Officials Plow Ahead with Plans for a New Tax
10/26/20 Selectboard / Trustee Joint Meeting
by Ken Signorello and Irene Wrenner
October 27, 2020
At their October 26th meeting, the Town Selectboard and Village Trustees eagerly discussed revenues that a Local Option Tax might generate, and they considered warning a vote on it in March, along with a plan of Merger.
A Local Option Tax (LOT) is an additional 1% collected on taxable sales in (or delivered to) participating towns. More info at https://tax.vermont.gov/business/lot.
Essex Finance Director Sarah Macy described the LOT as “a high priority for staff as a way to diversify revenue sources and relieve the pressure on the property tax in funding capital.”
A bit of history: On March 2, 2009, Town voters angrily defeated an article to levy a LOT at the Essex Town Meeting, then unelected the Selectboard Chair at the polls the next day. A year later, on April 7, 2010, Village voters defeated an article to levy a LOT at the Essex Junction Annual Meeting.
After such contentious failed attempts in the past, board members and staff were surprisingly optimistic about again proposing a LOT. Village Trustee George Tyler said, when it was tried twelve years ago, people didn’t understand it.
Selectboard member Patrick Murray claimed, “Most people are familiar with this enough by now. ... I don't really think it would be a hard sell.” And, of course, other nearby towns have instituted LOTs, and that hasn’t stopped people from shopping there!
Familiarity may be less important than the fact that the means of approving such a tax is likely to change. If the budget is voted on by Australian ballot, come March — for COVID or other reasons — the dynamics of voting by mail or at the polls will be very different than the prior rooms full of passionate citizens.
If a LOT were to pass, one question is how to allocate the proceeds. A LOT is collected on designated sales within a Zip Code. Because Essex has a single town-wide Zip Code (05452), the proceeds would need to be allocated somehow between the Village and TOV. It might be by grand list ratio (42% / 58%), or 50/50, or a Tug of War, as was suggested in jest.
The public had plenty to say. Past Selectboard Member Bruce Post, said he felt like “a prohibitionist at a keg party”, before reminiscing about the friction at the 2009 Town Meeting, as a warning to the current boards for how difficult passing this LOT might be.
Marcus Certa, Village resident and talk radio personality, noted this was very bad timing with the Merger vote likely to be on the ballot in March. He noted that other towns put in a LOT with clear projects in mind. Nothing specific here about how the money will be used. “We don’t have to do a tax just because we can sell it.”
Mary Post pointed out that this sort of tax is hard on regular people, who may be already struggling to make ends meet. Perhaps it should go toward funding food shelves or other human services rather than capital projects.
Originally titled, "A LOT of Merriment over a Potential New Tax", a key quote from Mary Post regarding the meeting's "festival" atmosphere was omitted from this article. Therefore, the title has been revised to better tie in with the graphic.
It hasn’t even been a year since Selectboard Chair Elaine Haney protested at the November 26, 2019 Joint Board Meeting that “we are in the middle of trying to educate the community about a super-important decision (merger) and mudding the waters with another super-important decision (LOT) on a really short timeline does not seem feasible to me in terms of the staff capacity, these boards’ capacity, and the capacity of our voters to fully integrate what they need to vote on.”
Having had an apparent change of heart, Haney, as well as Trustee George Tyler, appear fully behind a LOT, explaining that this new revenue source would be spent primarily on capital, not operational expenses, such as salary.
Staff members were asked to answer some of the questions raised and to continue investigating.
Acceptance of the Winter Operations Plan. Public Works Director Dennis Lutz explained there’s a nationwide shortage of qualified plow drivers. With COVID in the air, congregating won’t be allowed at the Town Garage. Just one or two absences among his highway crew will cause significant delays in dealing with a heavy snowfall or ice storm. Lutz is making efforts to keep the public informed and stressed the importance of residents staying informed to manage expectations. He explained that it will be touch-and-go this winter and service may vary from past levels. Updated Information will be available from the Public Works portion of the Town website.
Two traffic related issues. 1) A section of Sand Hill Road near Founders Road will now be designated as a 25 MPH zone. 2) Traffic ordinances for both the Village and Town have been reconciled as much as possible. Police Chief Ron Hoague explained it was not possible to create a single set of traffic ordinances that both the Town and Village could adopt. However, nearly identical draft ordinances were presented to the Selectboard and Trustees. Both were approved for continuing through the ordinance approval process. For the Town’s Draft Ordinances, the first public hearing will be on November 23rd. For the Village’s Draft Ordinances, no hearing, just an expected passage by the Trustees in the near future.
Townwide Out and About event took place last weekend, as scheduled. More on this in a future article, after the receipts from all businesses are tallied.