The half-cent sales tax approved by San Luis Obispo voters in 2006 is funding a project to rebuild a heavily traveled section of Los Osos Valley Road between the Highway 101 on- and off-ramps starting next week.
The $200,000 job is one of many paid for by the more than $5.3 million in Measure Y funds that the city receives annually.
The city is nearing the midpoint of the eight-year measure — which expires in April 2015 unless renewed by voters in November 2014. City leaders are saying that the money is needed more than ever.
A five-year fiscal forecast presented to the council Tuesday indicated that the city will face an $11 million annual shortfall by 2015 if Measure Y funding ends.
A community meeting held last week to discuss how the Measure Y funds have been spent so far highlighted specific projects, such as open-space preservation at Johnson Ranch, new lights at Damon Garcia Sports Fields, a remodel of the senior center’s kitchen and bathrooms and a new parking lot for the center.
The added sales tax has also been used to hire a fulltime fire marshal, pave neighborhood streets and initiate a design of the Los Osos Valley Road interchange.
According to a city tally of the $23.5 million of Measure Y funds collected from the measure’s beginning in 2007 through 2011, about $8.2 million has been spent on operating costs, mostly staff wages, and about $15.3 million on capital expenses.
Community members said they were concerned that too much of the money — which was meant to pay for services such as street maintenance, traffic congestion relief, public safety, flood protection and open-space preservation — was being spent on salaries and the city’s other day-to-day operational costs.
“I want to make sure that this money is used to keep investing in the future, not filling the gaps to get by,” said Paul Brown, a former councilman, at the community meeting last week.
City Manager Katie Lichtig said the increased revenue from the measure has enabled San Luis Obispo to avoid making deep cuts like cities throughout the state because of the recession.
“Given that this is the worst recession since the Great Depression, we have avoided making difficult cuts to services that we would have had to make by using Measure Y revenue,” said Lichtig, adding that when the measure passed, it was expected to raise about $6 million in revenue a year but has never reached that point.
“Are we able to do everything we thought we were going to be able to do?” Lichtig said. “The answer is no. But we have been able to accomplish more than we would have without the added funds.”
Public concern has also been raised that the added sales tax has mainly been used to fund a binding arbitration decision that awarded sizable raises to police in 2008.
“I wouldn’t say that Measure Y revenue took a hit because of that,” said Bill Statler, the city’s finance director. “It did take a hit on general fund revenues, and Measure Y funds are a part of the general fund.”
Statler said that Measure Y funds continue to be dedicated to the projects the council prioritizes.
“The relationship between Measure Y and binding arbitration is not a straight line,” Statler said, adding that the mandated salary increases were not the only new challenge facing the city since the measure was passed.
“At the end of this, it will come down to whether the public thinks we did a good job navigating our way through these challenges,” Statler said. “Did the council and staff make good decisions about using the resources available to us? That is how voters are going to make the decision about whether to renew the sales tax or not.”