Saratoga News

Utility-user's tax is proving hard to kill

Tax continues 18 days past ending time

By Sarah Lombardo

It is the tax that would not die.

After legal debates, lawsuit threats and a thorny election, Saratoga's Utility User's Tax is still causing headaches for city officials.

According to City Manager Harry Peacock, the city was notified by PG&E that the company will cease collecting the 3.5 percent tax on Dec. 19--18 days later than the date that the City Council agreed would be the end of the tax. What this means, Peacock said, is that the city owes residents refunds for the portion of tax applied between Dec. 1 and Dec. 19.

The Utility User's Tax was defeated Nov. 5 by 77 votes.

Peacock said he was not surprised that PG&E could not stop collection of the tax any sooner.

"It's like trying to stop an aircraft carrier on a dime," he said. "It's going to take a few miles for it to stop. . . . This apparently was the best [PG&E] was able to do."

Tom McCaffrey, PG&E senior project manager, said the time it takes the company to change a billing procedure was compounded by the time it took to receive
the final official election results.

"I think, ideally, the tax would've halted on the sixth of November, but there were some issues of counting ballots," McCaffrey said. "The dime was well in the rearview mirror by the time we started talking about [ceasing the tax]."

City officials notified PG&E about the tax's defeat in November, and the City Council officially repealed the tax on Dec. 4, to be effective from Dec. 1. Peacock said he was told that the company required 60 days' notice to stop collecting the tax because of PG&E's billing procedure. "So, I told them to please do it as quickly as possible," Peacock said.

In the meantime, Peacock said, residents will receive their utility tax money back.

"Anyone who gets a bill where the tax is levied starting Dec. 1 and forward, is entitled to a refund," he said.

To collect refunds, Peacock said residents should bring a copy of the bill and photo identification to the reception area at City Hall at 13777 Fruitvale Ave. between 8 a.m. and 5 p.m., Monday through Friday. Residents will receive cash refunds on the spot, Peacock said.

Residents legally have up to three years to claim their refund, but Peacock said city officials would prefer not to have the refund process drag out for too long.