local option sales tax

9:59 am
Tue September 10, 2013

Study: Local Option Sales Tax Would Generate Significant Revenue, but Burden Louisville Taxpayers

A 1-percent local option sales tax would generate $138 million in revenue for the city, but add to an already heavy burden for Louisville taxpayers.

That's according to a study by a University of Louisville research center released Tuesday.

The report conducted by the Urban Studies Institute was paid for with discretionary funds from Republican Councilman Ken Fleming's office earlier this year.

It is the first official examination of the idea, which is being spearheaded by Mayor Greg Fischer as a way to create additional revenue for Metro Government.

Among the chief findings in the 40-page report is that Louisville has the highest income tax rate among its 14 peer cities at about $7,720 for hypothetical family of four with two income earners. The city also has the third-highest overall tax burden when compared to competitor cities property, income and sales taxes combined. 

Fischer has said the local option isn't a tax increase but rather emphasized it's choice for local voters to invest into the community and fund key capital projects. But according to the study, introducing a 1-percent sales tax would bump Louisville up to the second-highest overall taxed city among its peers.

Fleming says he sponsored the study to examine the economic impact and better inform the public, adding its shows the benefits and pitfalls of the plan.

"This study does a really good job at taking an objective point of view and looking at data that provides both the pros and cons of what we're trying to do," he says. "We should have had this debate last year or two years ago, and we need to have it now to understand where we are economically."

Among the benefits of a local option outlined in the study is it help diversifies the city's revenue stream, which is limited to occupational, insurance premiums and property taxes.

The study says due to Louisville's position as a retail shopping and entertainment center a local option could shift a sizeable percentage of the sales taxes those who live outside the county. The effect could mean residents would enjoy economic windfalls for infrastructure or other capitol projects at a reduced tax price.

And depending on the economy, it estimates anywhere from $140 million to $160 million in projected revenue, which is nearly twice as much as the $95 million a year that Fischer's office estimated.

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8:40 am
Mon July 8, 2013

Vision Louisville Gives Mayor Greg Fischer Chance to Tout Local Option Sales Tax

Louisville Mayor Greg Fischer is inviting residents to share their big ideas at a town hall meeting this week, but the administration has an added incentive—promoting the local option sales tax.

Vision Louisville is a public forum series scheduled to take place throughout the city and is part of Fischer’s 25-year strategic plan.

The mayor hopes to gather 45,000 ideas from citizens over the next 45 days on how Louisville should develop and feel. Among the issues heard at the first public forum held last month were public transportation, quality of life and arts funding.

Many of those and other ideas being shared concentrate on economic development, and mayoral spokesman Phil Miller says Fischer believes any future for Louisville must include a look at the cost of and how to pay for large-scale development.

"Certainly the idea of a progressive Louisville where progressive projects are undertaking is tied very closely to the LIFT initiative. And I think that’s why he thinks it’s important for the future of the city,” he says.

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8:30 am
Mon March 25, 2013

Councilman Ken Fleming to Fund Local Option Sales Tax Study

Councilman Ken Fleming, R-7
Credit Louisville Metro Council

Louisville Metro Councilman Ken Fleming, R-7, is sponsoring a $25,000 study on the economic impact of raising the state sales tax in the city.

Mayor Greg Fischer has been lobbying residents and state lawmakers to support a local option sales tax to raise revenue for special projects.

The plan would allow local voters to accept or reject raising the sales tax, which proponents say could generate around $90 million annually.

But Fleming says the city hasn’t examined its current tax structure and officials don’t know how an increase would burden residents.

"We really don’t have a benchmark or a good analysis on the taxes and how it affects individuals, and this study I’m anticipating will gives us a clear understanding of the tax implications. It can be used for future analysis or reviews of any type of taxes that might come up," he says.

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7:30 am
Mon February 25, 2013

Mayor Greg Fischer: Poll Validates Local Option Sales Tax Push

Greg Fischer
Credit Gabe Bullard/WFPL

A new Courier-Journal Bluegrass Poll shows an overwhelming number of Kentuckians favor a constitutional amendment that would allow city residents to vote on whether to raise the state sales tax.

The survey found 72 percent of voters support the proposal, while 19 percent are opposed and another 9 percent are not sure. But legislative leaders from both parties in Frankfort have spoken out against the measure, preferring tax reform or raising other fees for special projects.

Louisville Mayor Greg Fischer told WFPL the poll shows residents are behind the idea and he will continue to lobby state lawmakers.

"I’ve been talking to legislators in Frankfort along with other mayors and county judges from around the state to show them that there is in fact strong support at the grassroots level and we hope Frankfort will be listening to the people," he says.

