Los Gatos Weekly-Times

Monte Sereno may lower assessment for policing

By Clarence Cromwell

Although the cost of police services is expected to rise slightly next year, the Monte Sereno City Council may decide to reduce by $26 the law-enforcement assessment residents pay. First, though, they want to make sure they can raise the fee later if necessary.

Councilmembers postponed at the May 21 budget session the otherwise routine adoption of Monte Sereno's no-cuts $1 million budget while they mull the tax cut. They'll reconsider the budget and the proposed tax cut in two weeks.

Councilmembers Jack Lucas and Suzanne Jackson thought of the tax reduction at a budget update session with the city manager, Lucas said.

"When we saw what we were putting into our reserve account, we looked at each other and said, 'Isn't there some way we can reduce the parcel tax that our citizens have been paying?'" Lucas recalled.

Other council members supported the tax cut on the basis that the city is better off than it was two decades ago, when the assessment was enacted to help keep the city solvent. Monte Sereno voters at that time gave the city power to assess as much as $150 per parcel for law enforcement.

"We just don't need it," Councilmember Jack Lucas said.

The current fee of $121.50 per parcel, added to yearly property taxes, isn't enough to cover the entire bill for patrol from the Los Gatos Police Department.

Nevertheless, assessment bills would drop from $121 to $95 under the proposal discussed May 21. A tax break that size would cost the city about $30,000 the first year.

The city would make up for the loss by reducing a deposit to its reserve funds to $109,000. City policy is to deposit $90,000 each year, so the emergency reserve will keep pace with inflation.

The reserves are far larger than required; they contain nearly enough money to run the city for three years.

Most cities keep only a small percentage of their budgets in reserve, said City Manager Carolyn Lehr, but Monte Sereno's six-figure budget is so small by comparison that sufficient emergency reserves outsize the yearly expenditures.

Lehr added that savings of switching law-enforcement agencies from the Santa Clara County Sheriff's Department to Los Gatos police made the tax cut possible. The LGPD charges about $25,000 per year less than the sheriff, Lehr explained.

Before handing the gift to taxpayers, however, the council asked the city attorney to research whether it can raise the tax again later, should it be needed to balance the budget.

"We would want to have a firm commitment that we still hold the reins," Lucas said.

Councilmembers fear that Proposition 62, a recent ballot measure that closed many loopholes in Proposition 13's tax-cutting powers, would require a two-thirds vote of any increase in the law-enforcement assessment.

But neither they nor city staff were yet sure whether the newer law would apply.

Council members agreed that if the assessment isn't lowered, they should find some other way to return some money to residents.

But Lilian Harman, a member of Citizens FOR Monte Sereno, called a tax break a bad idea, saying law enforcement costs are bound to increase in future years. Citizens FOR Monte Sereno in the past has accused city officials of building up a free-spending fiscal bureaucracy.

Harman speculated that Monte Sereno residents would be angered if the tax cut were later followed by an increase of the same tax.

Lucas disagreed.

"My readout is that a large majority would be happy to see that tax reduced," Lucas said. "It's also sending a message to the community that we're not trying to build a financial bureaucracy here."

But if residents want to pay the higher tax anyway, they can write the city a check for $26, Lucas joked.

The city's $973,699 operating budget includes a $10,000 raise for the city attorney and a $75,000 salary for the soon-to-be-hired city manager. Lehr, the current city manager, plans to move to New Jersey with her family as soon as her replacement can be hired.

The $317,535 capital improvement budget allows $75,000 for street repairs.

Lehr said taxpayers can call City Hall between 9 a.m. and 5 p.m. at 354-7635 with opinions about the tax reduction. They could also attend the next council session, where the tax is likely to discussed. The meeting is set for 7:30 p.m. June 4 at City Hall.