What is Measure DB on the November 3, 2020 Ballot?

With the November 3 election now a matter of days away, voters are busy studying the issues in preparation to cast their votes. In addition to choosing local, state, and federal elected representatives, voters will consider a number of statewide propositions and local measures. One of those is Measure DB, which would increase the local sales tax rate by three-quarters of one percent, generating revenues up to $3.8 million annually. Those revenues would stay in the City of Diamond Bar and could not be taken by the county or state.

When considering a matter such as Measure DB, it's helpful to understand how the City receives revenue to fund fiscal year 2020-21 General Fund appropriations of $25,811,158. Almost 65% of General Fund revenues come from just three sources:

Property Tax in Lieu of Vehicle License Fees (25.8% of General Fund
Revenues)

In 2004, the state legislature permanently reduced vehicle license fee rates from 2 percent to 0.65 percent, dramatically cutting a longstanding local government revenue source. To compensate, the state provides a dollar-for dollar match to the City from state property revenues. These revenues now present the City’s single-largest General Fund revenue source. Even so, these revenues are not enough to cover annual public safety costs, which now exceed $8 million.

Property Taxes (22.1% of General Fund Revenues)

Property tax is assessed on real property (usually land and buildings) and moveable property like boats, aircraft, and business equipment. Diamond Bar receives only five cents of every dollar of property tax generated locally, a rate established at incorporation that is unlikely to change. That means that 95% of all local property tax dollars go to the state and county.

Sales & Use Taxes (16.6% of General Fund Revenues)

Sales and use taxes are applied to most retail purchases, with a few exceptions. Currently, the local sales and use tax rate is 9.5%. Diamond Bar receives one cent of the 9.5 cents generated on each dollar of sales and use tax. A recent study estimated that about 40 percent of Diamond Bar’s sales tax revenues come from visitors making purchases in town.

With the City largely built-out, significant new developments are unlikely. This means that the City’s property tax revenues are essentially bound by annual Consumer Price Index adjustments. The same goes for adjustments to the City’s Property Tax in Lieu of Vehicle License Fee revenue share. Measure DB, on the other hand, is an option to increase local revenues outside the confines established by the state or county.

If Measure DB is passed by the voters, sales and use tax revenues would likely become the largest General Fund revenue source – one that could be used to develop new parks and improve existing facilities, repair streets and public infrastructure, strengthen public safety and crime prevention services, and create continuous streetscape improvements to enhance the look and experience of the city.

To learn more about Measure DB and the City’s financial condition, please join us at one or both virtual town hall meetings coming up later this month on October 14 and October 28 at 6:30 p.m.

These meetings will continue the conversation from September’s town halls and will include a short presentation followed by a forum to answer your questions. Participants must register in advance to participate, so please visit www.diamondbarca.gov/measureDB to sign up and receive the link. I look forward to meeting with you.

If you’re not able to attend or you simply have questions or comments you’d like to share outside the meeting, I remain available via email at RMcLean@diamondbarca.gov or phone at 909-839-7016.

Until then, I wish everyone good health.