Agenda Date: 08/26/2021
Subject:
Title
Ordinance 21-2021: An ordinance on second reading submitting to the registered electors of the City of Littleton, Colorado, a ballot issue regarding a ¾ cent sales and use tax increase to fund the cost of capital improvement projects
Body
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Prepared by: |
Kelli Narde, Director of Cultural and Media Services |
PURPOSE:
Does city council support placing a question on the November 2, 2021 ballot increasing the sales tax rate by 0.75%?
PRESENTATIONS:
Staff Presenter(s): Mark Relph, City Manager
Reid Betzing, City Attorney
Kelli Narde, Director of Cultural and Media Services
Additional Presenter(s): N/A
SUMMARY:
Council has heard numerous presentations over the past several years with regard to the city’s revenue situation, particularly with respect to the Capital Projects Fund. Without a new revenue source, this fund is expected to be depleted by the year 2025 which would result in a lack of funds to maintain or improve the city’s infrastructure.
PRIOR ACTIONS OR DISCUSSIONS:
At its February 2 study session, council reaffirmed Goal 2, Financial Sustainability, which included a potential timeline for a revenue-focused ballot issue.
At its March 2 study session, council was introduced to the consultant team and provided additional information on the research project.
At its April 6 council meeting, council approved a resolution releasing a budget proviso for public opinion research and polling.
At its May 18 meeting, council received a status report on the 57 qualitative telephone conversations conducted between March 22 and May 5. Council also heard the results of the benchmark telephone survey of 300 likely voters conducted between April 27 and May 2.
A telephone town hall was held June 30 with 304 attendees who participated for a total of 4,088 minutes.
The second and final telephone poll was conducted July 20-25 and those results, along with comparisons from the first poll, were presented at the August 3 study session.
This ordinance passed on first reading on August 17, 2021.
ANALYSIS:
Staff Analysis
The Community Research and Engagement Project increased the level of voter understanding of the city’s Capital Projects Fund revenue crisis. More understanding of the problem led to more support for a solution. Through all means of voter engagement (two polls, Telephone Town Hall, feedback to the Funding Fix website, qualitative research with key stakeholders, Open Littleton, etc.), there appears to be support for a sales tax question to be placed on the November 2 ballot. While a marijuana tax rate increase, a new lodging tax, and a .5% sales tax rate were considered, the .75% sales tax option has been determined to be the most viable to solve the city’s Capital Projects Fund revenue problem. In order to meet timelines for the November 2 ballot, council must consider any potential voter-approved revenue solutions for second reading August 17, and second reading and public hearing August 26.
Council Goal, Objective, and/or Guiding Principle
Goal 2: Financial Sustainability
Goal 8: Good Governance
Fiscal Impacts
The city will incur costs to conduct its municipal election in November in coordination with Arapahoe, Douglas, and Jefferson counties for open seats on the city council. Addition of a sales tax question to the ballot will increase those costs at a level the county will determine upon receipt of a ballot issue.
Alternatives
Alternative 1 - Place a .75% sales tax rate increase on the November 2 ballot.
Alternative 2 - Do not place a sales tax rate increase on the November 2 ballot.
STAFF RECOMMENDATION:
Staff recommends council place a .75% sales tax rate increase on the ballot in order to allow voters to determine whether to solve the city’s revenue crisis in the Capital Projects Fund.
PROPOSED MOTION:
Proposed Motion
I move to approve Ordinance 21-2021 on second reading submitting to the registered electors of the City of Littleton, Colorado, a ballot issue regarding a ¾ cent sales and use tax increase to fund the cost of capital improvement projects.