The Rancho Mirage City Council last week voted unanimously to put a special measure on the November ballot asking residents whether to raise the local sales tax rate by 1%, which would bring the city’s tax rate to 8.75%.
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“The city of Rancho Mirage historically maintains balanced budgets and fiscally sound policies while providing public services, infrastructure maintenance, public safety, parks and other municipal services,” Kofi Antobam, director of administrative services, said at the July 16 meeting. “In the past few years, the city, like many other municipalities, has experienced increasing costs associated with public safety services, infrastructure maintenance, insurance, labor costs and many other costs.”
According to Antobam, the cost of sheriff and fire services in the city have increased by more than 56% and insurance costs have more than doubled over the last four years. By fiscal year 2028, he estimated, the city would bring in less money than it needs to maintain current service levels.
“Several cost control measures have been implemented by the city, including reducing staffing levels over the last three years by approximately 11%, pursuing state and federal grant funding opportunities, and renegotiating contracts where possible,” Antobam said. “Spending priorities and operational efficiencies are continuously reviewed to control rising costs.”
About half of the city’s general fund revenue comes from transient occupancy tax and sales tax, which is currently set at 7.75%, lower than the majority of cities in the county, according to the California Department of Tax and Fee Administration.
“Of the 7.75% sales tax rate, 6% goes to the state, 0.75% goes to the county, and the city only receives 1% of that,” Antobam said, adding that nearly 75% of sales tax revenue generated in the city is paid by tourists and visitors, not residents.
At the meeting, one person spoke against the sales tax measure, sharing his concerns that if this were to pass, it would decrease transparency in the city and increase what he considered “excessive spending,” by the council.
Mayor Pro Tem Michael O’Keefe, addressing concerns about how the council allocates money, specifically when it comes to community programs, said those programs are what make Rancho Mirage a great place to live.
“Our commitments are to safety, to infrastructure, to fiscal responsibility, to culture, to compassion and to opportunity,” he said. “These are the hallmarks of our quality of life.
“They are the pillars of our identity as a community,” he continued. “When we invest in these programs, we are not wasting money, we are protecting the values that make Rancho Mirage a community of excellence.”
If a majority of voters approve the increase on November 3, the new rate of 8.75% would generate an estimated $7.5 million in additional general fund revenue for the city, according to Antobam.
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