OV council halts sales tax increase - The Explorer: Oro Valley

OV council halts sales tax increase

Tentative budget set to be approved at May 18 meeting

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Posted: Wednesday, May 18, 2011 3:00 am | Updated: 4:28 pm, Wed May 25, 2011.

The Oro Valley Town Council put a stop to talks of increasing the sales tax rate by 0.25 percent last week, during a scheduled budget work session.

The sales tax was listed as a possible increase along with a 2-percent utility-tax increase, and other fees associated with city parks and recreation programs.

Earlier this month the council voted to doubled the utility tax to 4 percent in a 5-2 percent. The increase is expected to generate $1.3 million in added revenues in the 2011-2012 budget.

While they did not officially vote on the sales tax proposal, the council members agreed during their May 10 work session that it wasn’t needed, directing staff to remove it from future agendas.

If the increase had been approved, Oro Valley would have had a 9.325-percent sales tax rate.

Budget discussions will continue over the next few weeks, with the council expecting to approve the tentative budget after a public hearing Wednesday, May 18, at 6 p.m.

The budget, proposed by City Manager Jerene Watson, is just over $94 million, a 19-percent decrease from the current year.

Due to shortfalls, a lot of cuts were made to balance the new budget, which goes into effect July 1.

One of the major cuts was the elimination of funding for the Coyote Run Transit System. Thirteen staff positions were eliminated, and riders are being assisted in finding alternative transportation.

Assistant City Manager Greg Caton said if the council does approve the tentative budget, the final budget will likely be approved on June 15.

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