For the second time in a year, Campbell County residents voted down the local option sales tax referendum. With 7,398 people voting against the referendum and 3,586 voting for it, it was defeated by a 2-1 margin. This was the second time in a row it was soundly defeated.
“The people spoke,” county commissioner Beverly Hall said.
Hall voted to put the referendum on the ballot in order for the people to decide, she said.
“They have,” she said.
The referendum, had it passed, would have increased the local sales tax from 2.25 percent to 2.75 percent.
“Personally I think it’s the fairest tax out there,” county commissioner Tom Hatmaker said. “But as hard as times are out there, I just don’t think people are going to vote for a tax increase. They might have voted for this if they thought the funds were appropriated appropriately and efficiently.”
The purpose of the tax increase was to generate about $1,567,000 in revenue, Campbell County Director of Finance Jeff Marlow estimated. However, The majority of this money, $1.37 million, would have come from within municipal boundaries. Half of this money, $685,000, would have been allocated to the school system, and the other half would have gone to the applicable municipalities, Marlow said. Only $197,000 of this money would have been generated outside municipal boundaries. Half, $98,000, would have gone to the school system, with only the remaining half being able to go to improving roads.
While state law restricts the commission from putting a sales tax increase on the ballot that can generate revenue that will serve its intended purpose, the commission was able to redirect funds from elsewhere to effectively fund improving roads. At its Sept. 17 meeting, the commission passed a resolution to redirect 50 percent of the wheel tax to improving the roads had the resolution to increase the sales tax passed. That resolution would only have been effective if the sales tax increase had passed. Currently, 100 percent of the wheel tax is allocated to the school system. Had the sales tax increase passed, it would have redirected $783,000 of wheel tax revenue from the school system to improving the roads. The school system wouldn’t lose any revenue, because state law mandates it receive $783,000 of the money generated from the sales tax increase. With allocations from sales taxes and the wheel tax, the highway department would have receive $881,000 if the sales tax increase passes.
There isn’t a limit to the amount of times the resolution to increase the sales tax rate can be put on the ballot, Marlow said. However, the attempts must be separated by at least six months.