San Jose shelves prospective parcel tax to pay for city parks

Citing a lack of necessary voter support and an already crowded November ballot, the San Jose City Council decided to punt on a prospective parcel tax measure to help fund city parks.

“Obviously, it’s not the feedback we were hoping to see or at least many of us I think were hoping to see but also very understandable given the concerns,” said San Jose Mayor Matt Mahan. “I know we’re all hearing from our constituents about cost of living and other pressing issues like unsheltered homelessness and public safety challenges.”

With a parks maintenance backlog that has ballooned to over $500 million, San Jose has spent the past few months exploring other potential revenue streams but multiple rounds of polling have not instilled enough confidence to place it on the ballot, leading the City Council to defer action until a later date.

In addition to looking at a parcel tax, city staff also sought input on how voters would react to seeing a general obligation bond on the ballot or amending the city charter to allow commercial leases of parklands for up to 55 years.

Both of those options, however, failed to garner enough interest during the initial polling stage in May, prompting city staff to turn its focus squarely to the viability of a parcel tax, which requires 66.67% support to pass.

The initial round of polling from May found that close to two-thirds of survey participants supported a parcel tax assessed at one cent per square foot for residential lots and three cents per square foot for nonresidential uses. If it had made it on the ballot and passed, the parcel tax would have cost the average homeowner $69 annually.

Some councilmembers, however, warned in June that adding a tax measure to the ballot could lead to “cannibalization” of other local and state initiatives with many residents feeling overtaxed.

Officials have already placed a $10 billion climate bond and $10 billion statewide school infrastructure measure on the November ballot. Locally, voters will be asked to fund a $20 billion affordable housing bond placed on the ballot by the Bay Area Housing Finance Authority. The San Jose Unified School District is also asking voters for their support in financing a $1.2 billion infrastructure bond.

Each bond measure alone would pass hundreds of dollars in additional costs onto property owners if successful.

During the second round of polling, it became evident that more residents were unwilling to pay the price as support dropped to 59% for three different prospective parcel tax options, including a half-cent per square foot option or a flat $35 fee.

While not isolated to San Jose, a survey by the Public Policy Institute of California also found growing pessimism statewide about the current economic climate with 68% expecting harsher times ahead.

“Many residents in our district definitely feel overtaxed,” said District 10 Councilmember Arjun Batra. “They are feeling that the money is becoming tight or they’re looking at a future, which is not as rosy as it might have looked a little while ago with the number of layoffs being announced.”

Although the lack of voter support is a blow to funding parks, it may be easier to gather the requisite support when the City Council revisits additional revenue options down the road. This year’s ballot includes a constitutional amendment that could lower the passage threshold for local bonds focusing on public infrastructure from two-thirds to 55%.

Some members of the City Council already have expressed support for the constitutional amendment, authoring a joint memo this week to argue for its passage.