May 23, 2024 at Portola Valley Community Hall in Town Center. Photo by Anna Hoch-Kenney.
The Portola Valley Finance Committee met on October 15th to discuss short-term and long-term steps the town can take to relieve pressure from the current fiscal crisis. In preparation for the Oct. 23 Town Council meeting, the committee has compiled a list of the pros and cons of various approaches for the council to consider.
During the Finance Committee meeting, committee members proposed charging housing element costs to the Affordable Housing Fund and charging open space maintenance to the Open Space Fund for short-term opportunities. Long-term opportunities include private financing, renegotiating the contract with the San Mateo County Sheriff’s Office, and renegotiating property taxes with the county.
The town council has already been presented with three options at a meeting earlier this month: a 2% user utility charge, a parcel tax, or considering becoming a charter city.
Short-term methods: affordable housing funds, open space funds, UUTs
The Finance Committee emphasized the need to cut services and redirect revenue to create a balanced budget. The short-term opportunity would help the town’s finances for about three to 12 months until the long-term method takes effect.
Finance Committee Chairman George Savage discussed the use of the town’s $4.5 million affordable housing fund to offset accumulated housing factor costs. Over the past several years, the town has spent approximately $1.2 million in consultant and attorney fees related to the housing component.
In the town staff report, the commission wrote that this option would double the general fund reserve, but the commission is unsure whether this is “legally appropriate.” .
“I would also like to emphasize that my number one recommendation is that the Affordable Housing Fund, if legally permissible, consider setting back spending related to the housing element. Because all the activities that we need to comply with are related to the construction of affordable housing,” Savage said during his speech. Committee meeting.
Finance Committee member Chris Littler supported Savage’s recommendation with UUT allocating money for open space maintenance from the general fund to the Open Space Fund.
The Open Space Fund currently has $8 million and grows by $400,000 each year. A 2% tax would shift $400,000 of UUT each year. This would “avoid increased general fund maintenance obligations.” Downsides to this include public dissatisfaction with using open space funds for other town expenses, according to the staff report.
long term method
Savage also recommended that the town council fund an attorney to work with San Mateo County to renegotiate the contract with the sheriff’s office and the town’s share of property tax revenue from the county.
The staff report explains that by negotiating with the county on property tax rates, more resident tax dollars can be directed to the town. The county currently pays 7% of Portola Valley’s property tax payments to the county. “The county may have underpaid the town by up to $210,000, the report states.
“Go back and renegotiate all of these long-term service contracts because I think there is some lack of affordability,” Town Council candidate Carter Waugh said in public comment.
The committee also received a new idea from town resident Ronnie Krasinski, who proposed a fundraising campaign as a way to increase revenue.
“If you look at the Portola Valley School Foundation, they raise about $1.2 million a year from 300 families. I think with the right campaign they have the potential to raise a lot of money,” Krasinski said. I spoke at the meeting.
Future discussion
The Town Council is scheduled to discuss these opportunities at the Town Council meeting on Wednesday, October 23rd.
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