Sat May 24, 2014
Council Republicans Plan to Contest Louisville Mayor's 'New Tax'
A majority of the Louisville Metro Council praised Mayor Greg Fischer's 2014-15 budget proposal for investments in public safety, capitol projects and infrastructure.
But Republican lawmakers who pushed for more police officers in past budgets say they oppose the proposed 3 percent LG&E franchise fee as a "new tax" by the Fischer administration.
The fee on natural gas is projected to generate a net worth of $4.8 million towards new officers on the street, crime analysts, and hiring a new prosecutor.
During the budget address to the council, Fischer said the revenue is necessary to make a long-term investment in public safety.
"This is a fee that most Kentucky communities already have," he said "Lexington residents pay four percent versus our proposed three percent."
"Enacting this fee is not something I do lightly, but I believe this is in the best interest of our community – to increase police protection, keep our city growing, maintain a balanced budget and invest in the quality of our neighborhoods."
Council Democrats appear to have accepted the need for the fee, which the mayor's office says will result in an additional $20 per year on most household's utility bills.
But the GOP caucus points out that the city's revenues from occupational tax receipts and other sources are up by about 3.5 percent and that Fischer's fee is unnecessary.
"Public safety has been an issue for us for some time," says Republican Caucus Chair Kevin Kramer.
"There are some of us who really aren’t comfortable and not convinced that these two things are intricately linked together and that the only way to do this is with a franchise fee. If you look at the budget you’ll note that our revenue is up this year, considerably. If this were in fact a priority of ours there are ways to take care of our priorities."
An ordinance with the fee was introduced Thursday and it appears the council's Democratic majority is in favor of the idea and don't believe the fee is a tax on residents at all.
"We are giving (LG&E) access to our public right of ways and we believe they should pay for that," said Council President Jim King, D-10. "They do that in 160 cities in Kentucky and we see no reason why they shouldn't pay for that here in Jefferson County."
LG&E has made a $600,000 payment as a company to Metro Government for years, but that will be discontinued under Fischer's new budget. Unlike the previous payment plan the fee generating $4.8 million in revenue will be passed on to Louisville customers.
"We’ve struggled through some very, very tight budget years. And even during those tight budget years there were folks who were insisting that we needed to improve on safety there wasn’t a discussion of adding new taxes," said Kramer. "We’ve been consistent in saying we can take care of the budget needs without raising taxes. And so adding a new tax at this juncture is going to be a concern for some of us."
Below is a full statement from seven council Republicans regarding the proposed fee.
The mayor has presented his priorities and vision for the people of Louisville Metro and we are disappointed that his proposal seems to disregard 300,000 people who live in the fastest growing areas of this community.
In a $750 million budget, the only interest shown to some parts of this community is the amount they can help pay in a new tax on every household of the county.
We appreciate the interest in public safety expressed by the administration and agree that increasing the number of officers on the street is a priority. However, effectively increasing taxes with a $4.7 million per year 'fee' is not the solution. We also appreciate the fact that groups such as the Community Ministries and external agencies are being funded, but we continue to ask why it is that our library system refuses to actually address the needs of those areas that are growing most rapidly and have the highest percentage of usage.
The council's budget hearings begin May 28.