County Tax on Ballot

County Supervisor John Gioia

A proposed new countywide sales tax “to address deep cuts in federal funding” and support critical local services including health care will be Measure B on the June 2 ballot. Voter approval of Measure B would also “reduce the risk of closures at Contra Costa’s regional hospital and health clinics,” according to the ballot language for the measure.

These cuts are mostly due to the federal legislation sometimes called the One Big Beautiful Bill and other changes in federal healthcare policy which dramatically affect Medi-Cal funding and food assistance.

Sales Tax of 0.625% for Five Years

The tax of five-eighths of one cent (0.625%) would last for five years. For some local jurisdictions, it would bring the sales tax rate to more than 10%. In El Cerrito, the current sales tax rate is 10.25%. If the proposed county tax passes, El Cerrito’s sales tax rate would rise to 10.875%.

Supervisor John Gioia answered questions about the measure on March 18.

Gioia acknowledged that sales tax rates would rise to 10% or more in many local jurisdictions, but said the temporary boost in county funding is urgently needed.

Federal Cuts to ‘Vital Services’

“I am always concerned when tax rates increase,” Gioia said. “In this case, I believe that a temporary five-year sales tax is needed to significantly lessen the harm resulting from up to 90,000 Contra Costa residents losing health insurance and up to 18,000 Contra Costans losing vital food assistance benefits.”

Gioia added that all residents are affected when tens of thousands of residents lose health insurance because “losing health coverage means people are not getting regular medical care and are delaying their care, getting sicker and going to emergency rooms to get their care.”

Effects on All Residents

“Increased emergency room visits increase ER waiting times and ambulance response transport times for everyone, not just those losing their healthcare,” Gioia said. “Residents who lose health coverage and/or food assistance would be forced to potentially pay hundreds of dollars per month more for medical care and food, and would increase the county’s costs (which are borne by property tax payers) to provide legally required medical care to those who lose Medi-Cal coverage. These costs would be in the millions per year.”

Change in State Law Needed

An amendment to state law is required to allow the proposed 5/8 cent tax to be levied in those cities that have already reached the state sales tax cap. The cap for local district sales taxes is 2% above the state base rate of 7.25%. A bill is needed when the total sales tax will exceed 9.25%.

“There have been previous bills to raise this 2% cap and the county is seeking one,” Gioia said.

Taxpayers Association Opposes the Tax

The Contra Costa Taxpayers Association opposes the tax, saying: “Despite being shown evidence that the ‘deep cuts in federal funding’ were far less than stated, four supervisors pushed through an unnecessarily large increase which will push total sales tax rates to 10% or more around much of the county.”

County Report on Budget Impacts

Gioia said the tax is needed and gave a link to a report with more details on budget impacts. https://www.contracosta.ca.gov/10560/HR-1-Impacts?PREVIEW=YES

He provided a chart showing the existing sales tax rates of the 19 cities in Contra Costa plus our unincorporated areas (like Kensington, El Sobrante, Tara Hills, North Richmond, East Richmond Heights, etc.).

Legislators Support Raising the Cap

Gioia wrote, “Our local legislative delegation is pursuing a bill to raise the sales tax cap in the County to allow the County to levy the additional 5/8 cent sales tax, if passed. Even though the cap does not need to be raised in each city, their bill will enable our tax to be levied in any jurisdiction where the sales tax cap needs to be raised.”

Why 5/8 of a Cent?

Gioia said the board was following the lead of Santa Clara County, which also runs a county health care system and is facing severe cutbacks from federal cuts.

Voters there recently approved a temporary five-year sales tax of 5/8 cent.

Gioia said a 5/8-cent sales tax will bring in about $150 million per year, while a ½ cent sales tax would raise about $120 million year. The smaller tax “would not cover as many of the cuts which will occur,” he said.

“The funds collected will go into the general fund (as all sales tax and property tax revenue does) and will be used as described in the approved ballot language for the measure (Measure B),” Gioia wrote.

Here is the language that will appear on the June 2 ballot.

Measure B Ballot Language

MEASURE B

Contra Costa County Transactions and Use Tax

Majority Required to pass

To help Contra Costa County address deep cuts in federal funding; support critical local services such as health care, supplemental food assistance, and other general county services; and reduce the risk of closures at Contra Costa’s regional hospital and health clinics, shall Contra Costa County adopt a five-eighths of one cent temporary general sales tax for 5 years, providing an estimated $150,000,000 annually, not available to the federal government and subject to annual audits and independent citizens oversight?