HUNTINGTON BEACH : 5% Utility Tax OKd for Cable TV Users

Despite protests from the cable-television company serving the city, the City Council voted 5 to 2 Monday night to impose a 5% utility tax on cable TV users, effective July 17.

Council members Don MacAllister and Ron Silva cast the dissenting votes.

The city staff said the tax will cost cable TV users an extra $1.50 or so per month. The city heretofore has not taxed cable TV. By its action Monday night, the City Council joined two other Orange County cities, Placentia and Westminster, in putting a utility tax on cable TV.

Huntington Beach’s 5% cable TV tax is expected to raise $750,000 a year.

Placentia has had a 3% cable TV tax since 1985. Officials in that city said the tax should bring in about $68,000 this fiscal year.

Westminster has imposed a 5% cable TV tax since 1987. The tax amounts to about $120,000 a year, Westminster officials said.

Anaheim later this month is scheduled to consider imposing a 3% cable TV tax.

The cities’ move to put a tax on cable TV comes amid an economic crunch. Less sales-tax revenue is flowing into city treasuries as declining sales reflect a downturn in the national economy.

Huntington Beach is facing a $3.4-million budget shortfall in the next fiscal year. The city needs another revenue source next year if it is to keep its Police and Fire departments intact, according to City Administrator Michael T. Uberuaga. He urged the council to adopt the cable tax. The money would not only prevent police and fire cuts but would also finance a new police substation in the downtown area, Uberuaga said.

But a representative of Paragon Cable, which serves about 43,000 Huntington Beach customers, urged the council not to impose the tax.

“We do understand the dilemma of cities. Nevertheless, we don’t feel that cable TV is able to assume this large position in helping to solve the problem,” said Donal D. Weddle, Paragon’s public affairs director.

The City Council also voted unanimously to increase the city’s monthly trash-collection fee from the current $9.85 to $10.89. City staffers urged the increase, noting that the trash collection company serving the city had increased its costs.