San Jose leaders Tuesday passed on putting a tax measure on November's ballot after recent polling showed that support among city voters remains tepid despite police layoffs and deep cuts to other city services.

But Mayor Chuck Reed and other City Council members warmed to the idea of seeking voter approval for upping the sales tax in November 2012, when a broader and more liberal voter base might be more receptive.

"It's clearly not going to happen in November of this year," Reed said. "I think November 2012 is probably the best time to put a tax measure on."

The tax discussion came during the council's first meeting since its July break, during which city polling consultants surveyed 1,206 likely San Jose voters on several possible November 2011 measures.

The suggested measures included both quarter-cent and half-cent sales taxes, either for general revenue requiring simple majority approval or measures specifically to fund police and fire services requiring two-thirds approval.

The poll by Fairbank, Maslin, Maullin, Metz and Associates, taken July 13-19, found that a special tax dedicated to public safety services garnered support from just half of those polled, well short of the two-thirds threshold. The margin of error was plus or minus 2.8 percentage points.

The survey, however, found potential support for general sales taxes. The poll found 57 percent might approve a quarter-cent sales tax. But just 31 percent were firm supporters.


San Jose's current sales tax rate just dropped to 8.25 percent after last month's expiration of a temporary one-cent state sales tax hike approved by the Legislature in 2009.

Consultant David Metz said a tax proposal needs about 60 percent overall approval and 35 percent firm support in polling to be considered viable.
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Support for a sales tax is still very soft," Metz told the council.

Putting a tax measure on the ballot this November would require a costly special election and a unanimous City Council declaration of a fiscal emergency. And it was clear Tuesday that wasn't going to happen. At least one council member, Sam Liccardo, had signaled before the meeting that he would oppose a November tax vote.

But Councilman Ash Kalra noted that the polling data showed that after the recent layoffs -- including 66 police officers -- surveyed residents showed more support for taxes than further service cuts.

"I don't think the numbers are as pessimistic as some have suggested," Kalra said. "It's encouraging given the voter base we looked at."

While Reed agreed the electorate will likely be more open to tax hikes in November 2012, he said the council will have to get the city's financial house in order before making a serious pitch to voters to open their wallets.

San Jose just closed a $115 million deficit, mostly by cutting staff and trimming paychecks. The city is projecting an 11th straight deficit in the coming budget year, a chasm totaling at least $78 million. And that gap is expected to grow as employee pension costs continue to soar.

San Jose's pension tab has tripled in a decade to $245 million and is expected to balloon to $400 million or more in four years to cover an estimated $2 billion shortfall, a result of past benefit hikes, market losses and flawed assumptions. Reed noted that such increases dwarf the projected $34 million in new revenue a year from a quarter-cent sales tax.

Reed has proposed controversial pension reforms that he hopes to put before city voters in the spring. He's calling for reduced retirement benefits, not only for future hires but also for current employees and retirees. The city's current workers and retirees would keep benefits earned to date but see smaller increases in the future.

The council has approved negotiations with employee unions on ballot language through October. An update Tuesday indicated employee frustration with the talks. Employee representatives have suggested any involuntary reduction in their pension benefits would invite a court fight over what they consider an illegal assault on their vested rights.

While polling suggested that securing pension reforms would be a wash in terms of voter support for a new tax, Reed said the city would have better success in getting it passed if the money would restore services rather than just cover growing pension costs.

Kalra has opposed the mayor's pension reform approach, but on Tuesday he agreed that new taxes won't fix the city's pension woes.

"I don't think any of that takes away from our need or desire to deal with the pension issue," Kalra said.