Editorial: City’s sales tax debate becomes theater of unexpected

Cottonwood City Hall became the theater of the unexpected this past week.

People were showing up to City Council meetings begging that their taxes be raised. They were waving signs and actually cheerleading the idea of an increase in the city’s sales tax levy.

That means one of two things:

  • They astutely follow the workings of their local government and have a keen understanding of the fiscal challenges confronting Cottonwood City Hall.

  • Or, they’ve been played, manipulated, convinced to put on a show to ease the political anxiety naturally associated with a tax hike.

Bet on the latter.

As for the person pulling the strings for this little show, only time will tell whether it plays out as an effective political tactic.

The answer could come as early as Tuesday when the City Council is expected to vote on a bump in the city’s current 3-percent sales tax levy.

Even with this show of support during the past week, it’s only natural that council members and the mayor are apprehensive about the decision confronting them.

The major debate with any tax increase, be it on your property or as a surcharge to the purchases you make, is whether it should be decided directly by council or if it should go to a vote of the people.

In recent years in Camp Verde, we’ve seen both approaches used. In the November 2010 election, Camp Verde voters shot down propositions to raise the sales tax by 1 percent, and an accompanying measure to add an additional .05 percent for a new library.

Despite voter sentiment, the Town Council moved forward with its plans for a new library as well as increasing the basic sales tax levy.

The library now, ironically, is a source of undisputed pride in the community. But the council decision to bump the general sales tax prompted a recall effort in Camp Verde. It was of no consequence.

Likewise, one of the most vicious political cycles in Cottonwood’s history occurred when the council voted to do away with a municipal property tax in favor of a sales tax some 40 years ago.

Such history can’t help but cross the minds of council members as they contemplate their decision on a sales tax hike Tuesday.

Also, let’s not forget that this is an election year. Any vote now on a hike in the sales tax will follow, perhaps even haunt, incumbents seeking another term on the council now through November. Voters have long memories when it comes to the pocketbook implications of the decisions made by their local representatives.

Another consideration for council this week involves the city’s sales tax on food. It has been suggested to council that if the city opts to bump the general sales tax by anywhere from .05 percent to a full penny on the dollar, that they exempt groceries from the tax. It’s not an original thought, by any means. Camp Verde does not levy a sales tax on food items. And in Cottonwood, the very issue of having a sales tax on food has been challenged before via referendum.

Also to be considered by council is how a bump in the sales tax will cripple an already inflated rental market. Affordable housing consistently has been voiced as the No. 1 problem in Cottonwood, and throughout the Verde Valley. Cottonwood currently levies its full 3-percent transaction tax on rental income. A vote to hike the general sales tax is a vote to make an already problematic rental market even more burdensome for those seeking affordable housing.

There’s obviously much to think about before Tuesday’s expected vote on the sales tax.

Stay tuned.

It’s the theater of the unexpected

Comments

Comments are not posted immediately. Submissions must adhere to our Use of Service Terms of Use agreement. Rambling or nonsensical comments may not be posted. Comment submissions may not exceed a 200 word limit, and in order for us to reasonably manage this feature we may limit excessive comment entries.

MichaelMathews 4 months, 1 week ago

Very good Dan. I agree with the latter. This small group has been played and manipulated by somebody on the inside. They had their rec center pickle ball courts threatened and it created a knee jerk reaction. Nobody who has any knowledge of the budget and the last ten years spending history would agree that a tax increase should come ahead of a hard look at current spending practices and salaries. With a new council coming at the end of the year and a new city manager taking the helm in January, maybe the current council should just put a hold on any tax increase for one more year. Their handling of this first experience with being so involved in the budget process demands caution. 9.35% is high enough. 10% would be unacceptable. With this election and the next in 2020, anybody currently sitting on council better think long and hard about the other 11,000 plus residents before making any rash decisions. Particularly the 21.5% who live in poverty. The two councilors who are not running to retain their seats have already stated they would support a 1% increase. Hit and run for sure. We can do without them.

0

pinonbistro 4 months ago

Dan and Michael you both have it wrong. I'm not being played by the city staff or council. And I'm not concerned solely with pickleball or even the rec center though I support both. It was the deferred maintenance on the latter that first got me interested in finding out why. I first proposed a sales tax increase at a council work session last February when I saw that we had no savings, had a lot of deferred maintenance and some unfunded pension liabilities and other debt that needed to be paid down. The first two were caused in large part by a decline in sales tax revenues during the recession of 2008. I'm advocating a sales tax increase for prudent fiscal reasons. I agree that we need to pursue additional cost cutting measures. While some salaries are too high, namely the four contract employees which I wrote to the council members about, there are others that are too low to attract qualified people--police officers for example. Regarding postponing the sales tax increase there are many of us in Cottonwood who feel it is fiscally irresponsible to do so. If they are courageous we will support them at the polls.

0