State Lawmaker Proposes Local Option Sales Tax Bill

State Sen. Kathy Stein, D-Lexington, has introduced a bill in the General Assembly that would give cities a local option sales tax.

Louisville Mayor Greg Fischer has been a major proponent of the measure, which allows local voters to decide whether to fund special projects through a temporary sales tax increase. The mayor recently outlined the measure for Metro Council members, saying it gives Louisville more independence.

The bill was introduced Jan. 8 and will be in the State and Local Government Committee.

Stein says many lawmakers oppose any new taxes, but this gives local residents decision-making power.

“It is an option, unfortunately whenever some of us hear the word tax we jump 10 feet up in the air and say ‘no, no, no.’ But you need to pay attention. It gives the taxpayers the option of doing it. The people who vote have the options,” she says.

For months, Fischer has been the chief cheerleader of the initiative arguing the city needs additional revenue if it wants to remain competitive. The plan has been dubbed Local Investments For Transformation, or LIFT, and the city’s chamber of commerce has been lobbying state lawmakers in the current legislative session.

But when asked who would back a sales tax option during an interview with the Courier-Journal editorial board on Monday, Fischer said his office hadn’t decided who should sponsor such legislation.

“Right now, we’re just on the education phase on it,” the mayor said. “So we’re thinking who should it be and who is interested.”

One Fischer spokesman told WFPL that the mayor’s office was unaware that Stein’s legislation had been proposed, adding that it was going to propose a bill in 2014. But later another Fischer spokesman told the radio station that the mayor did know about Stein’s bill when speaking to the newspaper and was speaking broadly.

“What the mayor was talking about—he may have misunderstood the question—but what the mayor meant was we have to really educate all of the House and all of the Senate on what the bill is. And many people are not really familiar with local option sales tax and how it works,” says mayoral spokesman Chris Poynter.

Stein says Fischer’s office was not in communication with her about the measure, but that she did alert Lexington Mayor Jim Gray about her intentions.

“I’m hopeful that it only sends a message to Louisville residents that someone in (Mayor Fischer’s) office who is supposed to read the orders of the day overlooked that,” she says. “Mayor Fischer is a very bright individual and a lot was going on last week both in Louisville and Frankfort. I don’t give much credence to anything other than somebody overlooked it.”

If approved by state lawmakers, the measure would then be on the November 2014 ballot for voters to amend the Kentucky Constitution.

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