A proposed sales and use tax measure will be placed before voters in Contra Costa County during the primary election on June 2, 2024. The measure, which seeks to implement a five-year 0.625% general retail sales and use tax, has garnered mixed reactions from county supervisors and residents. The tax is projected to generate approximately $150 million annually, aimed primarily at funding the county’s health care system amid anticipated federal budget cuts.
The Board of Supervisors approved the measure with a 4-1 vote, with the majority citing the need for additional resources due to challenges posed by reductions in federal funding. Supervisor Shanelle Scales-Preston emphasized the urgency of the situation, stating, “We cannot wait. We don’t know what else may come down from our federal or state government.”
However, Supervisor Candace Andersen, who cast the dissenting vote, raised concerns about the accuracy of the financial claims supporting the tax. She highlighted that county messaging had inaccurately stated that the health system faced an annual funding reduction of $307 million, when that figure is actually a cumulative total expected through 2029. The correct cumulative reductions are closer to $500 million, with projections indicating a potential deficit of approximately $1 billion by 2031.
Andersen argued that it was “irresponsible” to proceed without more comprehensive outreach and research. “It’s just basic, good government, crossing our T’s and dotting our I’s, before we put forward a tax measure,” she said.
Critics of the tax measure, including the Contra Costa Taxpayers Association, have also voiced their concerns. The association noted that the county already has Measure X, a half-cent sales tax that generates around $120 million annually to support various services. Member Michael Arata expressed skepticism about taxing residents further to address what he termed a “cumulative problem.”
During the Board of Supervisors meeting, some opponents raised apprehensions that the new tax could disproportionately affect fixed-income seniors. In response, Supervisor John Gioia argued that seniors would benefit from the proposed measure, as they might be the most affected by the pending cuts to healthcare services.
According to Dr. Grant Colfax, the county’s Health Director, about 90,000 residents could potentially lose their health coverage due to federal spending reductions. This situation could exacerbate pressure on emergency services and lead to delayed care for vulnerable populations.
The projected budget deficit for the health care system does not account for forthcoming unfunded federal mandates that will require additional staffing, including eligibility workers. Dr. Marla Stuart, director of the Employment and Human Services Department, indicated that the county would need to nearly double its eligibility staff at an estimated cost of $117 million to meet demand.
“This is profound and very risky,” Colfax stated, noting the broader implications for the healthcare system.
A similar tax measure was successfully passed in Santa Clara County in November, which aims to generate $330 million annually to address an estimated $1 billion loss in federal revenue. A coalition in Los Angeles County, known as Restore Healthcare for Angelenos, is also advocating for measures to mitigate the impacts of federal cuts.
If the Contra Costa County tax measure is approved, it will push some cities beyond a local sales tax cap of 9.25%. To implement the tax, state legislators will need to pass a bill, currently authored by State Assemblymember Buffy Wicks, which is moving through the legislature and may receive approval by summer.
In addition to the proposed sales tax measure, another half-cent sales tax aimed at raising about $1 billion for transit agencies is set for the November ballot in Contra Costa, Alameda, San Mateo, and Santa Clara counties.
As the county prepares for the upcoming vote, the discussion surrounding the tax measure underscores the complexities of funding healthcare amidst financial challenges and the need for careful consideration of the impacts on local residents.
