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Posts Tagged ‘local-option sales tax’

Flood victims in newly purchased homes may not lose their down-payment assistance after all; city looks at using local-option sales tax revenue to help

In City Hall, Jim Prosser on June 25, 2009 at 1:53 pm

City Hall is investigating the possibility of providing targeted help to flood victims who received state Jumpstart down-payment assistance on a new home and now have learned that the amount of assistance will be subtracted from any buyout payment on their old home.

The local Jumpstart office two weeks ago said 383 homeowners had received Jumpstart down-payment help to date at a cost of $8.8 million or about $23,000 per home.

Initially, it was unclear if that money would be considered a “duplication of benefits” subject to deduction from a homeowner’s buyout settlement. However, the down-payment assistance is now considered a duplication of benefits.

City Manager Jim Prosser brought up the issue at Wednesday evening’s council meeting as he and the City Council talked about how much money the city will need to buy out some 1,300 flood-damaged homes and other properties.

There seems a growing likelihood that the city will have enough money to do the job.

The Federal Emergency Management Agency will pay to buy out a first group of about 170 flood-damaged properties that sit in a proposed greenway area along the river.

Additionally, the state of Iowa has proposed setting aside $245 million of a latest round of $517 million in federal Community Development Block Grant funds for buyouts statewide. And the city has made a request for $175 million of that amount to pay help for buyouts of another 1,150 or so homes and other properties.

The city also is now collecting a 1-percent local-option sales tax, which could raise $80 million or more over five years for use in buyouts and other housing issues related to flood recovery.

It is from this last batch of money, the local-option sales tax revenue, that Prosser said the city is looking to draw to provide some relief to those who stand to essentially lose their Jumpstart down-payment assistance on a newly purchased home once the city buys out flood-damaged homes.

Prosser said such a use of sales-tax revenue was needed for those who bought a home not unlike the one they lost in the flood only to find that they do not have sufficient income to support mortgage payments on the newly purchased home.

The city has expected FEMA and CDBG money to carry much of the load on buyouts, but Prosser said the city always knew there would be funding “gaps” for which local-option sales tax revenue could be used.

Those who stand to lose their down-payment assistance may be one of those gaps, he said.

On Thursday, Prosser said his staff is still looking into how many properties might be involved and how much the city might be able to steer to help those who had gotten down-payment assistance.

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Grass-roots group that engineered local-option sales tax triumph donates $24,183 in excess campaign funds to Habitat for Humanity

In Floods, local-option sales tax on June 2, 2009 at 2:09 pm

Vote Yes for Our Neighbors, the Cedar Rapids grass-roots effort that successfully campaigned to secure passage in early March of a 1-percent local-option sales, has donated its leftover campaign funds — $24,183 — to Cedar Valley Habitat for Humanity.

In less than a month, the Vote Yes campaign raised $85,343.46 from what Gary Ficken and Dale Todd, campaign co-chairmen, said Tuesday was a diverse group of donors.

It did not use $24,183 of the funds raised for the campaign.

Ficken said Vote Yes for Our Neighbors and those who donated to it acted with “housing, housing, housing in mind” for flood victims. It only made sense, then, he said, to use what was left of the campaign dollars on housing for flood victims. Habitat has agreed to use the money in that way, he said.

Ficken said the mix of donors supporting the five-year, local-option sales tax for flood-victim housing was tghe most diverse group of donors he’s ever seen in a campaign for anything. He said the support made the campaign “entertaining,” and he added the fact that the campaign lasted just three-and-half weeks didn’t hurt either.

From 71 applicants, nine are chosen: City Council names Local-Option Sales Tax Oversight Committee

In City Hall, local-option sales tax on March 30, 2009 at 6:16 pm

The City Council on Monday named the nine members of the city’s Local-Option Sales Tax Oversight Committee, a group picked from 71 who had applied for the job.

The members are Markell Kuper, Elizabeth Hladky, Heather Schoonover, Charles Watkins, Jeff Palmer, Sandra Skelton, Gary Ficken, Jeffery Beer and Stephen Hammes.

The council will formerly appoint the committee members at its weekly Wednesday meeting, which falls on April 1, the day the one-percent local-option sales tax starts to be collected in the city.

The tax will be in place through June 30, 2014, and is expected to raise between $17 and $18 million a year for the city.

The oversight committee’s mission is to review how the council spends the tax revenue to make sure it is in accord with the March 3 referendum that put the tax in place.

