Politics
5:31 pm
Wed December 12, 2012

Fischer to Outline Local Sales Tax Option Plan for Council Members

Credit File photo

Louisville Mayor Greg Fischer will discuss his strategy to create a local sales tax option with members of the Metro Council this week.

Fischer has been lobbying state lawmakers and other leaders across Kentucky since July, saying the city needs the tool in the face of budget shortfalls.

The option would give Louisville voters the ability to vote for or against a sales tax increase to fund specific projects. Before that could happen, however, the measure needs a two-thirds vote in both chambers of the state legislature and a statewide referendum to amend the state constitution.

Democratic Caucus spokesman Tony Hyatt says his members are eager to hear the mayor outline his plan, adding they have serious questions about the sales tax options before showing support.

"What are you going to do with the money if it is passed and how long would such a local option tax be in place? Are you going to use it for infrastructure projects or to supplement the budget? The caucus would like to hear directly from the mayor what he plans to do with the money if the effort is successful," he says.

But council Republicans are raising concerns that an additional tax could hurt Louisville’s economy and competitiveness with similar sized cities. Fischer has proposed a levy of up to 1 percent to fund things such as a forensic crime lab or a new public transportation system.

"Members of the minority caucus have expressed their opposition to any new tax that doesn’t contain within it offsets that lead to either a reduction or elimination of other taxes such as the Metro occupational tax, which would encourage economic growth and attract new jobs to our community," says Republican spokesman Stephen Haag.

The plan has been supported by some observers, but others have said it has little probability of passing the General Assembly or among voters statewide. And locally, residents have a history of rejection new tax proposal such as in 2007, when Louisville voters rejected a plan to increase the city's occupational tax to fund new libraries by a 2-to-1 margin.

Hyatt says council Democrats acknowledge that raising taxes is a non-starter for many, but that lawmakers want to hear the mayor's plan firsthand.

"We learned with the library tax years ago (that) tax can be a toxic word," he says. "Everyone understands that, but it becomes a little more palatable when you explain what you want to do with it and the benefit for it."

The meeting between Fischer and council members is scheduled for Thursday at 3 p.m. at City Hall.

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