What the UUT and GFT Do for You

There has been a lot of discussion around town regarding the alphabet soup of City [of Glendale] finances – GFT, UUT, etc. To date, there are two lawsuits filed against the city regarding the General Fund Transfer, or GFT, from Glendale Water & Power. There is also currently an effort afoot to repeal the existing Utility User Tax, or UUT, which was last affirmed by Glendale voters in 2009.

I believe some facts and implications are in order.

The people looking to eliminate the GFT fall into two camps – one is called the Coalition for Better Government and the other is the International Brotherhood of Electrical Workers. Their contention is that the GFT is a violation of the City Charter, and that it also violates Propositions 218 and 26. The people looking to eliminate the UUT have gathered approximately 2,500 signatures to get the matter placed on the April 2015 General Municipal Election ballot. The threshold to get the measure on the ballot is about 2100+, and the remitted signatures are being verified by the L.A. County Registrar Recorder.

The UUT brings in approximately $28 million to the City of Glendale’s General Fund; the GFT is $20 million dollars. Together, these two sources of revenue are the third and fourth largest revenue streams to the General Fund, respectively. Their elimination would equate to a mammoth budget cut of 28% of the $170 million General Fund.

What is the General Fund?

The fund pays for most of the traditional local government services that Glendale residents and businesses rely on – police, fire, libraries, parks and administrative functions. Like most other independent cities, public safety – police and fire/paramedics – make up two-thirds of the General Fund. In two recent surveys (statistically valid, random sample), Glendale residents clearly indicated that they were quite satisfied with the services they received and that public safety services were their top priority. Thus, if you have to cut roughly one-third of the budget and don’t want to cut police or fire/paramedics, then that means you’d have to eliminate all of our library systems, every park and community center, all recreation and community services programming, much of our Community Development Department, and administration. In short, Glendale would cease to be the community that we know and value.

This consequence is real and yet completely manufactured by a handful of people citing a wide array of misinformation as fact.

For the record, the GFT was initially approved by Glendale voters in 1941 when the City Charter was amended to allow the practice of transferring electrical operating revenues to the City. This practice has remained unchanged since its implementation. The City does not transfer water revenue. The City does not violate Prop 26 because that measure is not retroactive and specifically allows existing transfers, like the GFT, to continue so long as their methodology is unchanged. The UUT was lowered and reaffirmed only five years ago; certainly the voting public expressed its mandate at that time.

The fact is that Glendale has weathered the storm of the Great Recession and remains a progressive leader among cities, offering exceptional customer service to its residents. The consequence of success and discipline ought not be the evisceration of programs and services that benefit the majority of our community.

Scott Ochoa
Glendale City Manager
sochoa@glendaleca.gov

  Scott Ochoa