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Goal 2: Maintain and Enhance Pleasanton's Fiscal Revenues The vitality of a community's businesses directly impacts a City's ability to maintain high quality municipal services, which in turn affects residents' quality of life. Like many cities across California, Pleasanton has faced financial challenges in recent years in maintaining sufficient General Fund revenues to meet rising expenses and continue to provide excellent services to residents. Given California's tax structure, it is critical to both residents and employers that the City maximizes its revenues, using local economic development as a key approach. The single largest portion of the City budget is the General Fund. In Pleasanton's General Fund, two of the City's larger revenue sources -sales taxes (from both retail and business-to-business sales) and hoteltaxes -account for more than 28 percent of total revenues at present. Both of these important sources of General Fund revenue decreased from their historic highs experienced in the early part of this decade. For example, hotel tax revenues to Pleasanton's General Fund declined from a peak of almost $4 million in FY 2000-2001 to just $2.5 in 2003-2004. Tax revenues from sales (both retail-to-consumer sales and business-to-business sales) declined from a peak of $21.3 million in 2000-2001, to $17.3 million in both fiscal years covering 2001-2002 and 2002- 2003. More recently, as a result of the strengthening economy, tax revenues have been gradually increasing and are projected to be $19.6 million in fiscal year 2005-1006. At the same time, residents and businesses expect continued excellence from city staff and services, although the rising costs for personnel, utilities, etc. must be considered. For example, the City of Pleasanton General Fund expenditures will increase by 15 percent ($10 million) above just the two-year period from 2003-2004 to 2005-2006. The trend of declines in tax revenues and increases in expenditures can dramatically affect the City's ability to fund services and maintain the overall quality of life for its residents. Thus, this goal addresses the relationship between business vitality, economic development, and the key General Fund revenue sources of taxes from sales and taxes from hotels. Policies: Policy 2.1: Attract new retail sales tax revenue-generating businesses to Pleasanton. Policy 2.2: Enhance the City's Business-to-Business ("626") sales tax revenue. Policy 2.3: Examine opportunities to increase the City's Transient Occupancy Tax (TOT) revenues through increases in occupancy and creation of new higher end lodging facilities. 18