TO: Mayor and City Council
THROUGH: City Council Board and Commission Appointments Committee
FROM: Keith Stahley, City Manager
SUBJECT:
title
Revenue Task Force status update.
Ward(s): All Wards
Councilor(s): All Councilors
Neighborhood(s): All Neighborhoods
Result Area(s): Good Governance.
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SUMMARY:
summary
On January 22, 2024, the Salem City Council approved the slate of 25 members and two alternates for the Revenue Task Force. The Task Force will meet seven times; consider feedback from eight focus groups, three town halls, and a statistically valid poll; and deliberate on recommendations to the City Council concerning revenue options to support City services funded by the General Fund. Recommendations will be presented to the City Council in a Work Session on July 15, 2024.
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ISSUE:
Receive an information update and progress report on the Revenue Task Force.
RECOMMENDATION:
recommendation
Information only.
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FACTS AND FINDINGS:
At their December 11, 2023 meeting, the Salem City Council approved a charter and a budget for the Revenue Task Force. The purpose of the Revenue Task Force is to explore new, additional revenue sources and adjustment to fees to sustain those services that do not have a dedicated revenue stream. The Task Force’s work is being carried out in parallel with the work of the Budget Committee and City Council as they formulate the proposed 2025 budget based on revised revenue projections.
City Council periodically receives updates on Task Force activities from the group’s meetings and outreach activities. Staff have presented updates on the Revenue Task Force to the Latino Business Alliance membership, East Salem Rotary, and the West Salem Neighborhood Association among other invitations. A team of staff, Moss Adams, Parachute Strategies, and DHM support the Task Force with facilitation, community engagement and surveying, revenue analysis, and project management.
Task Force Meetings. As of this writing, the Task Force has met four times and is looking forward to its fifth meeting. In all, seven meetings are planned with the remaining meetings focused on Task Force deliberations about revenue options which may be recommended to City Council at their July 15 Work Session. To-date members have considered 41 revenue options, ranked evaluation criteria, and discussed feedback from focus groups, a statistically valid poll, and three town halls. Materials for the Task Force meetings are released in advance of each meeting. These materials are available on the City’s the 2024 Revenue Task Force web page <https://www.cityofsalem.net/government/boards-commissions/other-advisory-groups/2024-revenue-task-force>.
Focus Groups. A focus group is a research method used to gather qualitative data about a specific topic or issue to help inform future work. Unlike a public meeting, it is not typically open to the general public because it is designed to gather nuanced and detailed feedback from a specific group of individuals. A focus group was held for each ward between February 26 and March 7. There was an open application process and 101 community members were invited to participate. A detailed summary of discussion themes was presented <https://www.cityofsalem.net/home/showpublisheddocument/22907/638508404586070000>.
Survey. During the first week of April, through a statistically valid poll, DHM gauged awareness of revenue need and possible revenue options. This input was shared at the April 25 Revenue Task Force meeting <https://www.cityofsalem.net/home/showpublisheddocument/22779/638495584403800000>. The survey occurred from April 1-7, 2024, via phone and text in both Spanish and English. Findings from the survey include:
• Community mood: Just over half of residents are satisfied with their quality of life in Salem. 2 in 3 rate their current financial situation as good, though under half rate the city’s economic conditions as good.
• Service values and priorities: Satisfaction with the value of services from the General Fund for the cost of taxes and fees paid is rebounding from a 2020 drop, with just below half currently satisfied. Fire and police are the top items that people would pay more for, followed by parks and libraries, which mostly follows the order of satisfaction with services. Those who are more satisfied with their personal finances and quality of life and perceive the City finances as good, are more likely to say they would pay more across all services tested.
• Funding criteria and values: Salem residents rate a lack of impact on the local economy as the most important decision criterion. About 50-60% of residents rate the other criteria as important, but none as strong as the top item. They prefer to rely on taxes paid by businesses and those who use specific items and services over individuals or having everyone pay. Their strongest preference is for progressive over regressive taxes and fees.
• Funding mechanisms: Residents rate user fees and business taxes as the best ways for the city to raise revenue and the first priorities for the city to move forward with over other funding mechanisms. Support for payment in lieu of taxes is high, with just over half strongly supportive.
Town Halls. Also in April, three town halls were held to provide feedback on key issues and options being considered. Themes from the town halls <https://www.cityofsalem.net/home/showpublisheddocument/22796/638507596324970000> were also presented at the April 25 Revenue Task Force meeting. Most town hall participants were very or somewhat satisfied with their quality of life in Salem (85%), and with the value of City services (80%). Most were willing to pay more for City services and shared their preferences for revenue options in which:
• People pay an amount that is proportional to their income or wealth;
• Rely more on taxes or fees on specific items or services, paid for by the people who use or buy them;
• Rely more on taxes and fees paid for by businesses in the community; and
• Implement new taxes or fees before raising or increasing the ones we already pay.
BACKGROUND:
In 2023, the City Council held multiple work sessions on continuing General Fund services and forming a Revenue Task Force. On November 27, 2023, Salem City Council formed a Revenue Task Force. At their December 11, 2023, City Council approved the Revenue Task Force Charter and discussed membership selection process and timeline. On January 22, 2024, Salem City Council approved the slate of 25 members and two alternates for the Revenue Task Force. Additional status reports to Council are anticipated on a monthly basis, with a Work Session devoted to the Task Force recommendations on July 15, 2024.
Courtney Knox Busch
Chief Strategy Officer
Attachments:
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