Ninety percent of the money is to go to flood relief, and more specifically, to housing buyouts and rehabilitation. Ten percent is to be used for property-tax relief.

Ficken, a local business owner, led the citizen campaign, Vote Yes! For Our Neighbors, that promoted the local-option sales tax. Hammes, an accountant, led the city’s Twin Pines Golf Course Task Force that recommended in 2008 that the city not sell 20 acres of the 150-acre course for a commercial development.

Twenty finalists now become 24 for nine-member Local-Option Sales Tax Oversight Committee; neighborhood assn. v.p. drops out

In City Hall, Floods on March 20, 2009 at 11:03 am

The City Council pared the list of 71 applicants for the nine-member Local-Option Sales Tax Oversight Committee down to 20 last week, and on Monday, the council increase the list of finalists to 24.

Added to the list were Markell Kuper, Jerry Gillon, Patrick DePalma, Nick Cappussi and Joseph Michalec Sr., while Jon Galvin, vice president for the Northwest Neighbors Association, withdrew his name from the list.

Each council member reviewed the 71 applications and each ranked applicants one through 20, and then those rankings were thrown together to come up with the finalists.

Each of the 24 will have a 7-minute interview with council members on Tuesday, Wednesday or Thursday. The nine members will be in place by April 1, when the local-option sales tax is collected.

Those named previously are Jeffery Beer, Stephen Hammes; Gary Ficken; James Powers; Elizabeth Hladky; James Sattler; Patrick Courtney; Sandra Skelton; Robert Untiedt; B. Larry Johnson; Heather Schoonover; Don Boland; Richard McArtor; Jeff Palmer; Marvin Dale Hedgecoth; Oran Teat; Jon Galvin; John Gruca; W. Scott Jamieson; and Charles Watkins.

Council members picked the finalists, in part, with an eye to those who could bring expertise in accounting, finance, construction and disaster recovery.

Council members also said they were looking for representation from those affected by the flood.

The heads of neighborhood associations have pushed to get representatives from their groups on the oversight committee. Northwest Neighbors’ Galvin, though, has now dropped out of consideration.

Council members have emphasized that the Oversight Committee’s role is to check and see that the council has spent local-option sales tax revenue as the council said it would prior to the March 3 vote approving the tax.

Ninety percent of the revenue is to go to housing-related flood relief and 10 percent to property-tax relief.

The tax is expected to bring in $17 million to $18 million a year for five years and three months.

City Hall kindness has not always been easy to find for neighboring jurisdictions that dump on sales tax

In City Hall, Marion, Mayor Kay Halloran on March 7, 2009 at 8:08 am

City Hall kindness is new found when it comes to jurisdictions whose voters dump on local-option tax.

On Friday, Cedar Rapids Mayor Kay Halloran was out counting noses, trying to find a majority on her nine-member council to pass a resolution, oddly, for the city of Marion.

Halloran got the votes, and as a result, the city of Marion will get a second bite at the local-option sales tax apple.

Marion city officials had lobbied Halloran and other Cedar Rapids City Council members after voters in Marion turned down the local-option sales tax on Tuesday along with the cities of Hiawatha, Robins, Center Point and the Linn County portion of Walford.

At the same time, Cedar Rapids easily passed the tax, the revenue from which it will use primarily for flood relief over the next five years and three months.

Marion stood to take in about $3 million a year during the life of the tax, which is an amount city leaders in Marion weren’t reluctant to easily turn their backs on. Particularly when the measure was defeated by 183 votes out of 4,271 cast.

The Cedar Rapids council is in the middle of the affairs of its neighboring communities because of the demands of state’s local-option sales tax law. That law, as applied to Linn County, creates only two ways to get the question of a local-option sales tax on the ballot: the Cedar Rapids City Council, which represents a majority of residents in Linn County, must do it; or proponents of the tax can amass signatures on a petition that number at least 5 percent of the total who voted in the last general election.

Halloran said the decision was an easy call for her, and she pointed to the first days after the June flood when the city of Marion stepped in and provided public-safety dispatching services for Cedar Rapids.

“So the idea is, as a matter of comity and neighborliness, they help us when we need help, and we’ll help when they need help,” the mayor said.

It was quite a different story, though, back in 2001 when Cedar Rapids and nearly every jurisdiction in the county put the local-option sales tax in place, but unincorporated Linn County rejected the matter and stood to lose about $4 million a year.

No sooner had the election office closed down on election night and the county’s Farm Bureau members and the Linn County Board of Supervisors were on the phone to Cedar Rapids City Hall, hat in hand, asking the council to put the measure up for a revote out in the county.

