BENTON -- Scott County voters will decide on Feb. 3 whether to waive the county portion of their real estate and personal property taxes in exchange for a half-cent sales tax.
On Thursday, commissioners voted to place the initiative of the ballot.
"I truly believe that, for the majority of people, this is a tax break," said Jamie Burger, presiding commissioner, in a meeting with elected officials and department heads to explain the initiative and hear comments.
He and other commissioners admitted that, with the current economic climate, it isn't a good time to ask for a tax increase. But for most, it will lower the taxes an individual pays over a year, as the county portion of taxes will be abated if the measure passes.
Burger said that, when a similar initiative, simply to extend the original tax failed to pass in spring 2007, taxpayers said they wanted two things: a sunset, as well as a kickback for themselves. He and other commissioners are confident this measure does both.
"The abatement will be for 100 percent of the county portion of the personal property and real estate taxes during the next eight years," said Burger. He said that a taxpayer who pays $50 in personal property and real estate taxes to the county would have to spend $10,000 on retail purchases in the county -- excluding gas and prescriptions, which are not included in the tax -- to equal that.
The waiver will not include school, road, or any other taxes. Only the county portion, listed on the second line of tax bills which residents should have received by now, will be omitted for the next eight years if the measure is approved.
Commissioners estimate the abatement will accumulate to about $400,000 annually.
Based on estimates, the tax would bring in approximately $1.6 million per year. When the amount of taxes abated is deducted, the net annual income would equal about $1.2 million, which would go into the general revenue fund. However, that amount could be higher or lower, based on spending habits.
"These are not earmarked funds," said Burger. "It will all go to general revenue to be dispersed by us as a county commission."
Commissioners have rough estimates for how the money would be spent: $800,000 for the law enforcement fund; $200,000 to support the E-911 program; and $200,000 for partial matches for grants, to begin a rainy day fund and to cover rising fixed costs in county operations such as utilities.
"We need some money in reserve, just in case," said Dennis Ziegenhorn, commissioner. "We need something in case of a disaster. I know we have insurance, but we also have deductibles."
County Clerk Rita Milam noted that, between ice storms, the flooding and lightning damage, the county had unexpected bills of about $350,000 to pay before they would be reimbursed.
"You can eat up that money really quick on another bad winter or wet summer," she said.
Burger said that, when the original ballot initiative passed in April 2000, it was two-fold -- not only to pay for the new jail facility, but also to pay for the rising cost of law enforcement.
"And that is ongoing," he said. For the past eight years, about $800,000 of the funds collected have gone to support law enforcement, as per the ballot initiative.
Burger also called 911 the county's biggest battle. "Our revenues are declining quickly and our expenditures are rising rapidly," he said. That is due to, in large part, people dropping landlines, which surcharges help pay for the service. Cellular phones have no such surcharge.
The ballot initiative ensures the abatement for eight years, no matter what the makeup of the commission.
"Regardless of who is here, they cannot raise that tax back up," said Ziegenhorn.
Burger said the situation is, in his opinion, a win-win for county taxpayers.
"Voting yes for this lowers your local taxes, which you do not have control over," said Burger. "But your spending personally is something you do have control of, so you're basically voting to give yourself a local tax decrease."
Burger pointed out that, in a county without a large retailer, retail options are not as great in Scott County as some others. The majority of the tax would be brought in by convenience stores, restaurants and hotels -- primarily people who travel through the area.
The half cent "amounts to nothing individually, but is big to us as a county," said Burger.
And even with the half-cent increase, Scott County will be tied with other counties for the lowest rate in six surrounding counties, said Burger.
He also pointed out a larger benefit for the area. "Economists tell us that every dollar generated turns over at least three or four more times," he said.
"It is so vital to the operation of this county that we get this passed," said Burger. "We need each and everyone's support."
He and other commissioners are meeting with city councils and similar boards throughout the county, as well as individuals. They urged the elected officials to also get out the word, and commissioners said they would gladly speak at any other organization's meetings to explain the initiative.
One individual suggested commissioners also go to schools, or events such as basketball games, to speak to high school students, teachers and parents.
Also, a meeting is planned for 6 p.m. Dec. 8 in the circuit courtroom. The public is invited and each elected official was urged to bring two people. From that meeting, a committee will likely be formed in support of the initiative.
The following measure will appear on the Feb. 3 ballot for Scott County voters:
"Shall the county of Scott reduce its total property tax levy annually by 100 percent of the total amount of sales tax revenue collected in the same tax year and in conjunction therewith, impose a countywide one-half cent sales tax, provided that such sales tax shall expire on Dec. 31, 2016?"