Leaders Look Past UUT Repeal Loss to Future Fiscal Challenges

Ed Corey. Photo by Steve Whitmore

When the repeal of the utility users tax (UUT), or Measure N, went down to defeat, there was a collective sigh of relief followed by a cautionary tone of taking a long hard look at putting the city’s financial house in order.

The UUT provides about 12 percent of the city’s general fund, which translates to about $3.4 million of the city’s approximate $26 million budget. The UUT, which stays in South Pasadena, pays for police, fire, library, crossing guards, street and sidewalk repairs, the July 4th parade, and summer concerts to name just a few of the services.

The repeal effort went down to a stunning defeat where nearly 80 percent of the voters said no to Measure N on Nov. 6.

If the repeal had been victorious, city officials predicted drastic cuts would’ve been implemented and the quality of life in South Pasadena would’ve been adversely effected.

But even those who fought hard to defeat the repeal say the city has got to rein in its spending and prepare for the future fiscal challenges, especially in light of the looming pension liability facing South Pasadena as well as many cities statewide.

Ed Donnelly, co-chair of the committee that fought to defeat the repeal, South Pasadena Public Service Committee 2018, said the victory is important but the future holds ominous tidings.

“The NO on Measure N Committee would like to say, “Thank You!” to South Pas voters for defeating the misguided attempt to repeal the UUT,” Donnelly said in an email to The Review. “Our amazing team was pulled together from every corner of the community. We ran a smart, data driven campaign and kept our finances lean and mean. But it wasn’t money that brought us a victory, it was the tireless work of our volunteers. Countless hours were spent making phone calls and canvassing local neighborhoods to make sure voters got our message. Even our SPFD firefighters volunteered to knock on doors during their off duty time. With the support of the Chamber of Commerce, WISSPA, the PTA, The South Pasadena Library Board of Trustees, the Friends of the South Pasadena Library, and the SPPD Police Officers Association, we were able to make sure voters understood what was at stake and why they needed to vote ‘NO!’ We were fighting for fiscal responsibility and our quality of life here in South Pasadena. Maintaining that fiscal responsibility means we’ll have to look to the future to be sure there are prudent ways to generate revenue and to spend wisely so that we sustain our small town way of life.”

The group that fought to repeal the UUT has said all along that one of the reasons for taking on this thankless task was to alert the city as to the fiscal catastrophe that lies ahead unless the pension situation is brought under control along with what they characterized as “bloated” city salaries.

“Even though the effort to repeal the UUT failed, proponents feel that the current unsustainable financial path of the city is an issue that cannot be voted away,” Ed Ristow, Guillermo Guzman and Hugh Hemington, the leaders of the group that failed to get the UUT repealed, said in an email to The Review. “There is a huge unfunded pension liability that will have to be paid in the future. It is estimated to be over $100 million – see SouthPasTax.org – which is roughly four times the annual amount of the city’s general fund. Because of this measure, public awareness of this issue has been raised for the first time.”

The battle is far from over, all have acknowledged, because the UUT comes up for renewal again in 2020.

“That’s just 18 months away when we have to do this all over again,” Ed Corey, a local attorney who served on the No on Measure N Committee, told the So Pas City Council on Nov. 7 during public comments portion of its meeting. “There are those that say unless we get our spending in line, next time they may change their minds and not support this.”