A proposed sales and use tax measure will appear on the Contra Costa County ballot on June 2, 2024. The measure, which seeks to implement a five-year, 0.625% general retail sales and use tax, aims to combat anticipated deficits in the county’s health system. This decision follows a 4-1 vote from the Board of Supervisors, despite concerns regarding the accuracy of the projected budget deficit figures used to justify the tax.
The new tax is expected to generate approximately $150 million annually, which could be allocated for various expenses within the general fund. County officials, including Supervisor Shanelle Scales-Preston, emphasized the urgency of the proposal, citing potential cuts in federal funding and an estimated $18 billion state budget deficit for the fiscal year 2026-27. “We cannot wait. We don’t know what else may come down from our federal or state government,” Scales-Preston said.
Supervisor Candace Andersen was the sole dissenting vote. She raised concerns about the campaign’s messaging, which suggested an annual funding reduction of $307 million for the health system. Andersen clarified that this figure represents cumulative cuts through 2029, with the total expected reductions nearing $500 million and a projected deficit of about $1 billion by 2031. She expressed her belief that the county should postpone the measure to conduct further research and outreach. “It’s irresponsible to move forward with this today,” Andersen stated.
The Contra Costa Taxpayers Association, a local watchdog group, also criticized the proposed measure. Member Michael Arata expressed concern over the county’s existing Measure X, a half-cent sales tax approved in 2020, which generates around $120 million annually for various services. Arata argued that introducing a new tax to address a $307 million cumulative problem is excessive.
Opposition voices during the Board of Supervisors meeting expressed worries that the new tax would disproportionately affect fixed-income seniors. However, Supervisor John Gioia countered these concerns, stating that seniors might benefit from the new revenue as they are often most affected by cuts in services. County officials highlighted that the funds raised would aid all residents, especially as approximately 90,000 individuals could lose health coverage due to federal budget cuts.
The health care budget deficit does not account for upcoming unfunded federal mandates, according to Dr. Marla Stuart, director of the Employment and Human Services Department. She stated that the county would need to nearly double its eligibility staff to manage new case renewals, incurring a cost of about $117 million.
The urgency of the situation was underscored by Dr. Grant Colfax, Contra Costa Health Director, who remarked, “This is profound and very risky.” He noted that the increased burden on health care systems would impact overall community health and access to services.
A similar tax measure was recently passed in Santa Clara County, which is projected to generate $330 million annually to address an estimated $1 billion loss in federal revenue each year. Additionally, a coalition in Los Angeles County is advocating for a tax measure aimed at mitigating federal cuts, highlighting a broader trend across California.
The proposed tax could push certain cities over a local sales tax cap of 9.25%, necessitating state legislative approval to implement the measure. Currently, only El Cerrito and Pinole have sales taxes exceeding 10%, but if the measure passes, cities like Antioch, Concord, and Martinez would also exceed that threshold. A bill authored by State Assemblymember Buffy Wicks is progressing through the legislature and could be approved by summer.
In addition to this measure, another half-cent sales tax is planned for the November ballot, which aims to raise around $1 billion for transit agencies across Contra Costa, Alameda, San Mateo, and Santa Clara counties. The outcome of these tax measures will be closely watched, as they represent critical funding sources for essential public services.