The Cedar Rapids City Hall has three words for the request: Get some signatures.

“Calling for a vote without a petition drive would be a departure from previous practice of the Cedar Rapids council,” the City Council said back then. The council noted that the city’s 2001 vote on the sales tax for swimming pools was supported by a petition of 5,188 signatures and that an election the previous on a minor-league baseball stadium levy was backed by 3,361 signatures before the council put the matters on the ballot.

Then-Parks Commissioner Dale Todd was the most outspoken of the City Council members back then. Who was he, Todd asked, to decide that rural residents really didn’t mean to reject the tax when they voted that way Tuesday?

Then-Mayor Lee Clancey stressed the City Council’s tradition of asking for petitions from those interested in putting an issue on the ballot.

Clearly, her preference was that any revote come from a petition drive with a sufficient number of signatures to prompt a vote without the City Council’s help.

“The citizens in rural Linn County had an opportunity to vote on this two days ago,” Clancey said. “If there is strong sentiment among the citizens of Linn County that they would like to have this revote, I think it might be an appropriate way to go to have a petition.

“Then at least we would have a feeling for what folks really would like to do. The only thing we have right now is the majority of them declined the option tax.”

Within a few days, the Farm Bureau had rounded up 10,131 county residents, more than twice the number needed to put the measure back on the ballot. Voters in unincorporated Linn, Walker and Walford then returned to the polls and passed the tax.

On Friday, Marion city officials said what was said eight years ago: Marion voters didn’t understand the complicated, quirky tax.

Lon Pluckhahn, Marion’s city manager, said on Friday that Marion council members likely would not have requested a new vote if they and he hadn’t received many calls from citizens who said they had not understood the Tuesday vote.

“I’m glad to see it,” Pluckhahn said of the Cedar Rapids council decision to clear the way for another sales-tax vote. “We’ve worked hard to improve relations between the two cities.”

He noted an e-mail from one Cedar Rapids council member who said he would not have wanted to have to get Marion’s permission if Cedar Rapids wanted a new vote.

Seventy apply for nine slots on Oversight Committee to help City Council spend $90-plus million in sales tax funds

In City Hall on March 6, 2009 at 7:01 pm

Seventy residents have applied to sit on City Hall’s nine-member Local-Option Sales Tax Oversight Committee.

Among the 70 is Gary Ficken, a local businessman who was co-chairman of Vote Yes! For Our Neighbors, the grass-roots group that the campaign to get the 1-percent sales tax passed on Tuesday.

The residents approved the ballot measure by a 59 percent to 41 percent margin.

Also on the list are some of leaders of the city’s flood-damaged neighborhoods, including Frank King and Jon Galvin, president and vice president of the Northwest Neighbors Association; Michael Richards, president of the Oak Hill Jackson Neighborhood Association; and Gregory Stokesberry, president of the South West Area Neighbors.

In a letter to City Hall on Friday, King, Richards, Stokesberry and Dianne Yanda, president of the Cedar Valley Neighborhood Association, said they were “demanding” that the mayor and City Council make sure that their neighborhoods are represented on the oversight committee.

“We believe that this is the best way to protect the interests and ensure the confidence of those Cedar Rapidians most egregiously affected by the flood,” the four neighborhood presidents said. They have joined in what they are calling the River Neighborhood Alliance.

The mayor will make the selections to the Oversight Committee with the advice and consent of her City Council colleagues. The decision will be made before April 1, when the sales tax begins to be collected. The collections extend through June 30, 2014.

According to the city, others among the 70 applicants are:

Andy Petersen, B. Larry Johnson, Bruce Vander Sanden, Charles Menge, Charles Watkins, David Clemens, David Hogan, David Mather, David West and Debra Dooley.

Don Boland, Donald Leonhart, Erick Skogman, Gregory Pollock, Heather Schoonover, James Nelson, James Powers, Jeff Beer, Jeff Palmer, Jeremy Cobert and John Gruca.

John Malone, Joseph Michalec, Kathi Lewis, Kathy Potts, Kevin Curl, Kevin Litten, Larry Berns, Lyle Broer, Marion Patterson, Markell Kuper, Marvin Dale Hedgecoth and Mauryne Simoens.

Michael Brunelli, Nancy Bruner, Nick Capussi, Richard McArtor, Richard Shoemaker, Robert Untiedt, Ruth Hart, Stephanie Feuss, Tamara Koolbeck, Thomas Haugen and W. Scott Jamieson.

