VOL. 129 | NO. 153 | Thursday, August 7, 2014
Sales Tax Hike Clears First Hurdle
By Bill Dries
After lingering for several weeks as the politically charged environment at City Hall has subsided some, the idea of a city sales tax hike to restore funding for health insurance cuts to city employees and retirees is moving. But it may not get very far.
The Memphis City Council approved Tuesday, Aug. 5, the first of three readings of an ordinance that would put a half-cent sales tax hike on the November ballot for city voters.
The referendum, proposed by council member Janis Fullilove, would ask voters to raise the local option sales tax rate by half a cent, with 80 percent of the revenue from the increase going to police and fire services to reverse health insurance cuts the council approved in June. The remaining 20 percent of the revenue would go to the city’s bond debt service fund.
Fullilove began moving on the referendum ordinance although it is unclear whether there is enough time to put the question on the November ballot.
She said she had been told the council must approve the ordinance on third and final reading by Labor Day in order to meet deadlines in election law for such matters. Approval on first reading Tuesday would put third reading past the Labor Day holiday.
The idea of a sales tax hike creating an estimated $47 million in additional revenue was suggested by Memphis Police Association President Michael Williams last month at the height of council day protests at City Hall.
Memphis Mayor A C Wharton Jr. has said he is not for such a sales tax hike. In a year’s time, city voters voted down two sales tax hike ballot questions – one a countywide sales tax increase in which city voters were the bulk of the electorate on the ballot question.