Running out of options, what new tax could Oakland ask voters to approve?

"Crucially, city leaders have already claimed the revenue in next year's budget. And while they are likely to promise voters that the tax would fund public safety, IT systems and 911 operations, in reality the money could be spent at the City Council's discretion. Trickier for the city is that the options for pursuing a new tax appear limited. Oakland has effectively maxed out its ability to tax sales, while longstanding state law limits new property tax increases."

"So the city may instead propose a new tax on land parcels, charging owners of single-family homes an additional $224 annually, or about 20% more than the existing rate, which stands at $1,102, per a city report. Oakland could also seek a "blend," mixing a parcel tax with a levy on some smaller city service, such as parking. If placed on the June 2026 ballot, the measure would require two-thirds approval."

""Taken alone, none of these options are palatable for us," Councilmember Janani Ramachandran said about the menu of tax options presented Tuesday at a council committee meeting."

Oakland faces a persistent budget gap and may ask voters in June 2026 to approve a new tax expected to raise $40 million annually. City officials have already allocated the projected revenue in the next budget. Promises to target public safety, IT, and 911 could give way to discretionary spending by the City Council. Revenue options are constrained: sales tax capacity is nearly exhausted and state law limits property tax increases. Possible proposals include a parcel tax adding about $224 annually for single-family homeowners, or a blended parcel-and-service levy requiring two-thirds voter approval.

Read at The Mercury News