Supervisors OK Temporary Fix For Countywide, Sebastopol Tax Hikes

SONOMA COUNTY, CA — The Sonoma County Board of Supervisors approved a stopgap measure this week that will allow two voter-approved measures to increase sales taxes countywide and in the city of Sebastopol on April 1, 2025.

The temporary solution will allow the County to fully implement Measure I, a countywide quarter-cent sales tax approved by 62.81 percent of Sonoma County voters last month to fund child care, education and health care for children in low- and middle-income families. The action will also enable the City of Sebastopol to phase in implementation of Measure U, a half-cent city sales tax approved by 72.01 percent of Sebastopol voters last month to address the city’s budget challenges.

The California Department of Fee and Tax Administration, the state agency that administers sales taxes, opined that neither tax could be implemented because, when combined, they would push the sales tax in Sebastopol above 10.25 percent —the maximum currently allowed in Sonoma County by state law.

While the CDTFA said it could not implement either tax without a legal opinion from the California Attorney General’s Office or a solution from the California Legislature, it did suggest to the county and city that the taxes could be implemented if an agreement was reached between the two jurisdictions.

"Voters in Sonoma County and the City of Sebastopol want to tax themselves to pay for causes they believe are worthy, and we should respect those decisions," said Supervisor David Rabbitt, chair of the Board of Supervisors. "This temporary fix will allow the County and the City of Sebastopol to execute the will of voters while we work on a legislative solution to allow full implementation of Measure I and Measure U."

An agreement between the County and the City of Sebastopol will temporarily keep the city’s sales tax from exceeding the maximum rate of 10.25 percent, allowing the Measure I sales tax to take effect countywide. Under the agreement, the City of Sebastopol will seek to phase in Measure U, temporarily collecting only a quarter-cent of the half-cent sales tax approved by city voters. In exchange, the County of Sonoma will make Sebastopol whole by paying the city an amount equal to the portion of the Measure U tax temporarily waived by the city.

Staff for the County, the City of Sebastopol and First 5 Sonoma County, the local agency administering Measure I tax proceeds, are seeking a permanent solution from the Legislature that would allow Sebastopol to fully implement both Measure I and Measure U.

The Sebastopol City Council meets Tuesday and will review the temporary solution. If approved by the city, the sales tax in Sonoma County and Sebastopol will increase April 1.

It could take up to six months for the California attorney general's office to issue a legal opinion on the matter as requested by the California Department of Fee and Tax Administration. The county payments, estimated at approximately $62,500 a month, will continue until the attorney general shares their findings or a legislative fix is received.