More than half the City of Pismo Beach’s budget comes from tourism-related revenue like sales tax from popular shopping centers like the Pismo Premium Outlet mall.
“I think the tax is pretty high compared to a lot of places”, says local shopper Dawn Kalina.
Pismo Beach voters previously approved a half-percent sales tax increase to bring it to its current level of eight percent.
The City Council has voted to extend that increase for another 12 years and is asking voters in November to agree.
“We weren't sure how long we could make it for”, says Pismo Beach City Councilmember Ed Waage, “we wanted to have a sunset clause but we wanted to be able to float a bond using this money and you need about ten or 12 years to float a bond.”
Waage says the city has millions of dollars in unfinished infrastructure improvement projects.
“Even though we are doing really well, we still don't have adequate funds for all the work we need to do”, Waage says, “when I first got on the City Council we identified about $21 million worth of improvements needed, we're not done yet, we need to finish the job, there's an awful lot of infrastructure improvements, the roads especially, and we need additional revenue in order to complete the job, we've done a lot of work already but we're not done yet.”
Waage says rolling back the sales tax to 7.5% could mean $1.7 million dollars a year in lost revenue for the city.
“I don't like higher taxes myself”, Waage says, “however 100 percent of this tax goes to our infrastructure improvement, not one dime for salaries, or benefits or anything else, all of it goes for improvements and that's why I'm for it.”
Waage says 70 percent of sales tax revenue is paid by tourists with city residents reaping all of the benefits.
A fact not lost on tourists Central Coast News spoke with.
“Of course all of the cities seem to be spending more than they have, employees, benefits, retirement packages”, says tourist Jim Thomas who’s visiting Pismo Beach from Visalia, “the threat is the reduction of city services, or brownouts for the fire departments or they're not going to hire new police officers, so there's reduced police presence, so they scare the voters into voting and voting for what they want.”
“I used to live in New York or New Jersey and go shopping there and there was no sales tax, that was incredible, those days are long gone”, says Jeanine Heil who’s visiting from Palm Springs, “in my mind we all have to share the burden.”
“I think we ought to reduce taxes”, adds Chuck Heil, “I think when you have tax free zones, New York is doing a lot of that today, it generates a lot more industry, when industry comes in, people come in, housing comes in, employment comes in, people will spend their money, so I think it should be a little bit more different, places like the outlets here, instead of charging 7 ¾’s, why not reduce it to 2 percent, bring more people in here to shop, spend more money, do more things, so I think you create more opportunity by reducing taxes and creating opportunities.”
Atascadero, San Luis Obispo and Guadalupe are among local cities that have sales tax initiatives on the November ballot.