The half cent sales tax proposal will be on the Aug. 14 agenda. In preliminary discussions on the issue during budget workshops, the council tweaked an earlier management proposal, which can still be changed prior to authorizing any public vote in November.
The funding is projected to collect approximately $10 million over the next 10 years and has been identified for infrastructure improvements for streets, swimming pool, golf course irrigation system, storm water drainage and parks.
Specifically the preliminary proposal put forward by the council for further discussion includes:
* 50% of funding would go towards Street Improvements, estimated to generate an average of $500,000 annually or $5 million total over 10 years.
* 30% of funding would go towards the construction of a new Swimming Pool, estimated to generate an average of about $300,000 annually or $3 million over 10 years.
* 12% of funding would go towards a new irrigation system, water pumping units and other infrastructure improvements to Hillside Golf Course, estimated to generate an annual average of $120,000 annually or $1.2 million over 10 years.
* 5% of funding would go towards storm water mitigation projects working through an inter-local government agreement with the South Platte Natural Resources District to alleviate flood prone areas in Sidney, estimated to generate $50,000 annually or $500,000 over 10 years.
* 3% of funding would go towards Parks infrastructure improvements, such as lighting or restroom facilities
Several stipulations are part of the half cent sales tax bill, including replacement of some other current funding fee and helping fund an inter-local government agreement. The council is proposing eliminating a 1 percent restaurant occupation tax city wide that currently generates approximately $150,000 annually.
In the 2012 Nebraska Legislative session, an additional half cent sales tax was authorized for municipalities specifically for infrastructure purposes. This was adopted by the narrowest of margins to override the Governor’s veto of LB 357. The Council would need to adopt a resolution authorizing the public vote no later than its Aug. 28 meeting in order to meet the September 1 deadline to make the general election ballot.
The only other obvious funding option the council has to address the city’s infrastructure needs would be increasing the property tax allocation. Currently the City is 34 percent below its property tax lid requirement.
Currently a half cent sales tax would generate approximately $800,000 to $900,000 annually. The ballot issue is for a 10 year period of time, or lifetime of a bond issue. The City believes over 10 years this fund could generate $10 million as the community continues to grow.
This particular half cent sales tax option can only be voted on at primary or general elections so this is the only opportunity the city has to give the public an opportunity to vote on it prior to 2014.
The ballot authorization must be approved by 70 percent or super majority of the city council members or by at least 4 of the 5 council members to move forward to the election process.