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5:54 pm
Mon February 11, 2013

H&R Block: Louisville 7th Most Taxed City in America

Credit hrblock.com

H&R Block has released a graph showing what many have said for years, Louisville is one of most tax burdened cities in the country.

The findings are based on a study conducted by the chief financial officer of Washington, D.C.

That reported was touted by Councilman Ken Fleming, R-7, as a reason for Mayor Greg Fischer's administration to think twice about pushing a local option sales tax.

H&R shows that a hypothetical family of three with an annual income of $50,000 pays an estimated $6,346 in taxes annually.

That means Louisville residents carry a 12.7 percent tax burden, ahead of Boston, Massachusetts at 12.3 percent and just behind Chicago, Illinois at 12.8 percent.

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6:00 am
Sun February 10, 2013

Stumbo, Stivers Oppose Local Option Sales Tax; Fischer Undeterred

Greg Fischer
Credit Louisville Metro Government

Kentucky's top two legislative leaders are throwing cold water on a proposal to create a local option sales tax for city and county governments.

The plan would give local voters the ability to decide whether to fund special projects through a temporary increase to the state sales tax. It would typically be used for infrastructure, supporters say, but could also be applied to long-term investments.

Democratic House Speaker Greg Stumbo, however, says cities already have alternatives for such projects.

"There's a lot of options that they have, that they haven't used for local option taxes if they want to utilize them. So I don't necessarily favor it," he says.

The measure is heavily supported by Louisville Mayor Greg Fischer and Lexington Mayor Jim Gray, both Democrats. 

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11:30 am
Sun February 3, 2013

Noise and Notes: Council Leaders David James and Ken Fleming on Taxes, City Budget and Guns

Louisville Democrat David James and Republican Ken Fleming don’t always agree as leaders of their respective caucuses, but the two Metro Council members hope city lawmakers tackle a number of issues this year.

Among them is the new spending plan for the city. Mayor Greg Fischer says the local economy is bouncing back from the recession, but Metro Government still faces a $13 million budget shortfall.

Both parties hope the budget process is transparent, and James and Fleming agree that public dollars for city services are running thin and need to be spent wisely.

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6:05 pm
Thu January 24, 2013

Fischer Lobbies for Local Option Sales Tax, Pension Reform in State of City Address

Louisville Mayor Greg Fischer
Credit File photo

Mayor Greg Fischer says Louisville’s economy is rebounding from the national recession, but the city still faces a large budget shortfall due to rising pension costs.

Fischer made the comments at his annual State of the City address before the Rotary Club at the Kentucky Center for African-American Heritage. This year's speech was slightly more upbeat than previous ones, with the mayor arguing that Louisville is becoming more entrepreneurial.

The Metro area has added 22,000 jobs and unemployment has dropped by almost four percent in the last two years. But challenges remain, namely Metro Government's hefty budget deficits.

"Last year’s $25 million gap is now down to about $13-14 million out of a $500 million general fund. That’s still a lot of money. But we didn’t get into this problem in two years and we can’t solve it in two years," says Fischer.

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3:04 pm
Wed January 23, 2013

Beshear Supports Local Option Sales Tax

Steve Beshear
Credit Kentucky Governor's Office

Proponents of a local option sales tax have gained big ally in their legislative fight: Gov. Steve Beshear. 

The local option sales tax would allow cities to levy an additional tax on top of the state’s current six percent sales tax for specific projects, if local voters approved the new tax.

Louisville Mayor Greg Fischer and Lexington Mayor Jim Gray are the chief advocates pushing the idea, arguing their cities would use the extra revenue for infrastructure projects.

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7:24 pm
Thu January 17, 2013

Councilman Ken Fleming Questions Mayor Fischer's Local Option Sales Tax Proposal

Councilman Ken Fleming, R-7,
Credit Louisville Metro Council

Louisville Metro Councilman Ken Fleming, R-7, is concerned that Mayor Greg Fischer’s push for a local option sales tax will burden residents and wants to examine cutting other levies first.

For several months the mayor has been lobbying that the city needs the tool to be more competitive and independent.

Fischer argues his administration is not seeking a tax increase, and only wants voters to have the power to decide whether or not to fund special projects through a temporary hike to the state's sales tax.

But Fleming says the mayor has provided few details on what a specific proposal would look like, and is ignoring his campaign promises to spur economic development and job creation.

"Their goal should be economic development, and adding an additional tax on individuals regardless of income is not the right way to go," he says. "What we need to focus on is to try to find those strategies and tactics like getting rid of the occupational tax. That will help development incur job creation. I think we ought to look at that process and not a tax mentality."

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