Local taxing entities may be exploring the prospect of repurposing the .15-cent sales tax dedicated to the creation and maintenance of HorseThief Reservoir after its scheduled sunset in 2021.
The idea was broached at the Finney County Economic Development Corp.’s annual meeting on Wednesday as a solution to a funding formula that has routinely remained below the standard set forth by a plan agreed upon by the partnering taxing entities in 2005.
The Telegram erroneously reported in Thursday’s edition that the FCEDC had proposed a .25-cent sales tax hike at its annual meeting. The FCEDC cited the .25-cent sales tax hike proposed as a funding option in the 2005 Fruth Plan to juxtapose those projected revenues with the revenues that would be generated over time by a continued .15-cent sales tax.
The Fruth Plan was provided by William Fruth, president of POLICOM Corp., an economic research and consulting firm, to steer Finney County away from potential economic disaster in the wake of the fire that destroyed the Con Agra beef processing plant in 2000.
Voters approved Finney County’s .15-cent sales tax in 2005 to partner with Ford, Gray and Hodgeman counties in the creation and maintenance of the HorseThief Reservoir in Hodgeman County.
FCEDC President Lona DuVall said on Thursday, said perpetuating the sales tax after 2021, when managers of HorseThief Reservoir are set to fund ongoing maintenance through an endowment, would continue to deliver quality-of-life results in a different way through economic development opportunities.
Prolonging the tax for a new purpose after its slated sunset would still require a public vote, and DuVall said revenue generated by the tax after 2021 would be retained by a government partner, either Finney County or the City of Garden City. That partner ultimately would have control over what the FCEDC would be able to do with the funds, she said, but the added money would give the organization more flexibility in tackling projects.
“As a community, we’ve just had really good success,” DuVall said. “We’ve been really fortunate and been real successful in economic development over the last several years, and we just don’t want to see that slow down. We want to continue to be aggressive and continue to win projects and have growth in our community and our region. I think what it comes down to is we’ve just got to have funds that are dedicated to making sure that we can land those projects.”
According to the FCEDC’s estimates, the .15-cent sales tax would generate approximately $1,012,148 in 2022 if continued, compared to earnings of about $1,686,914 generated through the .25-cent sales tax recommended by the Fruth Plan in 2005. Earnings would incrementally increase over time with continued growth. If the .15-cent tax were to last into 2031, the FCEDC estimates it would generate $1,014,428 to augment economic development initiatives.
While those revenues still don’t quite match the recommendations of the Fruth Plan, which advised funding the FCEDC nearly $4 million in 2008, they at least push funding over the $1 million benchmark. The plan recommended installing annual funding increments of over at least $1 million since 2008. By contrast, the FCEDC’s budget has lingered somewhere around $300,000 over the same period.
The potential for a big project prospect is always on the horizon, and Bob Kreutzer, the FCEDC board’s vice chairman, noted during Wednesday’s meeting that the repurposed sales tax would ease the burden on property owners to contribute to future developments by preventing property tax increases.
With the sunset of the HorseThief Reservoir tax still three years away, DuVall emphasized that any prospect of repurposing the sales tax after that point is still tentative.
“I think it’s important for everybody to understand that this is just the start of the discussion,” she said. “It’s really up to our member entitie — the county, both cities and the community college — to decide how they want to go forward and whether or not this is a route they want to take… We certainly welcome input from community members as we move forward in these discussions.”
Contact Mark Minton at firstname.lastname@example.org.