Why Oaklanders should vote YES for the sales tax increase
When Oaklanders vote in the April 15 special election, they won’t just choose a new mayor and District 2 council member — they’ll also decide on Measure A, a proposed sales tax increase.
With Oakland’s budget in crisis, this measure will play a major role in shaping how the city’s leaders attempt to fix its finances.
Read more about the potential sales tax increase and why Empower Oakland recommends everyone vote YES on Measure A.
About Measure A
Measure A proposes a half-percent sales tax increase (from 10.25% to 10.75%) in Oakland for the next 10 years. The increase is expected to bring in $29M a year to help fund city services such as police, fire, road repairs, library services, and park maintenance.
Background
Oakland’s ongoing budget crisis has forced city council to cut police and public works positions, as well as cut funding for community organizations that provide housing, health, and other social services, with potentially more to come. Measure A is intended to offset some of the most harmful cuts by increasing sales tax revenue to bolster the city’s general fund, which primarily supports police and fire services.
Notably, Alameda County already has the highest sales taxes in the state. By raising Oakland’s rate to 10.75%, it would be tied for the highest with Alameda, Albany, Hayward, Newark, San Leandro, and Union City, and relatively in line with Berkeley (10.25%) and Emeryville (10.5%).
Currently, the City of Oakland only receives 1 percentage point of the 10.25% sales tax, with the vast majority going to the state, county, and BART to fund services in Oakland. Under the new sales tax proposal, Oakland would retain all of the 0.5% increase.
The case for it
New revenue stream to help close the budget deficit and prevent further reductions to essential services like police and fire.
Fast and effective way to generate much-needed funds, helping the city avoid fiscal insolvency.
Reliable, ongoing source of revenue that gives city council time to find alternative revenue sources and identify cost cutting areas for when the 0.5% increase expires in 10 years.
Aligns with neighboring East Bay cities.
The case against it
Yet another quick fix and kicks the can on addressing the root causes of Oakland’s budget crisis.
Sales taxes are regressive, disproportionately impacting lower-income residents.
Higher sales tax could increase the cost of everyday goods, putting additional financial strain on Oakland residents.
Could discourage people from shopping or doing business in Oakland, especially with other Bay Area cities offering lower sales tax rates.
Public safety concerns are already impacting local businesses; the sales tax could exacerbate this.
Recommendation
Empower Oakland endorses Measure A — not because it’s a perfect solution, but because the consequences of rejecting this measure could be devastating to the city’s fiscal solvency.
The fact of the matter is, we take serious issue with how we got here. Oakland’s budget crisis is years in the making, driven by an over-reliance on one-time fixes (e.g. asset sales and federal grants) and irresponsible spending (e.g. city employee compensation that grew 2.5x faster than inflation).
One of the chief concerns is that this sales tax increase would appear to be more of the same. It was introduced by city council without a long-term plan to fix the bigger-picture budget problems, and there’s a risk that the revenue generated from this tax increase becomes more good money thrown to bad.
However, Oakland’s financial reality cannot be ignored. Without this additional sales tax revenue, the city faces fire station closures, even longer police response times, and deeper cuts to essential services. The status quo is simply untenable for Oakland’s businesses and residents.
We considered whether voters rejecting this tax would force the city to get serious about financial reform. But in the end, the cost to everyday Oaklanders would be too high. This revenue is needed and it provides a predictable funding stream beyond political cycles.
But Measure A alone is not enough. The real solution is electing leaders who will demand fiscal responsibility and long-term reform. To ensure real change, we urge voters to elect Empower Oakland’s endorsed candidates Loren Taylor for mayor and Charlene Wang for city council (D2) — both of which are leaders committed to fixing Oakland’s budget for the long haul.
We need to reject this tax. Unfortunately, the level of dysfunction is so deep in Oakland the only full bankruptcy can shock the heart of this patient. A State administrator would take over and the Council would be stripped of all fiscal decision-making power. This is unfortunately what Oakland needs.
There's no assurance that Oakland has any commitment to long-term accountability so the only solution is an outside takeover. It's too late for anything else and it will have to happen down the road. I would say the same for San Francisco.