James Sattler, James Young Sr., G. Richard Dirk Johnson, Leland Freie, Stephen Hammes, Terry Chostner, Linda Meanor, Susan Blome, Sandra Skelton, Jean Bell, Elizabeth Hladky, Patrick Courtney, William Overland, Charles Varnum, Jerry Gillon, Jody Lippmann and Thomas Zuber.

The last names of four others were not readable on the city’s list.

City of Cedar Rapids apt to see more than $1 million more a year in revenue from local-option sales tax

In City Hall on March 5, 2009 at 9:15 am

The city of Cedar Rapids could see more than $1 million more a year from the local-option sales tax than the $18 million it had expected before five cities in Linn County on Tuesday turned the tax down.

The estimate is based on a look at sales tax revenue for Linn County and for the five cities that rejected the tax on Tuesday, Marion, Hiawatha, Robins, Center Point and Walford.

In fiscal year 2008, sales for all of Linn County totaled $3.1 billion with the five cities and $2.68 billion when sales for the five cities are subtracted.

Without the five cities in the mix, Cedar Rapids will now get 72.94 percent of the local-option sales-tax revenue collected in Linn County, according to the Iowa Department of Revenue.

Using that new percentage and the revised sales figures, Cedar Rapids would take in about $19.3 million, up from the estimated $18 million that the city had expected to see if all the Linn jurisdictions had the tax in place.

Both Sue Vavroch, the city’s treasury operations manager, and Victoria Daniels, of the Iowa Department of Revenue on Wednesday urged caution with any revenue estimates because of the state of the economy.

In fact, the state agency, which collects the sales tax and then distributes it to the jurisdictions, bases its distributions on 95 percent of what it expects to collect in case fewer sales occur than expected.

Daniels said the agency would have new estimates for what the sales tax is apt to pay out in Linn County in about two weeks.

Each jurisdiction will get a larger share of the Linn County sales-tax pot, but the pot also will shrink some because the tax will not be collected or the revenue from it distributed to the five cities that voted against the tax on Tuesday.

For instance, the city of Cedar Rapids would have gotten 59.9 percent of the local-option sales tax revenue if all the jurisdictions in the county had the tax in place.

With the five cities turning the measure down, Cedar Rapids now will get 72.94. Unincorporated Linn County was to have gotten 16.33 percent of the total, and now will get 19.38 percent.

The tax was expected to have brought in about $30 million countywide. It will be less than that now that the five cities won’t collect the tax.

The Iowa Department of Revenue acknowledges that the collection system comes with a level of imprecision because some retailers mistakenly charge the extra 1-percent tax thinking it is in place throughout the county when, in fact, some places in the county do not have the tax in place.

Mayor and five possible mayoral candidates have one thing in common: All support the local-option sales tax

In Brian Fagan, City Hall, Gary Hinzman, Mayor Kay Halloran, Monica Vernon, Ron Corbett, Scott Olson on March 1, 2009 at 11:00 pm

There have been local-option sales tax elections in years past in which elected officials and would-be elected officials have deferred to the voters and not expressed an opinion one way or another of the matter.

Not this time. At least not with Mayor Kay Halloran and the five people whose names to date are afloat as possible candidates for mayor in the November election.

Halloran is a strong supporter of the local-option sales tax, as are council members Monica Vernon and Brian Fagan, both who considered possible mayor candidates.

In favor, too, of the sales tax are three other possible mayor candidates: Ron Corbett, Gary Hinzman and Scott Olson.

In recent weeks, backers of Corbett conducted a private phone survey to check out what voters might be thinking about in this year’s upcoming mayoral race.

The Corbett backers asked those surveyed to pick from five possible candidates: Corbett, Fagan, Hinzman, Olson or Vernon.

Olson, a commercial Realtor who was narrowly defeated in his run for mayor in 2005, said last week that additional taxes like a local-option sales tax do have a “negative connotation.” But he said the unique circumstance of the flood recovery “overrides” that concern. “We have many people in need,” he said.

Olson said the local revenue raised by the sales tax will help those who own flood-damaged housing but, for one reason or another, don’t qualify for federal funds. He noted, too, that a citizen oversight committee will be in place to help direct how the sales tax money is spent.

Hinzman, director of the Sixth Judicial District Department of Correctional Services and former Cedar Rapids police chief, said last week that he normally doesn’t jump at a tax increase.

“But it makes better sense than having no concept as to how Cedar Rapids bails itself out of this disaster,” Hinzman said. He said the sales tax will help the city “recover and heal as a community.”

