Penny for your thoughts

Posted Wednesday, August 22, 2007, at 8:14 PM

From today's Gazette article:

Sales Tax Ballot Committee Favors 10-year Sunset

"The sales tax ballot committee is coming closer to drafting language for the upcoming election concerning the renewal of the city sales tax.

The McCook City Council appeared enthusiastic about the committee's proposal to have the ballot include extending the one-cent tax to 10 years with a sunset at the end of that period.

Councilman Kircher also asked if the ballot committee had discussed language concerning raising the sales tax another .5 percent from its current one percent."

Did everyone get that? Not only does the sales tax ballot committee want us to vote to renew the one-cent sales tax, they want to raise it another .5 percent, making our new sales tax seven percent. Now, before we all start rubbing our hands together at the idea of how we're going to spend all that extra tax revenue, here are a few things to consider:

1. I'm going to quote former gubernatorial candidate Dave Nabity: "We cannot tax our people into prosperity." We have many wonderful businesses in our town, and I've spoken with people from Holdrege who said they love Norris Street shopping. But many small towns are just as close or closer to Kearney. A higher sales tax risks chasing away business.

2. Our current sales tax is 6.5%. Omaha's sales tax is 7%, but Omaha has more to maintain. When I lived in Forth Worth, TX the sales tax was 8.5%, but there is no state income tax in Texas. How does our sales tax compare to other towns about the same size as ours?

3. How much of that one-cent sales tax goes to pay for all those large signs around town that say things like, "J Street Improvements made possible by your one-cent sales tax."? I'm being facetious here, but I can't help thinking those signs might be evidence of some other poor budgetary decisions.

4. The theory in McCook was that the one-cent sales tax was to give us some property tax relief. Great theory, but most people I know had valuations that went up. My recent escrow statement for our home mortgage showed a projected shortage, which means our new mortgage payment will go up. Hmmm…good thing we've had that one-cent sales tax to help us out with our property taxes!

5. Here's another tidbit from the article: "Although one fourth of the .5 percent would go to economic development, Kircher questioned where the rest be spent." Where the rest would be spent--in deed, but also HOW is one fourth of that .5 percent going to economic development? I want an actual plan, here. Are they going to make loans or grants available for small businesses? Are they going to offer tax breaks for larger companies to come to McCook, making more jobs available here? Don't give me promises; give me a plan.

We had a great discussion on books last week, so friendly readers, let's hear your two cents (or 1.5 cents) on the sales tax debate.

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Was this my doing? Did I open a large can of worms with my last blog? I hope so. If nobody opens there mouths about things that bother us, then nothings would ever change. I know you can't please everybody but there are those who refuse change just because they have an aversion to learning something new. Thanks Lori!

-- Posted by amystrauch on Thu, Aug 23, 2007, at 8:09 AM
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Your welcome, Amy! If the tax debate gets too boring, I'll move on. I'm just a little fired up about this right now, because the one cent tax was supposed to be temporary. It's kind of like in big cities when they start a tollway just until they can pay off the new stretch of highway. Then the city finds they've got a good thing and they just find more projects to justify the tollway, and it never goes away. We've got to hold our local government to the same fiscal responsibility and accountability that we grumble about with our Washington politicians. Thanks for chiming in, Amy! I think getting fired up about these kinds of debates shows that we care about our community, and that we're committed to staying. Fight the brain drain! :)

-- Posted by shoma74 on Thu, Aug 23, 2007, at 9:23 AM
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Lori - I've been doing some review of this topic and wanted to share with your readers.

First I went through a Nebraska city 2000 census and circled every town with a population close to McCook's (pop. 7,994). I included every town with a population from 4,163 (Cozad) to 11,925 (South Sioux City). There were a total of 22 communities circled. Then I compared that to the April 1, 2007 city sales tax chart. Every single one of the cities in our population range had a 1 to 1.5 percent city sales tax. 1.5% included Alliance, Beatrice, Blair, Ceresco, Cozad, Elkhorn, Fairbury, Falls City, Gering, Holdrege, Lexington, Nebraska City, Ralson, Sidney, South Sioux City, Wahoo, and York. 1% included Crete, Plattsmouth, Schuyler, Seward, and Wayne. None of the cities in our population range were without city sales tax revenues.

Check out this website: http://www.revenue.state.ne.us/question/sales.htm. It lists all Nebraska cities with a city sales tax. You will find 4 Nebraska communities tax at a rate of .5%; 59 at the rate of 1.5%; and 103 Nebraska cities tax at a rate of 1%.

McCook will be at a definite disadvantage if we do not have funds specifically designated to promote and improve our community. With real estate tax, voters do not get to designate funds, they have to rely on a city council or county board to approve those funds in their budget.

According to our unscientific online poll, 51.5% of the voters (170 votes) said that an increased sales tax would affect where they chose to shop. 48.5% (160 votes) said it would not affect their choice. Voters have the opportunity to leave comments on the poll site. Those comments aren't available for everyone to see (yet), but here are some of the comments left on the poll site:

* I don't think anyone minds paying a little more in tax; they just get tired of the government wasting the money. Jim

* If we have a Sales Tax then the water rates need to be roled back to 2005 rates.

* I live 12 hours away.

* Those who do not own property in McCook but use the cities services should help with the cost to maintain those services.

* tax,s are to high.

* THERE IS ENOUGH TAXES!!! aND YOU WONDER WHY? EVERYONE WANTS TO GO OUT OF TOWN SHOPPING!!!!!!!!

* We have too many taxes already. We had none before WWII.

* I certainly hope Mccook economic developement can recieve funds so we can move Mccook forward in renewed growth.

* Just once, can a 'temporary' tax be allowed to actually expire, without the temporary becoming permenant, as well as inflated?

* I would drive to North Platte to purchase items, rather than going to McCook.

I think this is an important issue for the future of McCook and we should be seeing a lot of dialog on this issue. Thanks for bringing it up Lori.

Shary Skiles, Publisher

McCook Daily Gazette

-- Posted by Publisher on Fri, Aug 31, 2007, at 10:48 AM
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Thanks, Shary! I appreciate the website link, and I will definitely check that out. From your study it seems that our sales taxes are in the right ballpark, but I wonder sometimes if we couldn't think outside the box. What would happen if the city of McCook decided to advertise to other towns that we have a lower sales tax here? Maybe nothing. But a little marketing brainstorming never hurts. For example, the "on the bricks" campaign for the Norris Street shops was a great sales campaign that increased that "top of mind" awareness for local businesses. And I would not object if our sales tax revenue was allocated to "shop local" ads in lieu of those "Street Improvements made possible by your one-cent sales tax" signs.

-- Posted by shoma74 on Fri, Aug 31, 2007, at 11:50 AM
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