Sales Tax Hike Expected To Fuel Vallejo’s Recovery

VALLEJO (KCBS) – The City of Vallejo is no longer in bankruptcy, and now a sales tax increase which goes into affect April 1st is expected to generate millions more dollars.

Once faced with deep service cuts, layoffs and reductions, the city of Vallejo is now forging ahead economically stronger than it was just a few years ago.

”The voters in Vallejo passed a one-cent sales tax in November of last year, which goes into effect on April first,” said Assistant City Manager Craig Whittom. “It will generate approximately $9.5 million each year.”

Whittom said that the city council must now decide how to allocate all of this money.

”They are general funds, so they can be used for any legal municipal purpose,” said Whittom. “That includes such things as restoring reserves or increasing services.”

KCBS’ Dave Padilla Reports:

Vallejo city officials developed a 5-year business spending plan as they exited bankruptcy court. They said that even with this new revenue stream it still could be some time before the city is on firm financial ground.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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