STAFF REPORT - CITY COUNCIL/SUCCESSOR AGENCY/PUBLIC FINANCE AUTHORITY

Staff recommends that the City Council:

• Receive background information regarding Measure J, including prior Council actions, community feedback, and the outcome of the November 2024 election;

• Provide direction regarding whether the Council wishes to further explore placing a Measure J renewal or extension on the November 2026 General Election ballot; and

• Provide direction regarding the potential engagement of a professional consultant to assist the City with the preparation and dissemination of legally permissible, factual public information related to a future ballot measure, should Council wish to proceed.

No formal action is requested at this time unless directed by Council.

In November 2018, the voters of the City of Coalinga approved a one-percent (1%) transactions and use (sales) tax, commonly referred to as Measure J, to fund City services including police and fire protection and other general municipal services. The tax became effective on April 1, 2019, and includes a sunset date of April 1, 2029.

At the time of adoption, the City Council approved a Declaration of Intent outlining key expenditure priorities for Measure J revenues, including enhanced public safety staffing, emergency preparedness investments, employee recruitment and retention, and the establishment of financial reserves. Over the life of the measure, these priorities have been substantially implemented or addressed through variations responsive to operational needs.

Measure J revenues currently represent a significant portion of the City’s General Fund and support core municipal operations.

Prior Council Direction and 2024 Election Efforts

Between 2022 and 2024, the City Council held multiple discussions regarding whether to extend or remove the sunset date for Measure J. In 2024, Council considered two primary options:

• Extending the existing tax with a new ten-year sunset date; or
• Removing the sunset date entirely.

In preparation for those discussions, the City conducted a community survey to gauge public sentiment. While responses reflected a range of opinions, results generally indicated greater support for an extension with a defined sunset than for removal of the sunset entirely, alongside requests for continued investment in public safety, infrastructure, and community quality-of-life services.

Following those discussions, Council ultimately placed a Measure J item on the November 2024 ballot. Unfortunately, the measure did not receive sufficient voter support to pass.

Purpose of This Discussion

This staff report is intended to initiate early, policy-level discussion regarding whether the City Council wishes to revisit Measure J for possible placement on the November 2026 General Election ballot, allowing sufficient time for deliberation, community engagement, and careful planning.

No recommendation is being made at this time regarding the specific structure, duration, or ballot language of any future measure. Rather, staff seeks Council input on whether further exploration is desired.

Fiscal and Operational Considerations

If Measure J were to sunset as scheduled on April 1, 2029, the City would experience a substantial reduction in General Fund revenues. Based on recent fiscal data, the loss of this revenue would have a material and potentially severe impact on City operations, including public safety, staffing levels, and service delivery.

Public Information and Legal Considerations

Should the Council wish to pursue a future ballot measure, it is important to distinguish between advocacy, which is prohibited using public resources, and factual public information, which is permitted under California law.

Cities are allowed to provide neutral, factual information to help voters understand:

• What a measure would do;
• How revenues would be used;
• The fiscal implications of approval or rejection; and
• The current state of City finances and services.

However, these communications must be carefully crafted to remain informational and not persuasive.

Potential Consultant Support

Many local agencies retain specialized consultants to assist with legally compliant public information efforts related to ballot measures. Firms can provide services that may include:

• Development of fact-based fiscal impact summaries;
• Preparation of objective revenue and expenditure analyses;
• Community education materials focused on existing conditions and future scenarios;
• Assistance with survey research or voter opinion analysis (if desired); and
• Guidance to ensure compliance with state law governing public communications.
• Engaging a consultant does not commit the City to placing a measure on the ballot, but can provide professional support should Council wish to better understand community sentiment and ensure accurate, transparent information is available to the public.

Staff is seeking Council direction on whether exploring such services would be appropriate if discussions move forward.

There is no immediate fiscal impact associated with receiving this report or providing policy direction.

Future costs may be associated with consultant services, community outreach, or election administration if Council elects to proceed further. Any such costs would be brought back to Council for consideration and approval prior to expenditure.