KINGMAN – Ratification of the increase in the Transaction Privilege Tax, or sales tax, is going to be a “pretty straightforward process,” city attorney Carl Cooper said at Tuesday’s City Council meeting.
Council is being asked to consider three separate actions at its Jan. 30 meeting to come into compliance with the Attorney General’s Office regarding proper notification of action taken Aug. 15.
The AG determined that Council violated the state’s open meeting law by designating a 0.5 percent increase in the TPT tax to capital improvement projects, specifically proposed I-40 interchanges at Kingman Crossing and Rancho Santa Fe Parkway.
The City has scheduled a town hall meeting for 5:30 p.m. Tuesday at the County Administration Building, 700 W. Beale St., to hear public comment about the TPT increase, along with the possibility of requiring a supermajority vote for future tax increases and implementation of a “big-ticket option.” Comments will be limited to three minutes.
The town hall was not required by the AG to comply with ratification, but was requested by Council to get additional input on the tax, Interim City Manager Jim Bacon said.
Councilwoman Jen Miles said she was surprised that Bacon would not be giving a presentation on the budget situation as he did Jan. 9 in a five-hour workshop in which he and Finance Director Tina Moline went over 78 informational slides.
Bacon said he wanted to maximize time for public comment.
Councilwoman Vickie Kress said it was also her understanding that Bacon would have a subset of the slides to present at the meeting, and Councilwoman Jamie Stehly recalled that Council had talked about a handout of the slides.
Bacon said he would put together a handout with about 10 of the slides that showed demographics such as population, unemployment, past tax revenue collections and budget projections.
The Council also discussed a recommendation from Bacon to implement a supermajority vote (six out of seven Council members) for future tax increases at Tuesday’s work session.
“It was the people’s understanding that the TPT increase was for roads, and none of it went to roads,” Councilman David Wayt said. “My understanding is the supermajority vote would protect against something like that.”
Kress wanted to know if a supermajority vote means the Council can implement the vote right away as “emergency action.”
Cooper said the TPT vote would not be an emergency action, as far as he’s concerned, and Council would have to define some kind of emergency.
“All we’re doing is ratifying something that’s already taken place. There’s not an emergency based on that,” he responded.
In framing his idea behind recommending the supermajority vote, Bacon said it’s not about responding to the initial adoption of the TPT tax increase, but responding to future Councils redirecting those revenues from one purpose to another.
“That’s the basis that led me to support the supermajority and there’s nothing at all to prevent Council in the next two to three weeks from simultaneously ratifying the decision from Aug. 15 and adopting an ordinance for supermajority,” Bacon said. “I just want to make sure the supermajority vote doesn’t magically get in front of the ratification vote.”
“So with a supermajority, we’re looking to impose restrictions on future Councils that we’re not willing to impose on ourselves,” Mayor Monica Gates commented. “It isn’t just about redirecting tax dollars, it’s also about raising new taxes.”
If the Council adopts the TPT ratification and a supermajority vote within the next two weeks, it would obligate the Council to a supermajority vote for the balance of their term, Bacon said.
The interim city manager said he would be “very aggressive” in drafting the ordinance so that it would apply to any dedicated source of revenue.
Councilwoman Stehly said that’s one of the concerns she’s heard from the public.
“It seems like it would make them feel at ease that their money will always be spent with the intent of the Council,” she said.