No change to utility tax in Oro Valley - The Explorer: News

No change to utility tax in Oro Valley

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Posted: Wednesday, October 23, 2013 4:00 am

Residents of Oro Valley will not see a reduction in their utility bills after the council unanimously directed Town Manager Greg Caton to look no further into exploring the tax decrease as preparation for the town’s five-year financial forecast approaches.

The residents that would have been subject to the decrease include those making use of water services from the City of Tucson, Metropolitan Water Company, and the Oro Valley Water utility, as well as electric power service from Tucson Electric Power and natural gas from Southwest Gas. 

Inclusive of a two-year sunset clause, the utility tax was increased from 0 percent to 2 percent in 2007, and increased again to 4 percent in 2011, where it will remain.

During last week’s regular session, council cited increasing expenditures and decreasing revenues as the reason for rejecting a decrease. Utility tax collections for fiscal year 2012/13 amounted to $2,756,039.

Councilman Joe Hornat said maintaining the tax is necessary to ensure sufficient revenue streams for the town and the services it provides to residents.

“I don’t think anyone here likes taxes,” said Hornat. “If we didn’t have to have them, we wouldn’t have them. In this case, we’ve got a tax that we need.”

Oro Valley resident Bill Adler said it’s time for town residents to step up and do their part. Because the town is nearly built out, he says revenue options will eventually become increasingly scarce if not properly monitored.

“The community needs to become accustomed to contributing more, not less,” he said. “We may be getting a false sense of exuberance with regard to (economic) recovery because several hundred homes are being built, but the fact remains we are running out of space, whether that’s commercial or residential development, and the diversification of revenue streams is an imperative, it’s not really discretionary. It’s a requirement.”

Council was also unanimous in its vote allowing La Mesa RV to host a four-day display and sales event at the Oro Valley Marketplace in a vacant lot north of Red Lobster.

The event, which will run Nov. 21 – 24, will have between 100 and 150 recreational vehicles displayed for sale. The event will run from 9 a.m. to dusk. 

Oro Valley will not receive any of the sales tax from the event, as the transfer of ownership on vehicles sold is set to take place outside town limits.

While Caton says that is unfortunate, he says future negotiations will likely explore how to keep some of that money in the town.

For now, the economic impact the marketplace will see from RV shoppers is a solid starting point, he said.

“In the short term, we see it from the staff perspective as a special event, which certainly drives activity in the area, which is an economic positive, not only directly to the businesses, but to the Town of Oro Valley,” said Caton.

Two residents, Donald Bristow and Bill Adler, said the item should be more closely reviewed before proceeding. Bristow said town code does not allow for such events on the designated lot, while Adler requested that staff of La Mesa RV take a more active role in making the event site more aesthetically pleasing. 

The agreement allows for a maximum of three events until Dec. 31 2014, though each event will require an individual special use permit.

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