Sierra Madre OKs Utility Tax

A 6% utility tax has been given final approval by the City Council.

The tax on water, gas, electric and phone bills will cost the average resident $9.35 a month when it appears on bills beginning in November, city officials said. The rate will be reviewed annually until the tax measure expires in five years.

Officials say the tax, approved Tuesday, will generate $400,000 in 1993-94 and $600,000 annually in subsequent years. It will be used to close a $400,000 to $600,000 deficit in the city’s 1993-94 budget, officials said.

Council members postponed a decision until their next meeting on setting a maximum rate for businesses to pay.

The City Council at its last meeting ordered an audit of Sierra Madre accounts after residents charged that the city had been operating with a budget shortfall for the last five years. City Manager James E. McRea said city officials had done nothing illegal and only borrowed $1 million from the city’s Community Redevelopment Agency.