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Welcome Partial List of Supporters F.A.Q. Sign Up or Donate Information About Measure C
The truth about the latest misinformation circulating:
  • Measure C is not a tax increase.
  • The tax can only be lowered by the Council; any other changes are subject to voter approval.
  • Audited reports verify-average Covina employee compensation does not come close to $100,000/year. On average Covina employees are paid  6%-15% below other cities of similar size.
  • Community Matters has been funded by donations from local residents and businesses, not from out of town special interests.

ERAF (Education Relief Augmentation Fund) - Is money still being taken from local governments for our schools?

In spite of the passage of Proposition 1A in 2004, the answer is yes. If you don't believe us, check your local school district budgets!

Since the early 1990s the State has shifted local property tax revenue to meet their obligation to fund education. These shifts known as ERAF (Educational Revenue Augmentation Funds)  have not been reversed by Prop 1A. According to the League of California Cities, "it did not provide local governments with any new revenue nor reduce or alter the ERAF I and II shifts." For more on this, click here.

UUT History

The Covina City Council adopted a 6% UUT,  effective November 1, 1992, after cost-saving measures were found to be insufficient to offset revenue losses due to recession and ERAF shifts.

(Back in 1992, a City Council had the authority to levy this type of tax without a vote of the public.)

The UUT implementation led to a recall in July 1993 and all five Council Members were replaced in November 1993 after a special election.

The UUT was rescinded effective October 31, 1993 after the new Council was seated.

On October 18, 1994, the new Council adopted a five year, 8.25% UUT.

November 7, 1995, the UUT was approved by the voters in an “Advisory Vote Only.” 20,428 registered voters; 5,003 (24.49%) ballots cast; 2,584 Yes votes (54.13%); and 2,190 No votes (45.87%).

The UUT was reduced to 7% in December 1995.

The UUT was reduced to 5.5% in February 1998.

March 2, 1999, a 6% UUT was approved by 55.5% of the voters. 22,800 registered voters; ballots cast 4,264 (18.7%); 2,343 Yes votes (55.51%); and 1,878 No votes (44.49%). (Laws had changed by this time, and a vote of the public was now required.)

On March 16, 1999, the UUT tax was confirmed to be approved by the voters in accordance with California Propositions 62 and 218.

Via resolution, the UUT has a maximum individual payment cap of $5,000.

Via resolution, the UUT has an exemption for individuals meeting the County/Federal very-low income standard.

Council annual budget resolutions set the UUT at 5.5% from February 1998 until July 2002 when it reverted to the 6% level set in the ordinance.

Council annual budget resolutions (not ballot measures) from FY 99-00 until 02-03 allocated UUT revenues for street maintenance (25%), library (18%), parks & recreation (18%), public safety/police (34%), council contingency (5%).

The UUT will automatically terminate (sunset) March 16, 2009.

The UUT proceeds are placed in the city’s general fund and used for the usual current expenses of the city, according to ordinance (CMC Chapter 3.14).

FY 2006-07 budget projects UUT revenue at $5.5M.

Changes in federal and state law relating to telecommunications may further impact the current deficit of $2.3M by reducing the base to which the UUT tax is applied.

The UUT continues to be used to maintain service levels.

 
Recent letters to the editor claim that the City has misspent the UUT. What has the money been used for?

It's hard to know what the authors of the letters to the editor expected the money to be used for, but some examples of where the money goes are:
  • the ongoing expenses to keep the Covina Public Library and the Parks & Recreation Department open and functioning (both departments with far fewer staff than in 1990),
  • approximately $1 million each year has been used to improve residential streets (in spite of rising construction costs and 25% fewer staff than 20 years ago) that do not qualify for restricted funding sources, for the first time in a decade,
  • the Covina Police Department has been able to fully staff the department thanks to more competitive salaries, and Covina is no longer a "training ground" for officers who get experience here and leave for cities that pay better
  • Paramedics were added to each LA County Fire engine at the request of residents, and during the life of the current UUT, the contract for County fire services has risen each year
  • and for the first time in over 15 years, the emergency reserves of the City are at a level that will cover three months of operation in the event of a major disaster.

How can the City afford to lend money to the redevelopment agency if they are broke?

In an article printed in the San Gabriel Valley Tribune on Monday, November 19, some important facts were left out. The minutes of the July 17 City Council meeting indicate adjournment to the meeting of August 7, because there was one matter that could not wait for the August 21 meeting due to County deadlines. As was announced on July 17 at the time of the adjournment, the August 7 meeting would be held at 5:30 pm in order to allow everyone to take part in National Night Out. The agenda was prepared and legally posted on August 3.