“Without the local-option sales tax, it will be extremely difficult to get beyond the past,” he said.

Corbett, vice president at trucking firm CRST International Inc., said passing the local-option sales tax will “definitely improve” the city’s chances to secure increased federal and state funding.

“Given the scale of our disaster, we can’t pretend that we can recover and redevelop without these funding sources,” said Corbett, past president of the Cedar Rapids Area Chamber of Commerce and former speaker of the Iowa House of Representatives.

He said the local-option sales tax will provide a temporary “window of opportunity” that will give the city time to work hard to recruit companies to the city to add jobs and rebuild the city’s tax base.

Halloran and Fagan bring Condition of the City speech downtown; city needs sales tax, they say; Alliant exec has few hopes for downtown steam

In City Hall on February 27, 2009 at 4:57 pm

Mayor Kay Halloran and Brian Fagan, mayor pro tem, told an audience of about 300 at Friday’s Condition of the City speech that a 1-percent local sales tax will help the flood-damaged city rebuild.

“We need it,” Fagan said bluntly, when asked about Tuesday’s upcoming sales-tax vote during the noontime event in the Ballroom of the Crowne Plaza Five Seasons Hotel.

The annual event is sponsored by the League of Women Voters of Cedar Rapids/Marion.

To a question about the viability of a low-cost steam system in the downtown, Fagan turned to Eliot Protsch, Alliant Energy’s chief operating officer, in the crowd.

Protsch came to the microphone to say that there “may be” a solution to the steam issue for large users of the steam system, including the Quaker and Cargill plants. But he said it was “difficult” to see how steam, which had been provided by Alliant’s flood-damaged Sixth Street Generating Station, could be provided to the downtown “absent” a very large subsidy.

On the sales-tax question, Fagan said the estimated $18 million a year that the sales tax will bring to the city for five years and three months will allow the city to rebuild properly. Passing the sales tax also will show federal and state lawmakers, from whom the city is asking disaster help, that Cedar Rapids is doing its share to “support ourselves locally,” he said.

Mayor Halloran noted that the City Council will use the sales-tax revenue to buy out, repair and replace flood-damaged housing vital to the city’s work force.

“I don’t want residents of Cedar Rapids leaving (town),” Halloran said.

City Manager Jim Prosser, who joined the mayor and Fagan during the  question-answer period, said the city’s share of flood-related costs could come to $500 million even if the city and community secure substantial federal and state funds. “That’s the number,” he said.

In prepared remarks that reprised ones made at the City Council meeting Wednesday evening, Halloran said the city remains “open for business” despite the 2008 flood and its aftermath. She said the council promises to be “vigilant” with its budget and to work hard and deliver efficient government.

Halloran noted, too, that the she and the council continue to push the Iowa Legislature to stop its “draconian” ways and give Cedar Rapids and other cities the freedom to raise revenue from diverse sources. That will mean the city won’t need to be so heavily on property taxes, she said.

Halloran had Fagan focus his comments on the city’s flood-recovery effort, the costs of which are “staggering,” Fagan told the audience. He said the needs and costs don’t get better if they are ignored.

As he did on Wednesday evening, Fagan defended the City Council’s use of outside experts, who he said are helping guide the city through a community recovery that could cost $5 billion. The $5-million cost for the help, he said, is small in relation to the damage.

“Yes, we needed outside experts. Yes they are ‘consultants,’” said Fagan in acknowledging that it was issue for which the council has taken criticism.

Those in Friday’s audience also asked if the city can get too much public input before it acts and if lobbying efforts to obtain disaster relief have failed.

On the question of public input, Fagan said other communities that have gone through disasters have told Cedar Rapids that their ability to get projects started and finished had been hampered by not taking time up front to listen to the public.

Prosser said cities easily can make decisions about rebuilding, but he said the key is to make decisions that actually get implemented. Without adequate public input, they don’t, he said. He pointed to Tulsa, Okla., which he said we still trying to put a flood-protection system in place 25 years after its devastating flood.

Halloran, Fagan and Prosser all noted that much has been done and is being done to lobby the federal and state governments for disaster relief. But Prosser said the truth was that “this terrible disaster doesn’t have a simple solution.”

The League of Women Voters put Friday’s attendance at about 300, which is down from 359 people who attended a year ago.

From the podium, Halloran said the audience she was addressing looked “very intent.”

“I think they care what happens to the city, and as long as we continue to tell them what we are doing, they will recognize that we’re doing a very big job,” the mayor said.