Voters Approve 2 Tax Measures for Desert Hot Springs

Voters overwhelmingly approved a pair of tax measures Tuesday that will raise desperately needed cash designed to keep this Coachella Valley city out of bankruptcy.

Seventy-nine percent of the 2,100 votes cast were in favor of Measure E, which will impose a new $100-per-home annual property tax and a tax on commercial property. The tax is projected to raise $1.1 million for police and other public safety services. The measure required a two-thirds majority for adoption.

Measure F, which provides for a five-year extension of a 5% utility tax, also was approved by 79% of the voters, though it needed only a simple majority to pass. The tax is to raise $680,000 annually for debt service and city operations.

Without money from the two taxes, this city of 15,000 could have faced bankruptcy and the dismantling of its police department. The city, beset by years of financial problems, is $2.2 million in debt and has only $20,000 in the bank.

“I’m elated; I’m thrilled,” said Mayor Matt Weyuker, one of four recently elected City Council members.

The tax victory “means that we’re viable,” Weyuker said. “It means that the city can go forward, pay its debts and be all that everybody wants it to be.”

Only 10 cities in the state have approached insolvency since 1983, according to the California League of Cities, and none went bankrupt.

Just about 15 miles north of Palm Springs and other desert resort communities, Desert Hot Springs has not shared in their affluence. Plagued by high crime rates, the city has struggled to attract new business and expand its tax base.

A new 27-member police force took over from the county sheriff three years ago, helping to cap crime and restore confidence, but the city lacks money to pay for it without the parcel tax.

Largely managed by a crisis team of county officials, the city also is struggling with $2.2 million in debt and has twice defaulted on revenue anticipation notes since 1998.