BY ELAINE GOODMAN
Each day Put up Correspondent
Ought to town of Palo Alto have the ability to take cash it receives from prospects paying their utility payments and use the funds to pay for different metropolis providers, similar to police or libraries?
That’s a query that Palo Altans will reply once they vote on Measure L on the Nov. eight poll.
Town, which runs its personal utilities, makes use of the cash from buyer payments to cowl the prices of offering the utility service. However the quantity from invoice funds is usually greater than the quantity town must cowl its prices.
So town transfers among the surplus into town’s normal fund, which pays for issues similar to roads, parks, libraries, and the police and hearth departments.
Town has been doing this for years. Within the case of town’s pure fuel utility, about $7 million is transferred every year to the final fund to pay for the opposite providers.
However a lawsuit filed in opposition to town in 2016 has referred to as the observe into query. Palo Alto resident Miriam Inexperienced sued town, saying that town was charging an unlawful tax by its utility payments as a result of it was accumulating greater than the price to supply the utility service. Town would wish voter approval to gather the extra funds, the lawsuit claimed.
The lawsuit, which grew to become a class-action case, produced two outcomes. A Santa Clara County Superior Courtroom choose ordered town to refund $12.6 million to pure fuel prospects whom the court docket stated had been overcharged.
The 2 sides took the choice to California’s Sixth District Courtroom of Attraction. However final month, they reached a settlement wherein town pays $17.three million to pure fuel prospects and Inexperienced’s legal professionals.
The second results of the Inexperienced case is that town positioned Measure L on the poll to see whether or not voters approve of transferring funds from the pure fuel utility to the final fund to pay for normal metropolis providers.
The measure would approve town’s switch to the final fund of as much as 18% of its pure fuel utility income, beginning in 2023. This measure wants majority approval from voters to go.
If voters reject Measure L, the final fund will now not obtain the roughly $7 million a yr from the pure fuel utility.
“If this measure will not be authorized, town will lose a key funding supply for primary providers and reductions can be required,” proponents stated of their argument in favor of Measure L.
As well as, as a result of town’s pure fuel charges already embrace the price of the switch, approval of Measure L gained’t enhance fuel payments, supporters stated.
Measure L opponents stated mixing funds collected for 2 totally different functions is a nasty observe.
“Though it is a long-standing observe within the case of fuel service in Palo Alto, that doesn’t make it a good suggestion,” opponents stated of their poll argument in opposition to Measure L. The opposition poll argument was signed by Joe Dehn, chair of the Libertarian Social gathering of Santa Clara County, and Palo Alto resident Alan Kaiser.
Town has argued that voters authorized the switch of utility cash to the final fund in 1950. As well as, the switch is a method for town to get a return on its funding into the utility system, town stated.
In his resolution in Miriam Inexperienced’s case, Superior Courtroom Decide Brian Walsh wasn’t satisfied by these arguments. Town has raised its utility charges a number of occasions since Proposition 26 handed in California in 2010, he famous. Prop 26 says that if a authorities charge is greater than the quantity wanted to cowl affordable prices of the federal government service, that charge is definitely a tax, requiring voter approval.
“To the extent the GFT (Palo Alto’s normal fund switch) is handed on to ratepayers, it’s a tax,” Walsh wrote in his resolution.
A Committee in Assist of Measure L has raised $6,514 and spent $1,265, in line with a marketing campaign finance doc filed with town of Palo Alto. The submitting covers exercise by Sept. 24.
Amongst those that contributed to the Measure L marketing campaign are council members Eric Filseth, who gave $500, and Alison Cormack, who donated $515.
Lisa Forssell, a member of town’s Utilities Advisory Fee who’s operating for Metropolis Council, donated $258 to assist Measure L.
Metropolis information present that no committee has been fashioned to oppose Measure L.
