Photo courtesy of City of Kingman video
Finance Director Tina Moline, left, and Interim City Manager Jim Bacon at a special session Tuesday.
Originally published Wednesday, January 10, 2018 at 06:00a.m.
KINGMAN – The schedule has been set to ratify an increase in the city’s sales tax and its designated use following a finding by the Attorney General’s Office that City Council’s previous action was approved in violation of the state’s open meeting law.
Council met for a special session Tuesday, discussing the 2018-2019 budget in the morning and ratification of the Transaction Privilege Tax rate in the afternoon.
Interim City Manager James Bacon said he’ll put the ratification on the work session for the regular agenda on Jan. 16, and expects to schedule a town hall meeting for public input on Jan. 23, though that date could change depending on where the meeting is to be held. The location was not determined at Tuesday’s meeting.
City Council would then hold a special meeting on Jan. 30 to ratify the sales tax vote, with proper meeting notice language.
The AG Office found the Council in violation of the open meeting law because the tax was designated for “pavement preservation,” and was changed to “capital improvement projects,” specifically funding two interchanges on Interstate 40. The City has 30 days from the date of the Jan. 2 letter to fix the problem.
Councilman Travis Lingenfelter said he wanted to include information on budget projections at the town hall. That would include sales tax revenue projections with the “big-ticket item” provision that would keep the tax at 2.5 percent for purchases over $5,000 or $10,000, whatever the Council might decide.
“I’m all for the workshop, but let’s do it right,” Lingenfelter said. “Big-ticket retailers say they’re being harmed. Where’s the data to support that? We need that data.”
Vice Mayor Jen Miles said she’s heard anecdotal stories of people going to Bullhead City or Las Vegas to purchase new vehicles after the tax increase took effect in November, but Bacon said sales tax reports lag by two months, so he won’t know November’s tax revenue until late January. Even then, it would need to be tracked for several years.
Finance director Tina Moline estimated that the increased TPT would generate $3.1 million in revenue and allowing for big-ticket items to be taxed at a lower rate would reduce revenue by about $300,000.