By Juliet Bennett Rylah
WEST HOLLYWOOD — A proposed three-quarter cent sales tax increase will be decided by local voters Nov. 3 to help fund local services that are in jeopardy because of COVID-19’s impacts on the city’s finances.
The West Hollywood City Council unanimously voted Aug. 3 to put Measure E on the ballot in order to make up for an anticipated loss of $35 million caused by the coronavirus-related economic slowdown. The tax would produce an estimated $11 million annually, making up for actual and projected revenue shortfalls, according to the city’s Community and Legislative Affairs Manager John Leonard.
Addressing concerns that residents would have to shoulder this tax increase, Leonard predicted that up to two-thirds of revenue would come from visitors, as sales tax is not collected on some everyday items, including groceries and medication.
“A lot of the spending that occurs in the city is from tourists and local visitors coming to the city’s hotels, bars, restaurants, and entertainment venues, so these patrons will account for a larger part of the new sales tax revenue as these sectors recover,” he said.
Because West Hollywood generated so much tax revenue as a tourist destination before the pandemic, it may take longer for the city to recover than other areas as the hospitality sector is likely to lag in reopening.
The city has so far used its reserve funds to make up for revenue shortfalls and to avoid cutting back on services, but Leonard said that this is unsustainable and the city might have to cut services if “new revenues, such as Measure E, aren’t realized.”
If approved by voters, the city would designate Measure E funds to disaster preparedness; maintaining HIV and AIDS health services; cleaning and security for public areas; street maintenance; retaining local businesses and jobs; public safety and 911 response; expanding physical and mental health services; homelessness and other services.
The measure would be subject to annual independent financial audits and an annual public review of expenditures.
Local voters also will decide on two City Council seats Nov. 3. The terms of incumbents John Heilman and John Duran are expiring and both are seeking re-election. Nine challengers, including Larry Block, John Erickson, Noemi Torres, Sepi Shyne, Christopher McDonald, Tom Demille, Jerome Cleary, Marco Colantonio and Mark Farhad Yusupov, also are on the ballot.
Juliet Bennett Rylah is a freelance reporter who covers Hollywood and West Hollywood. She can be reached at email@example.com.