The City has used a lot of tricks to avoid fiscal realities, but soon will not be able to dodge a number of shocks:
1. Property tax revenues have increased about 10% annually lately due to the RE boom. Significant time lags delay the revenue hit, but it is now coming and it is big.
2. Sales tax revenues will be hit with the recession all but here–again, time lags delay its impact.
3. Development Services revenue will fall with the current drop-off in building.
4. Deferred maintenance games can no longer be played. Other costs will also come home to roost–fuel, pension, hiring needs (we do have one of the leanest personnel staffing levels compared to other cities, so can’t cut there).
One of the likely revenue raisers is a big jump in the property transfer tax when you buy a property. It is far bigger in other parts of the country, and so is an easy target. Another target is our relatively low TOT, as compared to other tourist destinations. And, of course, the sales tax, a prodigous revenue raiser when hiked.
