City eyes tax extension vote
Special sales tax may fund capital improvements
The soon-to-expire HEART sales tax was so successful as a funding mechanism for city quality of life improvements that commissioners are considering extending it for another purpose.
City Manager Dave Slezickey proposed to commissioners last week that they consider calling for a vote to extend the one-third cent tax, currently due to expire next September.
At the encouragement of commissioners who seemed unanimously favorable to the idea, Slezickey and City Attorney Jared Harrison will work together to prepare a couple of proposals for the December meeting.
The fi ve-year tax, which started as a half-cent for three years and then dropped to one-third cent for the last two years, funded a multimilion-dollar rehab of the Vernie Snow Aquatic Center, Kingfisher Trails maintenance and other city improvements.
Slezickey’s suggestion is to continue the tax indefi nitely and dedicate it to capital improvement projects.
Unlike counties, which are funded by property taxes and also have the authority to call for sales tax elections, city governments don’t receive property taxes and rely on sales taxes to fund most of their operations.
“I’m not one to increase taxes, but people need to understand that right now we’re operating on two and one-third cents,” Mayor Steve Richards said.
“The other cent we collect goes to the hospital, so nearly a third of our sales tax revenue comes right off the top. We have to find a way to work around that.
“This would give us a mechanism to provide a stable, longterm money source.”
The 25-year hospital tax, approved by voters to fund the construction and financing costs for the new hospital, now leased to Mercy Hospital, is set to expire in 2034.
In his written report to the board, Slezickey said that the two cents of tax not specifi - cally allocated provides for all city services, including police, fire and ambulance, parks, cemetery, library, planning, administration and streets and drainage.
A resolution calling for a sales tax vote would have to be approved 75 days in advance of the election date when it would go on the ballot, Slezickey said.
“If it replaces the HEART tax, then we won’t have a change in the sales tax rate,” he said. “If we do it perpetually or permanently, then we don’t have to worry about timing issues when we need to borrow funds for larger projects.”
Some of the projects on the city’s capital improvement list include enlarging the current fire station, renovating city hall, resurfacing Will Rogers Drive between 13th and Main streets, among others.
“We have a lot of funding needs out there that we don’t have the funds to take care of,” Richards said.
Slezickey said the dedicated sales tax revenues would be placed in a special fund and the city commission would still have to approve any expenditures.
Commissioner Roxie Alexander asked about calling for the tax at the half-cent rate where the HEART tax originally started.
“A half-cent would allow us to do more things faster, I agree,” Slezickey said. “But we also need to consider whether a half-cent is going to be a harder sell or is just continuing the third-cent everyone is used to paying going to be easier.”
Slezickey said construction of a larger fi re station, which would allow all the equipment to be housed in one location as well as accommodate a crew that has tripled in size, would be the first funding priority.
In response to a question from Commissioner Tammy Mueggenborg, Slezickey said the plan is to keep the current Main Street location and construct a two-story structure to maximize the space.
“The location is ideal since it sits on top of a hill, with great visibility and easy access to U.S. 81,” he said. “All the new construction is happening to the south, but the station is closer to the older residential neighborhoods and to downtown, both of which are at higher risk of fi re.”
Commissioners will look at several sales tax proposals at next month’s meeting.