City Commission Discussion Materials: Aug. 27, 2007
Support for a new citywide sales tax is continuing to grow inside City Hall.
On Friday, the list of commissioners expressing support for some type of new sales tax grew to four. Commissioner Rob Chestnut said he's convinced that the city needs a new revenue source, and believes that a sales tax would be fairer than a property tax.
"I'm looking at property owners here, and they have seen a very rapid increase in costs over the last several years," Chestnut said. "A sales tax does start to spread the costs to folks who may not be residents here."
That leaves Commissioner Mike Dever as the lone commissioner expressing skepticism about the need for a new sales tax.
"I still believe the city needs to do more looking within before we start asking the community for new money," Dever said. "I really believe that."
A half-percent sales tax is estimated to raise between $5 million and $6 million per year. Any new sales tax, by state law, must be approved by voters in a citywide election.
Commissioners are scheduled to have their most detailed sales tax discussion yet at a study session at 4 p.m. Monday at City Hall.
Much of the discussion may center on what a new sales tax should fund. Commissioners are far from a consensus on that issue. Commissioner Mike Amyx previously has proposed a half-percent sales tax that would sunset after five years. It would be used to fund street and sidewalk repairs, and new infrastructure projects designed to make the city more attractive to new companies.
But in recent days, commissioners Chestnut, Boog Highberger and Mayor Sue Hack have said they want to see if there were room to add at least one "amenity project" onto the list of items to be funded by a sales tax.
Highberger is pushing for it to be a new downtown library project, while Chestnut and Hack said they would consider either the library or a proposal to add recreation facilities to the community.
On Friday, Highberger added a twist to the debate. He said perhaps the city should be considering not one but, rather, two sales tax proposals. Highberger said he wants to explore a small sales tax - something less than a quarter percent - that could be used to fund construction of a new library.
Unlike Amyx's proposal, the second sales tax would not sunset after five years. Instead, it would be permanent, or last at least 30 years to pay for the library bonds. Highberger said the commission could put that sales tax question on the ballot in addition to the infrastructure sales tax proposed by Amyx.
Voters could choose to support both, one or none.
"I think we need to prioritize our needs and give them to the public and let the public give us a thumbs up or thumbs down," Highberger said. "But I feel like we need to put something before the voters on the library soon."
Hack said Highberger's idea of two separate ballot questions was intriguing.
"That could be a good compromise," the mayor said.
It would not be one that would sway Dever. He said if he ultimately does decide to support a sales tax, it would need to be for infrastructure and for economic development purposes.
"The only way I would feel comfortable supporting a new sales tax is if it would be used to take care of what we already have, and to attract new businesses that could help take some of the financial burden off the existing community," Dever said.
Chestnut said he still wants more information on how many projects a half-percent sales tax could support. He said he wants to add an amenity project, but only if it doesn't short-change needed street and infrastructure improvements. Chestnut said he's not sure an amenity project needs to be added in order for a sales tax to win voter approval.
"Our last city survey showed that infrastructure is on everybody's mind," Chestnut said. "People want their streets to be better. I think a sales tax that accomplishes that could receive a lot of interest from the public."