Tongson: Oakley P-6 Tax Explained, Helps Fund Police Department

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A long-existing, yet seemingly obscure tax in the City of Oakley continues to prove its importance and vitality to residents and the city’s police department, more than thirty years after being established.

Recently, some residents began to question the tax and why on agenda items an agenda item keeps showing up entitled “Oakley Special Police Tax Area”. Most recently, Zone 167 was created on a 3.27 acre public storage project on E Cypress where the tax for this parcel was $3,220.95.

Another example was at the June 12 meeting, Zone 160 was created for the “Gilbert Property” which consists of 222 residential lots over 9 acres with phase 2 consisting of 581 residential units planned. In total, the tax will bring in $623,790 in Fiscal Year 2018/19 with homes being tax $1,073.65 and any undeveloped parcels are $536.83.

In total, a little over 6,000 parcels of the more than 13,000 parcels in Oakley pay a P-6 tax.

The P-6 Tax, established decades ago by Contra Costa County in anticipation of the growth in population in the Oakley region, continues to provide essential funds that helps maintain Oakley’s law enforcement services.

“The P-6 funds are critical to the operations of the Oakley Police Department,” said Oakley Chief of Police Chris Thorsen. “Without this critical funding, we would not have the police department we have now.”

The P-6 Tax was a long-term predictable revenue source that was originally formulated in the 1980’s with the idea of helping to fund the Oakley Police Department. Upon Oakley’s incorporation as a city in 1999, the newly formed city continued the P-6 Tax to continue funding as the city branched off from jurisdiction of the Contra Costa County Sheriff’s Department.

Currently, the P-6 Tax funds approximately half of the operational cost of the police department, which serves Oakley’s population of approximately 45,000 residents with 34 sworn officers, to go along with the City of Oakley’s support staff who work in records, evidence, parking enforcement, sex registrant, and other roles.

“We have about 13,000 parcels in the City of Oakley,” added Thorsen. “The P-6 Tax is paid by 6,026 parcels in the City of Oakley. The tax is charged to all new residential and commercial construction.”

Upon its inception in the 1980’s, the goal of the P-6 Tax was to establish a .91 officer per thousand resident ratio. In a recent survey conducted this year of law enforcement services in Contra Costa County, data was collected regarding law enforcement staffing and expenditures. The data showed that staffing levels in Contra Costa County varied from a low of .69 officers per thousand residents to a high of two officers per thousand residents. As a comparison, the current sworn staffing ratio equates to approximately .75 officers per thousand residents at a cost of approximately $220 per resident. Costs for services range however, from a low of $173 per resident to a high of $488 per resident.

“The equity issue is an interesting one,” continued Thorsen, who noted that this issue not only applies to the P-6 Tax, but to other taxes as well. “Property taxes are assessed on the sales price of an individual home. Those property taxes are then locked in under the provisions of Proposition 13. A home owner who purchased their home 20 years ago for $150,000 pays a far lower property tax amount than the person who buys the home next door this year for $500,000. I have lived in the same home for over 26 years. My neighbor pays nearly three times the property tax that I pay, yet we drive the same roads, use the same parks, and get the same police response. If you asked my neighbor if they think that’s fair, I think you can probably guess the answer.”

According to Thorsen, the collection of the P-6 taxes is deposited directly into a separate special revenue fund. From there, the funds are then transferred to the general fund in order to offset expenditures in the police department.  Additionally, a Comprehensive Annual Financial Report is prepared each year and reviewed by independent auditors, which reduces the expenditures of the police department by the amount of P-6 Tax received from the special revenue fund.

In the City of Oakley budget for the 2018/2019 fiscal year, the operating budget for the police department is approximately $9.6 million dollars. P-6 revenue estimates for the 2018/2019 fiscal year are approximately $4.3 million dollars. Since the inception of the P-6 Tax, total law enforcement expenditures have been estimated to be roughly $100 million. Revenue collected from the P-6 Tax to date has generated approximately $32 million.

“The use of the funds is reviewed each year by an independent auditor to assure they are being spent appropriately,” said Thorsen. “Each year, an annual operating budget is presented to the Oakley City Council. Ultimately, the City Council approves the expenditures of the City of Oakley. They are citizens from this community, elected by the residents.”

Despite being in existence for years and not being a “new” tax, some residents are somewhat surprised at its existence and its efficiency, even though it has been in effect for over two decades.

“When I drive around town, it is rare I see police presence,” said one anonymous resident, who was previously unaware of the tax. “In fact I had figured throughout the years that tax cuts had depleted the EMS and police services. I had just accepted that is how it is. We have had a lot of break-ins throughout the years, we have had to call the police department several times and response times are a bit long. I sure wish we had more police presence for the amount given to fund the Oakley Police Department.”

While not all citizens appear to be generally aware of the specifics of the P-6 Tax or even its existence, many residents who are aware of the tax appear to be supportive due to the critical need for law enforcement and the importance of the police department.

“I believe we need to invest in our police department for operating cost and equipment in order to continue to protect and serve our community,” said Ben, a resident of Oakley. “I am okay with the bill as long as the funds don’t get allocated somewhere else like most taxes and assessments do.”

One longtime resident, who has watched the city grow considerably prior to its incorporation as a city, is pleased overall with the city’s progress.

“I’ve lived in Oakley a long time. It took us years to develop as a city and to branch off from the Contra Costa County Sheriff’s Department. We do not want to fall behind as the city grows. I’m not sure what the exact crime rate is, but I believe it’s less than other cities, which is a good thing. We need to stand by and develop our police department.”

Fellow Oakley resident Mike Pineda added, “I am in agreement with the tax being able to help our local police department. Our city is safe because we have utilized the resources necessary to grow our police force in number, gear, and supplies.”

While the notion of paying taxes is something that is generally scoffed at, Chief Thorsen stressed the importance of the P-6 Tax and how vital it is to the city, likening it to the current situation with the East Contra Costa Fire Protection District (ECCFPD), another critical service which has suffered from recent financial problems, forcing fire station closures and a depletion of services.

“I think it’s fair to say nobody really likes to pay taxes,” admitted Thorsen. “And, everybody likes to feel like they are being treated fairly when it comes to taxes and the services we receive. But the fact remains we need a police department, streets, and parks. Those services have to be funded. Had the P-6 Tax not been established all those years ago, my guess is the Oakley Police Department would be in the same dire financial situation as the ECCFPD.”

 

Sean Tongson, writer, is a resident of East Contra Costa County, a proud husband and father, and enjoys outdoor activities such as hiking, road tripping, and traveling.

An avid bay area sports fan, Sean’s favorite teams include the 49ers, Giants, Sharks, and Warriors.

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5 COMMENTS

  1. Prop 13 came about because people who were living in their homes for decades, got older, retired, with limited income, could be forced out of their home due to increased taxes that they could not afford. When you buy a home, you know what the taxes are, how much they will increase, and the bank who approves your mortgage knows that you can pay those taxes. You have an income, with expected raises, but elderly people do not. The young people should not gripe as Prop 13 will be there to protect them when they are older.

  2. Christine, very well said. Those who want to change it now will surely regret it later if they still have a house.

  3. Christine, you champion prop 13 and over simplify it. Prop 13 doesn’t apply to only retired and fixed income residents. It also applies to commercial property and properties inherited. If one inherits a million dollar property, they should have to pay the taxes associated with maintaining the city services that provide for the value of the property. Prop 13 could easily be fixed while still affording the elderly much needed protections.

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