The Kingman City Council has extended a portion of one tax and informally endorsed the possibility of putting another before voters next spring. Extension of a one-half cent component of the municipal sales tax (Transaction Privilege Tax) was approved by a 6-1 vote during the October 6 council meeting.
Finance Director Tina Moline reiterated that a previous council approved the half-cent sales tax increase in May, 2013. It was billed as a “temporary” increase and was scheduled to sunset, or expire, by next summer.
The Council, however, decided to extend the half-cent component through the end of 2016, believing the city cannot make do without the $2.8-million or more it brings in annual revenue. Absent the approved extension, Moline said the city would likely have to make cuts in essential public safety and parks spending, let alone foregoing critically important capital expenditures expected in coming years, according to City Manager John Dougherty.
Council members Larry Carver and Carole Young (dissenter in the 6-1 vote) noted that the half-cent sales tax increase approved in 2013 came with a council commitment to find another revenue stream before it expired. They said the Council has not fulfilled that promise but must diversify the city revenue portfolio, possibly through use of a primary property tax, which requires voter approval.
Other council members agreed to extend the half-cent sales tax while working to educate the public of the importance of passage of a primary property tax at the ballot box.
“I believe I see that there’s an importance of extending the sunset, but we do have to look at other avenues of revenue and the primary property tax would probably be the most efficient way,” council member Mark Abram said. Kingman does not currently levy a primary property tax.
Moline, after the meeting, indicated that staff will be working on scenarios and options for the council to consider as it contemplates seeking voter approval of a primary property tax.
Moline said a levy of $1.69 would currently generate about $3-million annually for the city, according to projections. She said it would take a levy of $3.39 to generate $6-million in annual revenue.
By comparision, the current Mohave County primary property tax levy is $1.97. County elections Director Allen Tempert said the City has about a couple of months before it must make a levy determination, formally call for an election and submit the necessary paperwork for a vote next May.
City Clerk Sydney Muhle said it is expected that it would cost the city about $125,000 to fund a special election.