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Politics & Government

Mayor Address Focuses on UUT Rate Hike

Mayor John Buchanan delivered a State of the City Address on Monday night urging voters to approve the Utility Users Tax Rate Increase Extension, or Measure 12-1.

About 200 residents and city officials gathered at the Sierra Madre Recreation Center Monday night for Mayor John Buchanan’s State of the City Address.

Mayor Buchanan’s 30-minute speech was primarily dedicated to urging residents to vote yes on Measure 12-1, which would extend the Utility Users Tax Increase.

“I can report tonight that the state of the city of Sierra Madre is good, as we have sailed a steady course financially over the years," said Mayor Buchanan. "But I also need to report to all of you tonight that we are sailing into strong headwinds."

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Mayor Buchanan said that in order to keep Sierra Madre’s police, paramedics and fire department operating with “21st century services,” and to continue many of the community programs in town like library services, community recreation programs and public works services, an extension of the UUT rate increase is needed.

The Mayor also said that and the City Council has taken a toll on the City budget, and extra funds are needed.

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About the UUT

The UUT was set at 6 percent until 2008, when voters approved Measure U, a temporary UUT rate increase. The UUT is currently collected at 10 percent, but the City Council has the authority to raise it as high as 12 percent until July 2014.

After 2014, the UUT is set to sunset back to its original 6 percent by July 2016 … unless Measure 12-1 passes.

If Measure 12-1 passes, the UUT rate could be as high as 12 percent until July 2018. After that, the UUT would begin to sunset back down to 6 percent by July 2020. 

The UUT collects on electricity, gas, phone, cable, trash, water and sewer, and all of the money goes into the city’s General Fund, which funds police, fire, administrative costs, library services, public works and “all non-restricted fund activities of the city.”

“Without [Measure U] there would be over a $1 millon hole in our budget,” said Mayor Buchanan. “Frankly, without a commitment to its renewal, we will have to plan beginning in 2013 for a very different Sierra Madre.”

Money from the UUT makes up about 34 percent of the city’s General Fund. Property taxes are the largest contributor to General Fund monies, making up about 40 percent of the total pot. The rest of the money comes from vehicle license fees, sales tax, franchise fees and other fees.

Whether the UUT rate increase will happen is up to voters. Measure 12-1 will be on the April 10 ballot.

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