It’s a competitive global environment out there, and quality of life and the strength of infrastructure are more important than ever in attracting and retaining the talented workforce local communities need to thrive. In Kentucky, however, we simply don’t offer our citizens – both urban and rural, all the tools they require to control their own destiny when it comes to less reliance on Frankfort and Washington, DC.
Yet some states are taking an approach Kentucky needs to strongly consider. As Kentucky struggles with funding the basic needs of our citizens, I believe we can look to Florida as an example of a place that is offering more autonomy, and in turn, creative solutions to funding essential infrastructure and moving local communities forward.
Florida, like most states across the country, is grappling with serious budget issues. And while cuts have been made, services halted, and construction projects put on hold, some communities have taken matters into their own hands using a tool known as a local option sales tax to fund local projects.
Here’s how it would work in Kentucky as proposed by a coalition of Kentucky business and civic leaders called Local Investments for Transformation (LIFT): local citizens express a desire for a new infrastructure project, and they vote on whether or not to impose a temporary (must contain a built-in sunset provision) sales tax of no more than 1% on themselves. I personally prefer a ten year limit.
Communities across Florida, and the 36 other states which allow for local option sales taxes, have more power to shape their futures than we do in Kentucky. The bottom line now is that the federal government and state governments are not making necessary expenditures in important infrastructure and economic development projects in our communities. Infrastructure spending as a percentage of GDP has been cut in half in the U.S. since 1960.
In Walton County, Florida (where my wife and own property and visit regularly to enjoy some sunshine) for instance, it was a critically important road project that the state and the federal government had not made a priority. For over 40 years, the citizens of the area had grappled with how to get across the Choctawhatchee Bay in a timely manner over US 331. Most concerning, though, were hurricane evacuations. Local leaders selected this project as the top priority and sold the concept to enough local citizens who approved a half cent increase in their local sales tax to fund an expansion of U.S. 331 and a new four lane bridge over the bay. The State and Federal governments then matched some of the funds and the project is now on target to be completed in 2016, making travel faster, and in an emergency, much safer.
In Bay County, Florida (Panama City), the local leaders determined that upgrading technology in the K-12 class rooms was a top priority. I got initially exposed to the campaign at a Rotary meeting presentation. A 12 cent increase in the sales tax (ten year limit) passed, and I have since visited an Elementary school to see the powerful results.
If this tool was available here in Kentucky, it would allow local citizens to decide for themselves if they want to implement a temporary tax to pay for a specific infrastructure projects, just like they’re doing in Florida.
What I have witnessed in Florida is exceedingly healthy. Local leaders are forced to prioritize and then to campaign to sell the voters on the top priority. The process creates community leadership, or it does not pass.
When lawmakers meet in Frankfort next year, I hope they give Kentuckians a chance to decide for themselves if they would like a local option to fund the projects they need. A broad coalition including the Kentucky Chamber, the Paducah Chamber, the Kentucky League of Cities, the Kentucky Association of County Officials, and the Kentucky Association for Economic Development, among others, are speaking in favor of this this tool.
I encourage every reader to contact your lawmakers at 1-800-372-7181 and ask them to support a local option. It’s time for Frankfort to allow local communities to have more control over their own future.
John A. Williams is founder and chairman of Computer Services Inc. Williams served as chairman of the board of the Federal Reserve Bank of St. Louis, Louisville Branch for three years and was a member of the Governor’s Tax Reform Commission. In 2009, he was inducted into the University of Kentucky’s Gatton College of Business and Economics Hall of Fame.