Mare Island property owners ask Vallejo council to end special tax for police and fire services

VALLEJO – Property owners on Vallejo’s Mare Island asked the City Council at Tuesday’s meeting to end a special tax on island landowners that funds  police and fire services in order to bring their tax rate in line with what property owners in the rest of Vallejo pay.

The Mare Island property owners have been urging the council to reduce their Community Finance District (CFD) taxes for several years.

The CFDs were created over 20 years ago to fund police, fire and other public services and infrastructure after the U.S. Navy left Mare Island. At the time, the Lennar corporation wanted to build homes on the island but the city did not want to pay for the additional costs to provide services to the new residential development.

But Mare Island property owners with the Mare Island Special Tax Elimination Alliance say that the taxes levied on the 320 residents of Mare Island in addition to the regular property, sales and other taxes that are collected throughout the City of Vallejo do not accurately reflect the city’s cost to provide police and fire services.

Alliance member Daniel Boone said that the CFD taxes were set up based on the Navy’s estimate of their costs to run police and fire on the Island, which was $5 million. But, he said, those costs were for a fully staffed police department and three fire stations dedicated to Mare Island. Boone claims that this original estimate created a faulty CFD structure and Mare Island residents have been overcharged for police and fire services for 20 years.

Dan Glaze, another alliance member, said that according to his estimates the owner of a $500,000 home in mainland Vallejo would pay $291 dollars a year for police and fire services while a homeowner on Mare Island with a property of equal value would pay $2,652 annually for police and fire.

Glaze said that over the 20 years that the CFD’s have been active, Mare Island residents have paid $56 million for police and fire services in addition to property taxes and sales taxes.

Mare Island residents, including many of the presenters at Tuesday’s meeting, have been regularly coming to city council meetings over the past year to express their grievances with the CFD tax structures.  

In response to the regular appearances from the residents council requested a report from city staff on Mare Island’s CFDs. That report was presented by staff at the April 25 meeting.

Assistant City Manager Gillian Hayes said that in the interest of working with Mare island residents, the city froze one of the CFDs, providing the homeowners with between $300 to $400 in tax relief per payment. But she said that city staff does not recommend making changes to the tax structure until the Mare Island specific plan is complete in 18 to 24 months.

“We don’t know what’s under the ground out there because the Navy once owned it,” Hayes said. “So we are trying to figure out what it is that we are going to need as far as infrastructure and services long term. To make that decision now and delete taxes when we can’t just go back and change things later could be really detrimental to any [development projects] happening out there so we just want to do it in the right timing.”

Hayes said that to make changes to the Mare Island CFDs, the council would have to approve an election and two-thirds of voters would be required to pass it. But the results could be overturned by a protest by a majority of landowners. The Mare Island Company – a company formed by a partnership between the Nimitz Group LLC and the Southern Land Company, which bought 157 acres of North Mare Island from the city last year –  owns 50% of the land in the CFDs and could block any changes by a majority protest.

Brian Nagy, senior vice president of operations at the Mare Island Company, said that the company supports the city staff’s plan to wait until after the specific plan is complete.

However, the Mare Island tax elimination alliance claimed that their proposal allows the council to provide immediate tax relief to Mare Island residents without changing the structure of the CFDs.

The alliance said that the council has the power to provide tax relief by adjusting the city budget directly instead of going through the process of changing the CFDs. On Tuesday they advocated that the city cut the entire allocation for Mare Island police and fire services, $3.3 million, from the 2023-24 budget.

The group claimed that directly eliminating Mare Island police and fire services from the budget would work with the existing CFD structure to bring their tax liabilities in line with other Vallejo residents. They pointed out that Mare Island has the lowest number of calls for police and fire services in the city.

A Mare Island resident identified only as Cynthia L. said that she has been living on Mare Island since 2017 and in that time she has called the police six times. “Not once has there ever been a response to my calls, so you just stop calling,” she said. “It’s very disturbing to me that in the event of a public emergency or something really wrong, I don’t think we are going to get a response. So we are paying for services that we just don’t get.”

Councilmember Mina Loera-Diaz, who advocated for the special meeting on the Mare Island tax issue, said that although she understands that Mare Island residents are paying more for police services, the crisis the city is facing with a shortage of police officers is not just limited to Mare Island.

Mayor Robert McConnell said that the city needs to take a look at what Mare Island residents are paying for city services and if the charges cannot be justified the city needs to consider adjusting the budget. Perhaps not all at once but possibly in yearly increments, he said.

The council directed staff to bring some options for possible reductions in the Mare Island services allocation to the June 6 budget workshop.