The action by the City Council to lend the Redevelopment Agency money was undertaken to ensure the Agency’s receipt of its maximum amount of tax increment. The action has numerous historical precedents, and is a common investment strategy used by previous Covina Councils as well as other cities. Investing in the Agency enables the Agency to collect the maximum amount of tax increment from the County; money that is then reinvested in the economic development of the community.

This was a wise investment for the City as well. The money that was lent to the Agency is money that is held in reserve and earns interest. At the time of the action the interest rate Covina could get on the money from other sources was 4.5%. The loan to the Agency resulted in an interest rate of 7-7.5%. This results in an increase of $190,000 per year in interest the City will receive as a result of this strategy.  

 

Why was the Library painted if it scheduled to close?

The new mural and drought tolerant garden were both grant funded projects that had been scheduled and under contract well before the defeat of the Utility Users' tax.
 

What is ERAF? Is money still being taken from cities and given to schools?

Short Answer: Educational Revenue Augmentation Funds. When the State of California needed more money for schools, they shifted part of the property tax funds that went to local governments to education. This has been done in stages and, contrary to current opinions, the first stages continue to be shifted. Check with the local school districts and they will show ERAF revenue in their budgets.

Detailed Answer: http://www.californiacityfinance.com/ERAF_facts.pdf

Why is the City building parking structures and not spending the money fixing streets?

The money used for these projects is restricted for this type of project and cannot be used for street repairs. Although Covina receives various transportation funds, they all come with strings attached and can only be spent in prescribed ways. Some money that can be used for street repairs can only be used for major arterial streets, or streets that have major bus ways. The only money that Covina has had to spend on residential street repair has been from the General Fund, the fund that relies on the UUT.

Do you have a question? Click here to submit.

100% of the Covina Utility Users Tax stays in Covina for local services.

How much does  your family pay in Utility Users Tax each month?

Every family will be different, but here is an example of the average monthly costs for one actual household living in a 2850 square foot Covina home.

  • Electricity, $400 month x 6%   = $24

  • Natural gas, $50 month x 6%   = $3

  • Telephone, $50 month x 6%     = $3

  • Cell phones (2), $100 month x 6% = $6

  • Water/trash, $50 month x 6% = $3           This household is billed every-other month.

    Total average monthly UUT for this family = $39

For this $39 per month they get ...

  • A fully staffed Police Department

  • Crossing guards

  • Graffiti removal

  • Three fire stations

  • A library with thousands of books, audio and video resources,
    computers and the people to help you find what you need

  • Recreation services including free family entertainment,
    special events, and low cost classes, sports, and swimming programs

  • A Senior Center offering free programs and services

  • And much, much more!

    What else could they spend the $39/month on?

    • 10 trips to Starbucks for a latte

    • 1/2 a month of gardening service (mow and blow only)

    • One night out at the movies

    • 1/2 tank of gas

    The Covina UUT is a bargain we can't afford to lose!

     

Nothing in this life is free, and Community Matters is a group of more than 100 individuals who believe that it is important for Covina to maintain the modest level of services we now enjoy. We also believe that these services are in jeopardy. We are not a pro-tax organization, but we are a pro-services, pro-community organization.

Every community pays for services, programs and special quality of life activities differently. For example, in most neighboring cities and in the unincorporated areas of Covina, residents pay for fire and library service through special assessments on their property tax bills. Most neighboring cities also charge residents for the cost to keep the street lights and traffic lights operating and maintain the public rights-of-way through lighting and landscaping districts. And, many of our neighboring cities, as well as the unincorporated sections of Covina also have Utility Users' Taxes, ranging from 4% in Azusa to 10% in Pomona. This type of tax, known as a UUT, was chosen because it is fair to all and does not put the entire burden of payment on property owners. Covina adopted this method of funding in the early 1990s, after years of losses in State funding and "trimming the fat" from every service area.

In March of 2007, the voters of Covina defeated the request for a 10 year extension of the tax. Community Matters believes this defeat was because voters were confused by the addition of language in the ordinance that would enable the City to continue to tax all telephone service, regardless of how people get that service. We also now know that the anti-UUT campaign spread false and misleading information to fuel this confusion and cloud the issue.

Community Matters also trusts the legally audited financial reports of the City that show there will not be enough money available from other sources to cover the loss of the $5.5 million annually, and we will begin to see a marked deterioration in our services.

The loss of the User Utility Tax will have a devastating effect on the services that make the City of Covina the type of community in which we wish to live. Our Public Safety, while not facing elimination, will be cut back in areas leaving our community open to negative influences. The Parks and Recreation Department and the Covina Library along with all of the programs they coordinate will cease to exist next year. The myriad of programs funded by the Utility Tax directly increase the desirability of our community. This correlates directly to the values of our homes and businesses. Unless other funding sources can be found, our Community needs the Utility Tax.

 

 
 

Last Revised: Tuesday, June 03, 2008