The City of King is making significant financial progress. The last two budgets have been balanced and the General Fund debt has been decreased from almost $5 million to $2.5 million in just two years. Meanwhile, new efforts to address important needs have been funded.
However, progress has been largely made using one-time revenue sources, which means basic ongoing operational revenues and expenditures are still out of balance. Future revenue projections also rely heavily on funding anticipated from the cannabis tax, which involves a number of uncertainties. Therefore, it is recommended to avoid becoming overly dependent on this one revenue source in order to establish long-term financial stability.
To accomplish this, the City is studying the potential of placing a measure on the ballot to increase the sales tax by 1/2 cent at the next general election. It would generate the revenue amount needed, and every other city in Monterey County except one currently has a local sales tax two to three times or more than King City’s rate. Since businesses along Highway 101 are the City’s highest sales tax producers, a large portion of this tax is not paid by residents.
The City Council reviewed this information and provided preliminary direction at its April 24th meeting. A copy of the staff report is attached. The City Council will have continued discussion at the May 8th meeting and the public is welcome to provide input. Council meetings begin at 6:00 p.m. at City Hall, 212 S. Vanderhurst Avenue. You may also contact City Hall at 385-3281 if you have questions or comments.