Cupertino Matters

Festivals abound in October. On Saturday, October 14, join our community at the annual Bay Area Diwali Festival of Lights, celebrating its 20th anniversary in an improved Memorial Park. There will be lots of cultural events, food and activities from 11 am to 6 pm.

The city of Cupertino faces financial challenges due to a state audit of sales taxes by the California Department of Tax and Fee Administration (CDTFA), which reexamined an agreement between the city and a major sales taxpayer. The city is expecting the state to demand repayment of affected sales tax revenues dating back to April 2021, so staff is recommending setting up a $56.5 million Sales Tax Repayment Reserve to cover the potential liability. The monies would be pulled from the Unassigned Fund Balance of the General Fund as well as the Capital Projects Reserve and Economic Uncertainty Reserve. This article entitled Cupertino Reserving $56.5 Million to Repay Tax From Apple Sales from Bloomberg Law provides background. There is a similar article in Apple World Today 

All cities in the state were tasked with developing Housing Element (HE) plans to facilitate increased housing production and affordability. Cupertino’s share is 4,588 net new homes for the next 8 year cycle beginning Jan. 31, 2023. The city submitted its first draft on Feb. 3, 2023, which the state Housing and Community Development (HCD) sent back for revisions. A new consultant was hired and staff has diligently worked to revise the plan.

The revised Draft Housing Element is now available for public review on the City’s website at engagecupertino.org/public-documents. The City will resubmit the Second Draft Housing Element to HCD for review on Monday, October 16. The 62-page revised HE plan is dramatically more robust than the initial draft with extensive improvements regarding land use goals, policies, and procedures. It also now includes quantifiable objectives which were missing in the first draft. This revised version is more likely to be approved by HCD, so Cupertino can start making the necessary changes to increase the housing stock so desperately needed by our community. This process is iterative and may take an additional pass from HCD given how poor the first draft was.

In school news, on Oct.17,  the Fremont Union High School District (FUHSD)  will hold its next meeting regarding development of the trustee map for district-based elections (rather than the current at-large elections). The initial map will be developed by consultants to meet basic legal requirements. This draft will constitute the baseline for developing alternative maps from the community. Information and updates can be found at https://www.fuhsd.org/newsroom/trustee-areas Note that this process does not affect school attendance boundaries.

UPCOMING – CITY COUNCIL – Tues, Oct. 10, 6:45 p.m., Special Meeting for rescheduled Oct. 3 Regular Meeting

Agenda and Presentations 

Ceremonial Items are (1)  Recognition of October as Hindu Heritage and Awareness Month. (2) Recognition of 2nd week of October as Code Enforcement Officer Week, and (3) Silicon Valley Clean Energy (SVCE) Electric Showcase Award honoring Cupertino resident winner.

The Consent Calendar has seven routine items. Note that Item No 5: Updates to the Policies and Guidelines on Sister Cities, Friendship Cities, and International Delegations may be pulled and heard at the end of the meeting. Members of the public may speak on any or all consent calendar items when the mayor asks for public comment on the Consent Calendar. If a member of the council pulls an item from the Consent Calendar, it will be addressed after all action items. Members of the public may comment on that item when it is considered.

There is a single action item:

Item No.11:Establish a General Fund Sales Tax Repayment Reserve.  As referenced above, the purpose of this reserve is to set aside funds for potential sales tax repayments through the California Department of Tax and Fee Administration (CDTFA) as a result of an ongoing audit of a major Cupertino sales taxpayer. Staff is proposing an initial allocation of $56.5 million, corresponding to sales tax revenue received between April 2021 and June 2023 that the City may need to repay. The city may owe more money as additional sales tax revenue is received by the City. To address this, staff recommends that the City Council grant staff the authority to augment this reserve as needed when additional disputed sales tax revenue is received.

The reserve is proposed to be funded as follows:

  •  $40.5 million from General Fund Unassigned fund balance.
  •  $10.0 million from the General Fund Capital Projects Reserve.
  •  $6.0 million from the General Fund Economic Uncertainty Reserve.

Impact on city operations remains under discussion.

Council Reports (now submitted in written form) were provided by all council members.

Informational Items: None.

CUPERTINO COURIER: October 6,  2023

The front page photo and article on page 5 is entitled Ear-resistible art: 38 fiberglass rabbits headed for the auction block to raise money, a project sponsored by the Cupertino Rotary Club to celebrate the Year of the Rabbit. Page 5 has an article entitled Cupertino high school students are among National Merit semifinalists. Community briefs are (1) Advocating for foster youth and (2) Valley’s haunted history.  There are no legal notices.

Warm regards,
Jean Bedord
Cupertino Matters
Publisher and Editor