Press ReleasePress ReleaseCity of Laguna Beach
John Pietig, City Manager

505 Forest Avenue
Laguna Beach, CA 92651
Phone: (949) 497-0704
Fax: (949) 497-0771


Subject :City Council to Let Voters Decide Sales Tax Measure in November
Contact :John Pietig    949 497 0704

Laguna Beach, CA The Laguna Beach City Council voted unanimously Tuesday to put a question on the November 2018 ballot asking voters to approve a one-cent dedicated sales tax measure to fund the undergrounding of overhead utilities along Laguna Canyon Road and other key City evacuation routes and additional related fire safety measures. 

The City Council has been working on options to address the risk of wild fire and evacuation issues since July 2015. Over the last six months, City staff has worked with the City Council Utility Undergrounding Subcommittee comprised of Mayor Pro Tem Rob Zur Schmiede and Councilmember Bob Whalen to find potential funding strategies for utility undergrounding projects. City consultants conducted two opinion surveys recently to measure community support for various options. Tuesday, the City Council was presented second survey results from 416 residents that show support for undergrounding utilities on key evacuation routes in the City and for a one-cent sales tax measure to help fund undergrounding efforts. The survey was conducted April 28th - May 6th by consultant FM3 Research. Some highlights of the survey include:

  • 75% of those surveyed agree that undergrounding utilities will greatly reduce the threat of wildfires in Laguna Beach. 

  • 76% of those surveyed agree the City of Laguna Beach is one of the most vulnerable cities in California to the threat of wildfires; and in an emergency event, downed poles and lines could make it impossible for first responders to access our neighborhoods.

  • 69% of those surveyed say action needs to be taken to address the immediate fire dangers associated with overhead power lines in Laguna Beach. 

Support for a one-cent sales tax measure remained at two-thirds of participants after all information had been provided to them.

If approved in November of 2018, revenues from the sale tax increase will be supplemented by $2.5 million dollars of existing City funding from Measure LL and Parking and Street Lighting funds, which will provide an estimated cumulative amount of $8 million of annual revenue. This funding will provide for undergrounding project expenditures and potentially the debt service of a future bond measure to be used for the planning and construction of utility undergrounding and additional fire safety measures.

“We spent a lot of time investigating the possible funding strategies,” said Councilmember Bob Whalen. “Based on the community survey, it is clear that a sales tax increase is the source most favored by residents and logically the one we should pursue.”

Undergrounding overhead utility lines to improve public safety is one of the City’s highest priorities. The location of our City and the landscape of surrounding areas make it one of the most vulnerable cities in California when it comes to wildfires and with only a few roads that allow most residents to evacuate in the event of a natural disaster. Laguna Beach has a history of fires that spread quickly and cause extensive danger and damage for residents.

The City has done extensive work over the past decade to study the most efficient and cost-effective way to expedite moving dangerous utility wires underground. Existing City revenues and Rule 20-A credits (California Public Utilities Commission credits allocated by public utilities to cities to help fund undergrounding) of $6 million dollars are not sufficient to fund undergrounding in Laguna Beach, which is estimated to cost up to $135 million dollars.

To make use of immediate existing Rule 20-A credit balances, the City Council also directed staff to establish underground utility districts on two key evacuation routes. The first is on Coast Highway between Agate Street and Upland Road, and the second is on Monterey/Virginia from West Street to 5th Avenue. These routes are prioritized because they fall on evacuation and emergency access routes and can also be undergrounded relatively quickly due to existing engineering designs already prepared for previous projects. Additionally, the City is planning to continue facilitating undergrounding assessment districts in seven other Laguna Beach neighborhoods already in progress.

“At last night’s City Council meeting, the public was provided the opportunity to comment on utility undergrounding,” said Mayor Pro Tem Rob Zur Schmiede. “After listening to all the testimony, the Council decided to provide Laguna residents with the opportunity to vote on this important community issue.”

Over the last year, multiple funding strategies to underground utilities have been researched, and survey results show a dedicated sales tax is the most viable funding option at this time.

“I think part of the reason residents are supportive is that they understand the sales tax will be paid for primarily by visitors to Laguna,” Whalen said.

City staff will prepare documents necessary for placing a sales tax measure on the November 2018 ballot and will present them to the City Council at the meeting of June 26, 2018.