Saturday, March 26, 2011


I’m in favor of all things “GOOD FOR EXCELSIOR” I love this town! Sometimes achieving the best for things we love requires thoughtful discussion. That's this mission of this blog.

I got a text from Eric Copeland asking me to comment on Steven Fines statements about the proposed ½ cent Economic Development sales tax. I was apparently quoted in a Standard article yesterday; since the article isn’t online I don’t “know what I said” (looking forward to a real online paper). Steven’s observations made me do some research. (Steven, move to Excelsior and run for office.)

The ED tax was run in Feb 2010 in a predictably low turnout election, I was on the committee that that promoted it. The timing of that election was influenced by a perceived urgency that we might lose the Elms. The tax failed, we still have the Elms.

Many experts agree “economic development sales tax” is a contradiction in terms arguing that increased taxes counter economic growth. Certainly sales tax impacts lower & middle class income households by percentage of disposable income more than higher income households. I believe well utilized taxes serve all classes. The presented reasons for this tax increase are jobs creation that could augment lower & middle class income and countering Kearney’s Southeastern expansion strategy.

A ½ cent tax should generate approximately $700,000 annually in additional revenue (if it develops new business, more). Approximately 40% of this comes from out of town shoppers meaning Excelsior citizens will contribute about $420,000 per year to the fund (that’s about $100 per household in ES). An Economic Development Director will be hired to manage the day to day process, 10% (about $70,000 per year) or more will probably go to salary/management fees (there’s a good paying job the tax will create).

The city cannot “pre-earmark” these funds so they will be utilized at the discretion of the City Council of today and future. Primary stated goals are to acquire and develop industrial development tracts and annex land mostly to the west. I’m fairly sure this stated desire for land will increase property values in the targeted areas. Neither of these actions are directed at businesses that directly generate new taxable sales unless Owen Lumber and Pour Boy agree to annex, I hear they’re not interested. I haven’t heard discussion of the additional costs of providing city services and public safety but I’m sure we’ll need to hire more Fire and Police officers if new businesses do come to the city (more new jobs).

Over the next 10 years we’ll pay $7,000,000 more taxes based on our confidence in the effective utilization of the money by elected officials.

Transparency requires disclosure of a committee actively beginning a campaign for a ½ sales tax for a Community Center so we’re really considering the possibility of a 1c sales tax increase.

What do you think, is it “GOOD FOR EXCELSIOR”?