Williams sales tax, Measure G, raises questions

Some of the hardest questions Williams officials have faced so far about its sales tax initiative came from within a group that has been one of its strongest supporters of Measure G.

In short, it was the city's firefighters heating up the room.

Who will be paying this tax?

Will the tax come to an end, or is it permanent?

Will the city be asking for even more in the future?

And why, even with Measure G, does the city project a deficitbudget by fiscal year 2017-18?

"We are not concerned about that. That can be managed," City Administrator Chuck Bergson said about the deficit projections at an informational meeting held at the fire hall on Monday night.

The 10-year forecast is based on virtually a flat growth rate for revenues, about half the state's projection of 7 percent growth in the same time period.

The city projects a $14,000 deficit by 2017-18 if Measure G passes. If it does not, that figures climbs to $54,000.

"It's the big red one that I am worried about," added Bergson, pointing at a graph that puts the deficit without Measure G at $454,000.

By 2019-20, the deficit is projected to be $87,000 with Measure G and $564,000 without it. By 2021-22, without Measure G, the projection is for a deficit of more than $600,000.

Measure G continues a half-cent sales tax that is already in place, but is scheduled to end on March 31. It represents about $410,000 annually — or about 14 percent of the city's general fund revenue.

Finance Officer Rex Greenbaum conducted the meeting, which was attended by Councilmen Don Barker and Alfred Sellers Jr.

It was the second of three such meetings. The last is set for 7 p.m. next Wednesday at City Hall.

Greenbaum assured the handful of firefighters who made up the audience that even a small increase in the growth rate of revenues will likely cover the city's deficit projections.

"But we like to be conservative with our sales tax projections," Greenbaum said.

He also assured the firefighters that public safety — namely police and fire — are the most essential services.

Some of the firefighters indicated they thought the department was not getting as much as it should in comparison to other departments and asked the staff to explain where the money in such offices as finance actually goes.

The city contributes $219,000 annually to the fire department, which is not a city agency, but rather is administered through a joint powers agreement.

Losing the sales tax would likely take a significant bite out of that amount.

That is why the firefighters association has been one of the biggest supporters of Measure G, and perhaps why Kelly Ornbaun on Monday was concerned the city officials are not getting the message out clearly enough.

However, city officials said they have received mostly supportive comments about Measure G, and do expect it to pass on Nov. 6.

One of the primary reasons is because the local residents are not paying the biggest share of the tax. Visitors to Williams, with gasoline, restaurants and hotels, account for well over 50 percent of the tax generated.

Vistors, in fact, account for more than 80 percent of the tax generated by gasoline purchases.

But that was not the only concern.

"Six years ago, you promised if we pass this it would come to an end in six years. ... What happened to derail that?" Rex Hayes asked.

The short answer was the economy collapsed, and with it the projected property tax increases the city was counting on when it set the six-year schedule for the tax.

Measure G makes the tax permanent, although Greenbaum noted that a council could always take it off the books if Williams were to experience some kind of economic boon.

Not many in the room believed that is likely. Still, that boon could be something like a truck stop coming to the area. City officials have projected that would represent nearly $1 million annually in sales tax, so even if the half-cent was removed, it would be substantial.

But new projects and potential revenue increases are not factored into the city budget until the revenues actually start to flow.

If city officials have any dire concern about Measure G it is because it appears on the same ballot with the state sales tax initiative, Proposition 30, and similar measures.

In that situation, they are concerned voters will just vote no on everything without considering the individual merits of the measures.