City Council explores utility users tax options amid budget concerns

The Special South Gate City Council Meeting held on June 17, 2025, focused primarily on the potential implementation of a Utility Users Tax (UUT) to address the city's ongoing budgetary challenges. The meeting began with a presentation from city officials outlining the necessity for additional revenue sources to maintain essential city services.

The discussion highlighted that the proposed UUT would require voter approval, emphasizing that the council cannot unilaterally impose this tax. The estimated costs associated with placing the UUT on the ballot were significant, with a recent estimate indicating that a standalone election could exceed $1.2 million. In contrast, including the measure in an already scheduled election could reduce costs to approximately $275,000.

City officials explained that the UUT would be calculated based on residents' utility usage, with lower-income households potentially benefiting from a built-in subsidy due to reduced utility rates. The estimated annual tax burden for residents could range from $3.12 to $630, depending on usage and the final tax percentage set by voters.

Council members expressed concerns about the timing and implications of introducing the UUT, noting that many neighboring cities have had similar taxes in place for years, resulting in significant revenue advantages. They acknowledged the need for a comprehensive review of all potential revenue sources, including adjustments to existing fees and charges, to ensure a balanced approach to the city's financial health.

The council also discussed the importance of community engagement in the decision-making process. Suggestions were made to conduct surveys to gauge public sentiment regarding the UUT and to explore various utility options that could be included in the tax structure.

As the meeting concluded, city officials reiterated the urgency of addressing the city's structural deficit and the need for a strategic plan moving forward. The next steps involve determining the appropriate timing for a ballot measure and further discussions on how to structure the UUT to best serve the community's needs.