To: Board of Supervisors of Sonoma County
Department or Agency Name(s): Department of Health Services
Staff Name and Phone Number: Barbie Robinson, 565-7876
Vote Requirement: Majority
Supervisorial District(s): Countywide
Title:
Title
Implementation of 2020 Behavioral Health Measure O
End
Recommended Action:
Recommended action
A) Adopt a resolution to authorize the County Administrator to execute agreements with the California Department of Tax and Fee Administration for implementation of the local transaction and use tax on behalf of the County of Sonoma authorized by Sonoma County voters.
B) Adopt a resolution to authorize the Examination of Transaction and Use (Sales) Tax Records and retain a consultant to assist with sales tax economic analysis and audit service.
C) Authorize the Director of Health Services, or designee, to coordinate with the California Department of Tax and Fee Administration to execute any other necessary documents to proceed with the administration of the tax.
end
Executive Summary:
On August 4, 2020, the Board of Supervisors adopted a resolution calling an election to submit to the voters of Sonoma County a proposed one-quarter cent sales tax measure entitled the "Mental Health, Addiction and Homeless Services Measure Transactions and Use Tax Ordinance," and ordering that the election be consolidated with the statewide general election to be conducted on November 3, 2020. The final election results for the November 3, 2020 election shows that the 2020 Measure O was approved by 67% of the voters. Pursuant to Revenue and Taxation Code 7285.5, the new ¼ cent sales tax is scheduled to become operative as of April 1, 2021. The implementation of the measure requires agreements and additional information be provided to the California Department of Tax and Fee Administration.
Discussion:
With the successful passage of Measure O, on November 6, 2020 staff received communication from the California Department of Tax and Fee Administration (CDTFA) requesting the following information in order to implement this new tax. These are standard documents required by the CDTFA when the voters approve a special sales tax measure to allow the CDTFA to administer the tax. As you can see in the table below, some items require board approval or authorization. The deadline to submit this information to the CDTFA is January 4, 2021.
|
Item |
Requires Board Approval or Authorization? |
|
Agreement for Preparation to Administer and Operate County’s Transactions and Use Tax Ordinance |
Yes, authorize CAO |
|
Agreement for State Administration of County's Transactions |
Yes, authorize CAO |
|
Certification of Final Election Results showing passage of Measure O |
Yes, separate from this agenda item |
|
Certified copy of the Transactions and Use Tax Ordinance |
Provided on 8/4/2020 BOS meeting |
|
Certified copy of the County's resolution authorizing the agreements and designating who may execute said agreements - attached |
Yes, for approval |
|
Address Information Form |
No |
|
Designation Letter |
Yes, authorize CAO |
|
District Resolution |
Yes, for approval |
|
Jurisdiction Contact Form |
No |
|
CDTFA 555-U |
No |
|
Media and Registration Request Form |
No |
As is the case with the Agriculture Preservation Open Space District Measure and other sales tax measures, it is typical to retain a consultant to assist with sales tax analysis and audits. The Department will utilize an existing contract with Hinderliter, de Llamas and Associates (HdL) to provide services for Measure O revenues. Their fees will be covered by the Department's Measure O funds. HdL's prominence in the sales tax audit industry, and its long history with Sonoma County all support the benefits of HdL providing services in support of Measure O revenues and have been considered as a single source provider for these sales tax data economic analysis and audit services.
Staff will also coordinate with the Clerk of the Board and the Sonoma County City Selection Committee to provide notice to the community about the vacancies on the Measure O Independent Citizens’ Oversight Committee as set forth in the Expenditure Plan approved by the voters. To provide transparency and ensure fiscal accountability, the Independent Citizens’ Oversight Committee shall review the receipt and expenditures of the revenue from the Measure O transaction and use tax, including the County’s annual independent audit. Seven members of the public will be selected to serve on the Committee. Two of the Committee members will be selected by the Sonoma County City Selection Committee. Additional members shall include a Hospital Representative or first responder, a business community representative and a community member with lived experience of mental health needs or homelessness. Once those committee positions have been advertised, staff will return to the Board of Supervisors with recommendations to form the Independent Oversight Committee.
Prior Board Actions:
On August 4, 2020 the Board A) adopted an ordinance entitled the “Sonoma County Local Mental Health, Addiction and Homeless Services Measure Transaction and Use Tax Ordinance” imposing a countywide 1/4 cent special transactions and use tax (sales tax) in Sonoma County for Sonoma County behavioral health and homeless services pursuant to Revenue and Taxation Code section 7285.5; B) authorized the Department of Health Services to coordinate with the County Administrator to contract with the California Department of Tax and Fee Administration to administer the tax, if approved by voters; and C) adopted a resolution calling a special election to submit to the voters of Sonoma County a one-quarter of one percent (0.25%) sales tax measure entitled “the Sonoma County Local Mental Health, Addiction and Homeless Services Measure Transaction and Use Tax Ordinance” and ordering that the special election be consolidated with the statewide general election to be conducted on November 3, 2020.
On July 28, 2020 the Board adopted a resolution introducing a proposed ordinance imposing a countywide 1/4 cent transactions and use tax (sales tax) in Sonoma County for Sonoma County behavioral health and homeless services and waiving further reading.
On July 14, 2020 the Board A) received a report from staff on proposed November 2020 Sonoma County Local Mental Health, Addiction and Homeless Services Measure Transactions and Use Tax Ordinance, including polling results and draft expenditure plan; and B) directed staff to return on July 28, 2020 to introduce and waive further reading of a proposed ordinance imposing a 1/4 cent countywide transactions and use tax (sales tax) in Sonoma County for Sonoma County behavioral health and homeless services.
Fiscal Summary
|
Expenditures |
FY 20-21 Adopted |
FY 21-22 Projected |
FY 22-23 Projected |
|
Budgeted Expenses |
|
25,000,000 |
25,000,000 |
|
Additional Appropriation Requested |
|
|
|
|
Total Expenditures |
0 |
25,000,000 |
25,000,000 |
|
Funding Sources |
|
|
|
|
General Fund/WA GF |
|
|
|
|
State/Federal |
|
|
|
|
Fees/Other |
|
25,000,000 |
25,000,000 |
|
Use of Fund Balance |
|
|
|
|
Contingencies |
|
|
|
|
Total Sources |
0 |
25,000,000 |
25,000,000 |
Narrative Explanation of Fiscal Impacts:
Measure O is estimated to generate an additional $25 million annually for the next 10 years of which will be managed by the Department of Health Services and the Community Development Commission in compliance with the Measure’s Spending Plan. Cost for the Auditor-Controller- Treasure-Tax Collector to administer the measure will come from the Measure O funds. The Department will return to the Board at a later date with a request for revenue and expenditures appropriations for the use of the Measure O funds.
|
Staffing Impacts: |
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|
|
|
Position Title (Payroll Classification) |
Monthly Salary Range (A-I Step) |
Additions (Number) |
Deletions (Number) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Narrative Explanation of Staffing Impacts (If Required):
N/A
Attachments:
Attachment 1 - Resolution to Authorize the County Administrator to Execute Agreements with the State Department of Tax and Fee Administration
Attachment 2 - Resolution to Authorize the Examination of Transaction and Use (Sales) Tax Records
Related Items “On File” with the Clerk of the Board:
None