ELECTION 2024: Manhattan Beach Sales tax ballot measure intended for City infrastructure

by Mark McDermott 

The Manhattan Beach City Council has over the past two years taken several significant steps aimed at the City’s long term financial sustainability. 

Some were financially arcane maneuvers, such as the issuance of pension obligation bonds that took advantage of low interest rates in order to cover ballooning employee retirement costs in a way that would not bleed from the City’s General Fund, which is needed to pay for core City services. Likewise, the passage of a stormwater drain ballot measure last March increased the enterprise fund’s fee and insured that it would no longer bleed millions of dollars from the General Fund. 

The Council was setting its financial house in order. The fact that the City  was able to hire seven new police officers this year, using General Fund monies, was tied to these financial actions. 

The proposed half-cent sales tax increase on the November 5 ballot, a measure which the council unanimously approved in August, is another step in this larger plan. 

Measure MMB, dubbed as the “Move MB Forward” measure, would raise the sales tax in Manhattan Beach a half-cent and generate an estimated $5.3 million annually for the City. Though the money would not be specifically earmarked, the Council’s stated intention is to use the new revenue to address more than $200 million in infrastructure and capital project needs, many which are considered long overdue. 

The council passed a resolution in favor of Measure MMB at its September 3 meeting. Councilperson Richard Montgomery argued that, among other things, the ballot measure was about keeping the money local. All of the half-cent increase returns to the city, as opposed to just 10 percent of the current sales tax. Passage of MMB would also limit LA County’s ability to pass another sales tax increase for its use because sales taxes in California are capped at 10.25 percent.

LA County passed a quarter-cent increase in 2017 to address homelessness.

“If we residents do not pass this sales tax measure, and the $5.3 million doesn’t come here, it goes to LA County,” Montgomery said. “There’s if, and, or buts, folks —  we pass it here, or they get it. Those of you who want local control of money to stay here, this is your chance to vote. You have to keep that money here, and then we can decide where it’s going to go. The State can’t touch it. LA County can’t touch it. It stays here with us.” 

Councilperson Steve Napolitano said the storm drain measure stabilized the part of the City’s budget that pays employees and provides services. 

“That was for operational issues,” Napolitano said. “This is for everything else that everybody wants —  the pool, the streets, the outdoor dining, the wider sidewalks, Lot 3 for more parking, whatever it is,” Napolitano said. 

“We have been making these choices to rebuild and to stabilize,” said Mayor Pro Tem Amy Howorth. “This is the next step…This is not just some one-off. This is not just out of the blue. This is a wise thing for our community to maintain local control and attempt to make some infrastructure improvements.” 

Councilperson David Lesser said Measure MMB both keeps sales tax local and will have a multiplying effect, by enabling the City to both pay directly for capital improvements and potentially seek bonds for its largest projects, many of which will cost tens of millions of dollars. 

“It is to stay local, but it is also part of our challenge as your fiscal leaders —  which is, we do not have the funds to pay for our deteriorating capital infrastructure,” Lesser said. “Our parking lot downtown, Lot 3, is really a case study….But even the building in which we’re temporarily having our council meeting this evening [the Josyln Center] —  we’ve done some modifications to upgrade it, but before long, we’re going to need to think about, longterm, either more upgrades of the existing facility or an upgraded building. We do not have the funds to do that….We cannot even go out for bonds because we don’t have enough revenue coming in. This will help provide the services and the infrastructure that our residents have come to expect.” 

Mayor Joe Franklin noted that 61 percent of sales tax revenues come from visitors to the city, meaning over half of the tax increase would be paid by non-residents. 

“So this is going to go ahead and share that burden with our visitors, their vehicles on the roads, needing to park —  the wear and tear on our city,” he said. “And that’s fine, but we want to be prepared for it, and [the sales tax] gives us a chance to have them pay for it, as well. Because the reason they are coming here is this is a beautiful city, and that does not happen by accident. It takes planning, and the ability to see the future.” ER