on voters was just the first step, Rains said.
After all, the state collects the sales tax money first, so it will be some time before the city gets it back.
“As far as next steps — it draws back to who’s in charge,” Rains said.
Cordon said the city might have to eat some money to fund the Tet Parade.
“Can I guarantee that it’s a full cost recovery? You can never guarantee that with special events,” said Cordon during last month’s parade discussion.
“It is just a risk you have to take.”
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