Sarpy County is considering asking its rural voters in November to approve a sales tax to fund public safety upgrades.
If the upgrades are approved, Sarpy would become only the second county in Nebraska to levy a sales tax.
Revenue from the proposed 1.5 percent tax would fund a needed upgrade in technology at the county's 911 center and address future building and jail needs, county officials said.
The tax revenue would not help pay for the Omaha Royals stadium under construction in Sarpy County, said County Administrator Mark Wayne.
Under state law, proceeds from a county sales tax may be used only to fund public safety improvements. The county also must appoint a public safety commission to administer the fund and authorize projects.
“You can't just throw it into the general fund,” Wayne said.
Dakota County is the only Nebraska county with a sales tax. In western Nebraska, voters in Deuel County rejected a sales tax proposal several years ago.
In Iowa, Pottawattamie County levies a 1 percent sales tax.
Few counties in Nebraska have attempted to impose a sales tax because it would have almost no impact in most of the state west of Lincoln, said Larry Dix, executive director of the Nebraska Association of Counties.
Douglas County, the Nebraska county with the biggest population, does not levy a sales tax.
The current sales tax in unincorporated Sarpy County is 5.5 percent. Increasing it by 1.5 percent would make it even with the 7 percent sales tax collected in Omaha, Papillion, La Vista, Bellevue and Gretna.
Sarpy County officials said the new sales tax would be an alternative to raising property taxes to pay for the 911 center and jail improvements.
Improving the 911 center “will be a huge expense within the next five years,” Wayne said. “We have about $10 million in radio and equipment upgrades. Whether we adopt this sales tax or not, we will have to do these things. Our current system is 15 years old.”
Through property taxes, Sarpy County residents help pay the operating costs of the 911 center, which handles emergency calls for all public safety agencies in the county. The state also allows Sarpy County and other counties to impose a surcharge of $1 per month on telephone bills to pay for 911 upgrades.
Those revenue sources alone don't generate nearly enough money to upgrade 911 equipment and improve the facility, said Joni Jones, chairwoman of the Sarpy County Board.
The tax could generate up to $3.16 million a year, according to revenue projections, including nearly $790,000 from a Walmart Supercenter under construction at Interstate 80 and Nebraska Highway 370.
Many of Sarpy County's other revenue streams are expected to drop or remain flat over the next year. The inheritance tax has dropped. State highway funds have decreased. New construction has tapered off compared with Sarpy County's building boom during much of the past decade. Property values are expected to stay about the same.
The county's personnel costs increased by $2.7 million in the current fiscal budget.
And the county agreed to partner with the Omaha Royals to build the $26 million minor league baseball stadium.
The sales tax money is completely separate from the ballpark, Wayne said.
“The stadium has no impact,” he said. The county would have proposed the sales tax to pay for the improvements “whether we were building a stadium or not.”
To help finance the ballpark and surrounding development, Sarpy County is considering redirecting revenue from keno and lodging taxes. The county currently earmarks those funds for community betterment projects and tourism promotions, including Fontenelle Forest in Bellevue.
Over the 25-year life of stadium bonds, property tax revenue generated by the development could account for $6 million in funding.
A county sales tax would not take pressure off the funds paying for the stadium, officials said, nor can any of the funds generated by the tax help pay for the new ballpark.
However, if approved, the sales tax would be levied on retail sales within the new ballpark and surrounding development, generating revenue for the county.
Only residents of rural and unincorporated areas of the county — where the tax would be levied — would be allowed to vote on the proposed sales tax. Of the 91,300 registered voters in Sarpy, 36,570 would be allowed to vote.
The proposal has been met with some skepticism.
Papillion City Administrator Dan Hoins said he is concerned about how a county sales tax could affect future annexations by the city. He said, though, that he is willing to meet with county officials to learn more about the proposal.
Jarel Vinduska, leader of the Schramm Association for a Viable Environment, said he opposes the proposal.
“Instead of making the more fiscally responsible decisions to cut unnecessary spending, the county is scratching for more revenue from the very businesses they lured here with tax incentives,” said Vinduska, of rural Springfield.
“There would have been enough money in the general fund for these services had it not been wasted and used for things like unjustifiable salary increases and the many endeavors that the county should not be involved in in these rough economic times,” Vinduska said.
Last year, 13 of 16 appointed county officials and department heads received 6.9 percent raises. In 2008, the outgoing County Board increased Wayne's pay by $15,008, in addition to a three-year contract that guaranteed him pay raises of $3,375 in 2009 and $3,476 this July, to boost his pay to $119,351.
Sarpy County Board members — who would have to approve plans to place the proposal on the ballot — seemed to welcome the sales tax proposal during preliminary discussions.
“It does make a lot of sense,” said board member Rich Jansen of rural Gretna.
Jones, the board's chairwoman, said the tax would collect significant revenue from thousands of residents of other counties and out-of-state motorists traveling the Interstate 80 corridor.
Sarpy County residents already pay an extra 1.5 percent in sales tax revenue when they shop in Omaha. “Why wouldn't we be doing this?” Jones asked.
“If we are going to continue to lose state and federal dollars, then we need to find other areas to pursue. The county sales tax is for all the right reasons, in a growing county like ours. The last thing I want to do is cut services and personnel.”
Wayne said he hopes to put the measure before the voters in November. He said he plans to research whether a portion of the proposed county sales tax could benefit other police departments and fire districts throughout the county.
“I would hope these cities and fire districts might support this type of tax,” Wayne said.
Contact the writer:
444-1056, john.ferak@owh.com
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