Source: Lexington Herald-Leader
Kentucky’s unwieldy, outdated constitution doesn’t allow voters in towns and cities to decide to levy a sales tax on themselves.
House Bill 1 in this legislative session aims to begin the process of fixing that by creating a local option to levy a sales tax, and legislators should give it swift approval.
While “tax” is about as dirty a word as there is politically, this is a process so replete with safeguards that even the most anti-tax lawmakers should be able to support it.
First, the vote is to put a proposed constitutional amendment on the ballot. Ultimately, Kentucky voters, not legislators, will decide whether or not to adopt it.
Second, if it is adopted, no mayor or city council would be able to impose the tax on unwilling voters. A sales tax increase can only be approved when a majority of voters in a general election support it.
Third, the proposed amendment clearly limits how much tax can be added for how long and for what purposes. Those limits are that no more than a total of one penny in sales tax can be added for a specified time to support specified capital projects. When the time is up or the project is paid off, the added tax expires.
More important than the limitations are the potential benefits of giving local communities this taxing authority.
Kentucky relies on the economic activity of its urban areas for the lion’s share of state revenues but provides relatively little support for them in terms of large capital projects, and often in dribs and drabs from one budget to the next. This makes it harder and more expensive to plan and carry out large, multi-year projects.
That’s why a broad coalition of business and political leaders across the state support HB 1.
It will allow communities to plan and pay for improvements to enhance civic and economic life without going hat in hand each budget session to Frankfort.
This issue is truly bipartisan, in both support and opposition.
Some conservatives oppose it because it expands taxing authority; others support the concept of local control. Liberals support it as a way to finance important projects for public benefit but others see any increase in the regressive sales tax as unacceptable.
The bill, with strong support from House Speaker Greg Stumbo, D-Prestonsburg, and Minority Floor Leader Jeff Hoover, R-Jamestown, has a good chance of making it out of the lower chamber.
In the Republican-controlled Senate, where President Robert Stivers, R-Manchester, acknowledges there are “mixed emotions,” the path is less clear.
Local control should be the final winner in this debate. It is not for theorists in Frankfort to deny local voters the right to tax themselves.
Likewise, while there’s no arguing about the regressive nature of sales taxes, local leaders will have to make the case to voters that the community will get its money’s worth.