City continues to look at local option tax

VERGENNES — Members of the Vergennes City Council at their Oct. 24 meeting continued their preliminary discussion of local option taxes, which piggyback on state sales-and-use or rooms-and-meals taxes by adding 1 percent for local revenue to either or both.
Before a Vermont municipality can put such taxes in place a charter change is required that must be approved first by voters and then by the Legislature.
Mayor Michael Daniels said last Tuesday that he would like the council to consider the idea as a way to fund improvements to city facilities, including currently unfunded projects called for in the city’s recently adopted Downtown/Basin Master Plan.
“There are many different ways you can use the money,” Daniels said.
In a Wednesday interview Daniels offered examples: recreation improvements, such as a dog park and other projects in the Otter Creek basin area; more funding for work to the city pool and other nearby recreation facilities on East Street; walking paths, something favored in surveys of residents; and traffic-calming measures, including possibly more pedestrian-triggered crosswalk lights on top of the five grant-funded sets already on the way.
A study of the impact of the program conducted several years ago said Vergennes could net $100,000 a year if both taxes were collected in Vergennes. City Manager Mel Hawley said on Tuesday he recently received an updated estimate of almost $177,000 a year.
Local resident Kevin Rooney said before considering the option taxes the city should get estimates for the projects and see if existing city funds, such as the Watershed and Water Tower funds, among others, could pay for the work.
“As soon as you say option tax all the businesses freak out, especially the big ones,” Rooney said.
Daniels said he and Alderman Renny Perry, also the Vergennes Partnership president, would both work on estimates and reach out to the business community.
Hawley said the two major funds have limitations, and also are already being heavily relied upon.
“That’s what we do all the time,” he said.
Alderman Mark Koenig suggested the council consider a charter change that would give the council the authority to impose an option tax for specific purposes, subject to voter approval. Rather than simply establish the tax, he said, the council could turn it on and off as required.
Daniels said aldermen should continue to discuss the issue with residents and business owners and talk again at the next council meeting, which is scheduled for Tuesday, Nov. 14, 5:30 p.m. (unless otherwise posted) at the Vergennes Fire Station.
Andy Kirkaldy may be reached at [email protected].

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