Proposed one-cent sales tax increase could fund new Rainbow City master plan projects
A public hearing will be held to discuss raising Rainbow City's sales tax from 9% to 10%. The funds would go towards facilities and long-term capital improvements.
Rainbow City Mayor, Joe Taylor said they intend to use the added revenue to move the city's new master plan forward.
The city could see a $1.4 million to $1.6 million increase in revenue each year if the tax is approved by the city council.
READ MORE:Rainbow City leaders look towards future growth with new master plan
"The city hasn't built. It hasn't done anything in 25 years. It's time for us to start doing something new," he said.
Some projects in that plan include constructing a quality-of-life community center, building a city center, and enhancing riverfront property.
Mayor Taylor explained the property for the quality-of-life center and city center has already been purchased. The funds from a sales tax increase would go towards the cost of construction.
"The voters and the citizens, they were represented in our master plan. We brought them in. We heard their voice and now we are going to find a way to get the things done that would make their lives better," said Taylor.
Howard Harp does his shopping in Rainbow City. He's for a one-cent sales tax increase but wants it to go towards what the city needs.
"I don't want them to waste it or just throw it away on no-need projects that people aren't going to be concerned about," said Harp.
Harp sees economic opportunity in the master plan projects, especially upgrading the waterfront.
"They can schedule bass tournaments, different things. Weddings for example. It would just bring in revenue," he said.
Other shoppers we spoke with were okay with the tax. One person said it wouldn't make much of a difference for them because they already pay a 10% sales tax in surrounding communities.
The public notice for the tax specifically excludes the use of funds for general projects like road resurfacing, the extension of water and sewer utilities, and new road construction.
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ABC 33/40 asked Mayor Taylor, why?
"Our decision was to make sure we didn't just go and tax so that we could begin to relieve the pressure on our general fund. I looked at it and went over our budget to make sure we aren't borrowing from Peter to pay Paul. We want to make sure that our routine paving and the things that require us to be good stewards of the money, that we are doing just that. We aren't trying to fluff the budget by increasing taxes. We are actually going to take this and earmark and dedicate it to the projects needed for the city," said Taylor.
If passed, it would be the city's first sales tax increase since 2005, according to the notice. An increase was attempted in 2018 but failed.
Mayor Taylor added the city council has spent almost two years thinking about the increase before introducing the proposal.
"We decided to give it a moment and just make sure we didn't see a marked change in revenue. We also went through the master plan. In our master plan, that was one of the things we knew for us to do some of the catalyst projects to create growth and economic development, that we would need to do a one percent sales tax increase. We're the only city in Etowah County that is at 9%. All of the other cities have already raised theirs to 10." said Taylor."It's one of those things that kind of spreads out the burden. We aren't just putting it on our citizens. We are also putting on everybody in the area that is enjoying our shopping. We know that it's just time for that."
The public hearing will be at city hall, Monday, September 26th at 5 p.m. The increase will be on the council's agenda for discussion.
The tax would be implemented on December 1, 2022, if approved.