Faced with a potential annual deficit of nearly $20 million and eventual bankruptcy, the Westminster City Council will convene in a special meeting on Monday at 7 p.m.
The two items on the agenda – both deferred from the March 9 meeting – are an update on Measure SS, the one-cent sales tax approved by voters in 2016, and a presentation on the impacts on the city if the tax is not renewed.
Measure SS, passed in the face of massive layoffs in the aftermath of the Great Recession, has a six-year “sunset” clause, meaning that in order for it to remain in effect, voters must give approval again.
According to the report supplied to the council, if the tax is allowed to lapse, the city will be $10.5 million in the red for the 2022-23 fiscal year, with the gap plugged by the use of reserves. However, by 2024-25, the city would have exhausted its reserves and would have a negative balance of $7 million in that “rainy day fund.”
The council could act to put the sales tax measure on the ballot for the Nov. 8 general election, but – even if approved – the city would have to forgo millions in revenue because the tax wouldn’t start to show benefits until April 2023.
Several efforts to put Measure SS – or a similar tax levy – before voters have failed before a divided council. In August 2020, a proposal to place a 1.5-cent sales tax fell short of making the ballot
Four “yes” votes were needed. Three voted in favor, but Mayor Tri Ta abstained and Councilmember Tai Do voted “no.”
The council will meeting will be held in a web conference/teleconference format.