The Facts Matter.
FREQUENTLY ASKED QUESTIONS
If Measure Q passes, will Davis’ sales tax be higher than other cities?
Are City of Davis employees paid the same or more compared to neighboring cities?
Does the City have an independent citizen commission review its finances?
What happens when I purchase a car in another city? Where does the Measure Q sales tax go?
What else is the City of Davis doing to make sure we have enough money?
1. WHAT IS MEASURE Q?
Measure Q is a November 2024 ballot measure that proposes to increase the sales tax in Davis by 1%. This means someone would pay an additional 1 cent for each dollar of taxable goods purchased in Davis. Items like groceries and prescription medicine are exempt. Measure Q is estimated to generate approximately $11 million in additional tax revenue per year. Measure Q revenue stays in Davis and cannot be taken by the State.
2. HOW WILL THE MONEY FROM MEASURE Q BE USED?
Measure Q is a general sales tax, which means that it can be used for any city governmental purpose. This includes maintaining public safety and emergency response; addressing aging infrastructure needs; maintaining and improving our roads, bike paths and parks; providing affordable housing support and addressing impacts of homelessness; providing programs to community members of all ages; and taking actions that reduce our greenhouse gas emissions and address climate change.
3. Why does the City need more revenue?
Despite diligent efforts at careful budgeting there is a significant gap between our revenue and what it costs to provide quality city services. For example, construction costs have spiked by 9% in the past year. The City’s utility bills for city-owned property have skyrocketed, increasing by more than $1 million in this past year alone. These increases eat into our city budget, limiting what the city can afford to do with its current resources.
4. What other ways does the City have to raise revenue?
Cities in California have limited options to raise revenue. These include taxes on parcels, utilities, business licenses and hotel stays; fees charged to cover the direct costs of certain services; economic development to increase the tax base; and grants.
5. Is Davis alone in its need for more revenue?
No, Davis is not alone in its need for additional revenue to support critical infrastructure and services. Communities throughout California are facing similar choices between generating additional revenue or making significant service cuts. Every city in Yolo County - and more than 100 cities throughout the state - have similar sales tax measures on the November ballot. This is not an issue that is unique to Davis.
6. WHAT WILL HAPPEN IF MEASURE Q DOESN’T PASS?
The City of Davis has already made significant reductions in its spending and has worked hard to contain costs. The City of Davis is also working hard to promote economic development which will bring in more revenue. But if Measure Q does not pass in November the impacts will be immediate: the city will have to cut staff and reduce city services.
7. If Measure Q passes, will Davis’ sales tax be higher than other cities?
Davis has currently neither the highest nor the lowest sales tax rate in northern California. The lowest is 7.25%, in cities like Auburn or Rocklin. The highest is 10.75%, which is charged by several cities in Alameda County. Approximately 170 cities, or 1/3 of all cities, in California have at least a 9.25% sales tax rate. In Yolo County, the cities of Woodland, West Sacramento and Winters also have sales tax increase measures on the November ballot, seeking approval for 1% sales tax increases.
8. Are City of Davis employees paid the same or more compared to neighboring cities?
The City recently conducted a thorough, independent compensation study that compared employee salaries and benefits to neighboring jurisdictions. The study found that Davis staff salaries were well below regional averages. Through careful management, the City has brought its public employees, including first responders and firefighters, to regional pay parity. Specifically, City staff salaries were brought to the market median - the very middle - among our neighbors. City of Davis employees are not paid more than their counterparts in neighboring jurisdictions, but right in the middle.
9. WHERE IS THE TRANSPARENCY FOR THIS MONEY?
There are several checks and balances on revenues coming to the City and expenditures the City makes. The California Department of Tax and Fee Administration is responsible for passing the correct tax amounts to the City. The City contracts with an independent firm to track, review and audit sales tax to ensure compliance from vendors and follow up on any abnormalities. The City also contracts with an independent auditor to review the City’s annual expenditures to ensure spending is in accordance with all applicable laws and policies, including voter-approved measures.
10. Does the City have an independent citizen commission review its finances?
Yes, the city has a Fiscal Commission made up of Davis residents that advises City Council on financial and budgeting matters. Prior to 2024, the City had a separate “Finance & Budget” commission and “Utility Rate Advisory” commission. Those two commissions merged in early 2024.
11. WHAT HAPPENS WHEN I PURCHASE A CAR IN ANOTHER CITY? WHERE DOES THE MEASURE Q SALES TAX GO?
When you purchase a new car, the sales tax is assessed based on where the car is registered. So if you buy a car in another city, the Measure Q portion of the sales tax still comes back to Davis.
12. WHAT ELSE IS THE CITY OF DAVIS DOING TO MAKE SURE WE HAVE ENOUGH MONEY?
The city understands that no one wants to pay more in sales tax, so this measure is part of a larger effort to increase revenue. The city has worked diligently to trim expenses, even as rising costs and inflation have impacted the city. The city has also recently hired a Director of Economic Development who is taking a very proactive approach to economic development.
13. Will visitors pay the tax?
Yes, this tax would apply to all goods that are used or registered in Davis by both residents and visitors.
14. Do small business owners support Measure Q?
The Davis Downtown Business association was among the first groups to endorse a Yes vote on Measure Q, recognizing that “the investments from Measure Q will directly benefit our local businesses, attract new visitors, and create a safer, more welcoming environment for everyone.”
15. Do Democrats support Measure Q?
Yes, the Democratic Party has officially endorsed a Yes vote on Measure Q. The Republicans oppose it.