Sales Tax Issue May Go To Ballot

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Economic development, street maintenance or fire control and EMS districts are among the options should Friendswood make use of its half-cent of sales tax still left on the table.

City council is looking at assembling a citizen’s committee, and the issue could go before voters as soon as May, though more likely next November, city officials said.

According to the State Comptroller’s Office, most Texas cities make full use of the maximum sales tax of 2 percent, or 8.25 percent when combined with the state’s sales tax rate. Friendswood, however, boasts a sales tax rate of 1.5 percent. A representative from the State Comptroller’s Office emphasized during a 2013 presentation that getting the remaining half-cent is a virtually painless way to generate more revenue. Shoppers simply aren’t going to go elsewhere because of a half-cent difference in tax, economic development analyst Russell Gallahan pointed out during that workshop.

The issue arose again during recent budget planning, and council members tend to agree that a consumption tax is money that could offset the burden on taxpayers.

With an estimated revenue of $1.5 million, a quarter-cent sales tax would generate $750,000 for street maintenance, Councilman Billy Enochs pointed out. “I would hope three quarters of a million dollars would keep us in pretty good shape, and keep us from going out and having to do these $10 million bond elections to bring our streets up to snuff,” he said. “The nice thing about this is it will improve things that citizens outside of Friendswood utilize. Pearland, League City, Alvin, Webster citizens use our streets. They use our parks. And they pay about 40 percent of our sales tax. This is a way to get some money from those folks who are benefitting from services and get them to help us pay for them.”

While regulations over how the funds can be used are complex, there are many options available.
“There’s another option that we already take advantage of, and that’s sales tax for property tax relief that was passed a number of years ago,” Roecker said. “There’s also a crime control and prevention district option. I don’t think we’re going to be any venues or stadiums, but there is that option.”

“If we want to present this to voters, we probably have to decide by January or so if we wish to have it on the May ballot,” Councilman Pat McGinnis said.

McGinnis and Councilman Jim Hill both liked the idea of a quarter cent going to street maintenance and fire/EMS.

Hill recommended forming a committee and choosing wisely in order to get voter approval. “I know streets would be a great way to use that money,” he said. “They are getting older every year.”

“If we do want to go down this route, I suggest we take a page from what we did a year ago and get a citizen’s group together and have them advise us,” Councilman Steve Rockey said.

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