On Monday night, right before it begins its summer break, the City Council will debate a proposal that has little definition other than as a tax on all businesses in Palo Alto designed to raise as much as $6 million a year for undefined transportation measures.
It has been the subject of little outreach within the business community, has no clear goals other than to raise money and is not at all ready for either a council decision or the ballot.
Worse, the item appears on the council agenda with no staff report or any supporting data, in violation of the council's policy of releasing such information on important issues at least 10 days prior to the scheduled meeting. The agenda states that a staff report would be available on Thursday, after the Weekly's press deadline, giving the public just three days before the meeting to digest the material.
This is little more than a rushed and desperate attempt to make it appear to the community that the council is addressing traffic congestion problems in anticipation of a highly competitive City Council election, in which only one incumbent (Liz Kniss) will be running and four seats will be open.
"If we don't solve the (traffic) problem," Mayor Pat Burt said in pushing for the ballot measure, "what's going to be the trend line of the political sentiment of the resident community toward the business community and future development?"
Burt is right, but a tax measure is not a solution to the traffic problem, nor should potential further souring of residents' opinions of new development be the motivation for rushing something to the ballot.
Before being asked to approve a new tax on anyone, the community deserves a clearly articulated plan, with specific goals and a budget that reflects the council's priorities for addressing traffic congestion.
Appropriately, the council has over the last few months been exploring various strategies for alleviating our traffic problems, primarily by looking at incentives to reduce single-occupancy-vehicle commuting.
To explore ways of funding these efforts, the council formed an ad hoc Local Transportation Funding Committee, consisting of Burt, Vice Mayor Greg Scharff and Councilwomen Karen Holman and Liz Kniss, which has been meeting over the last few months. Last week the committee muddled through a discussion that surfaced far more questions than answers. But because of the timing for putting a measure on the November ballot, the committee decided to bring to the full council an entirely unshaped plan for discussion.
As it did with the 2014 ballot measure to increase the city's transient-occupancy tax on hotel guests, the council is looking for ways to raise money without taxing the voters themselves — a cynical approach to raising revenue some would argue.
But unlike in 2014, when the measure had been carefully developed with a clear purpose of funding high-priority infrastructure projects, such as a new public-safety building, the current effort is half-baked, lacks any commitment to what the revenues will fund, and fails to detail how it would be implemented.
It is even harder to fathom how the city would even begin to implement a tax based on every Palo Alto business' count of full-time equivalent employees, which they will voluntarily report, when it has had so much trouble implementing the simple $50-per-year business registry.
As contemplated, companies with 10 or fewer employees would pay no tax, 11-50 would pay $50 per employee per year and those with more than 50 employees would pay $100 per employee per year. So a 51-employee company would pay $5,100 per year.
This is exactly the type of tax that businesses were told would not happen when the simple registry was established over a year ago and is reminiscent of 2009, when the council put a poorly drafted business-license tax measure on the ballot that was rejected by 59 percent of the voters.
All the same fairness issues raised then will threaten to sink a new tax measure. How would such a tax be enforced? How would law firms be treated? Medical offices? Venture capital firms? Fast food businesses? Hotels? Restaurants? Real estate companies? What about companies whose workforce is made up of independent contractors or varies dramatically in size? And why should local businesses bear the full burden of funding transportation measures when they benefit the entire community?
We don't foreclose the possible adoption of a tax on businesses to fund certain transit improvements, but a November ballot measure is a non-starter, and we urge the council to quickly dispose of this item from its Monday agenda. A rush to "do something" should not be driving city policy.
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