PACIFIC GROVE — The town of Pacific Grove has contacted exterior counsel specializing in municipal regulation within the ongoing situation of the state refusing to implement a gross sales tax improve vital to sustaining town’s stage of companies to residents.
Measure L was accredited by voters in November 2020 and would improve town’s gross sales tax by a half-cent to carry the entire tax to 9.25%. The town receives simply 1% of that complete gross sales tax and the remaining goes to the state.
The rise is vital to Pacific Grove residents as a result of with out it they might see additional cuts in companies, metropolis officers have stated. The town has already needed to furlough staff all the way down to a four-day workweek due to the lack of income from gross sales and lodge taxes brought on by the COVID-19 pandemic and the following recession.
The tax improve would add wherever from $700,000 to $1 million in income for town. The rise was scheduled to take impact April 1.
It has not been made totally clear as to why the California Division of Tax and Charge Administration is refusing to implement the rise, apart from a reference to an error that was made within the strategy of adopting Measure L. It required an ordinance (metropolis regulation) slightly than a decision, metropolis officers have stated.
Over the previous month, the Herald has despatched a number of electronic mail requests to the CDTFA requesting a press release explaining its place. The one response was an unsigned electronic mail from “CDTFA-OPA” with a one-sentence assertion that solely implied that unknown necessities weren’t met.
“Earlier than contracting to manage a Transactions and Use Tax (generally often called gross sales tax), it’s our accountability to verify poll measures that improve the Transactions and Use Tax meet the entire necessities of state regulation.”
One other electronic mail request was despatched to the CDTFA on Tuesday.
Metropolis officers have stated privately the language of the poll measure was flawed, within the view of the CDTFA, in addition to the error in passing a decision slightly than an ordinance. The advice from the CDTFA is to carry one other election with correct poll language and ordinance adoption, officers stated.
The town to this point has endeavored to not take an adversarial place with the state. Metropolis Lawyer David Laredo in an electronic mail to The Herald accepted accountability for any error that was made and stated the state company was to not blame.
“The last word accountability for getting ready. promulgating and implementing an unambiguous tax measure was my accountability, and I remorse this unlucky circumstance has arisen,” Laredo wrote. “This matter shouldn’t be the fault of the state or officers of the California Division of Tax and Charge Administration.”
There have been ongoing discussions with the CDTFA, Laredo stated Tuesday. However to this point they haven’t resulted in a decision. There was no authorized motion filed, Laredo stated. In late February the Metropolis Council, on a 4-3 vote, accredited getting ready for attainable litigation.
In a letter between Laredo and the Grass Valley regulation agency Colantuno, Highsmith, Whately — a agency Pacific Grove has used for previous or ongoing litigation — obtained by retired legal professional and Pacific Grove resident Jane Haines in a California Public Data Act request, Michael Colantuno laid out a payment construction particularly associated to “the dispute with (CDTFA).”
Within the letter, Colantuno stated hourly charges for 2021 vary between $220 and $525 for attorneys’ time, and between $125 and $170 for the time of paralegals and authorized assistants. “As a courtesy to you, nevertheless, we conform to cap our charges at $350 per hour for advisory work and at $375 for litigation.”
The town could possibly be hit with a double-edged sword if the problem shouldn’t be resolved. Pacific Grove would wish to probably pay for litigation at a time when income from Measure L is being held in limbo.