The Ottumwa Courier

Local News

February 5, 2013

Eldon gets second chance at LOST

1 percent sales tax means nearly $100,000 a year

OTTUMWA — The city of Eldon will get another shot at renewing its Local Option Sales Tax next month.

In November’s general election, voters in the cities of Agency, Blakesburg, Chillicothe, Eddyville, Kirkville, Ottumwa and the unincorporated areas of Wapello County approved the renewal of the 1 percent sales tax in their respective municipalities.

But voters in the city of Eldon defeated the measure: 149 voting “Yes,” 151 voting “No.”

In a forum before the election, Eldon Mayor Shirley Stacey said her city’s LOST revenue has benefited the library, fire and police departments, cemetery, new equipment and street repairs.

“If Eldon did not have this tax revenue, we would have to cut the services of those departments, along with the maintenance of streets and upgrading of equipment,” Stacey said. “We could not support what we have on water, sewer and garbage revenues alone.”

Currently, LOST sunsets on Dec. 31 this year. The measure would extend the tax from Jan. 1, 2014, to Dec. 31, 2025.

If the measure does not pass in this special election, the tax will end, dropping from 7 to 6 percent.

Stacey said the small town of 927 people sees $96,000 each fiscal year from the sales tax.

“It’s a lot that’s going to be missed if we don’t [renew it],” she said.

The tax was originally implemented in Eldon in January 2002 and has been in effect ever since.

The money goes into Eldon’s general fund, which is then used for the Eldon Library and the volunteer fire and police departments.

“It also helps when we have a sewer line break,” Stacey said. “We were able to pay for that because the money was available. And it helps get us out of debt at the end of the year.”

The city has been planning its budget as if the sales tax renewal does not pass, though Stacey is hoping it will. The Eldon City Council will vote to approve the city budget for fiscal year 2013-14 at its next meeting on Feb. 12.

“We know we’re going to have to make some cuts if it doesn’t pass or possibly raise the property taxes,” Stacey said.

Some preliminary cuts the city has figured into the budget include street repair and cemetery maintenance, she said.

“After the election, if we don’t get it, we’ll be going back and looking at making more cuts,” she said.

Last year and already this year, two storm sewers have collapsed on Third Street in Eldon, each totaling $30,000 in repairs.

“Without that local option sales tax, we just would not have been able to make that repair without going in debt,” she said.

The measure was barely defeated by two votes in November, but 86 of Eldon’s 386 ballots were “under,” meaning those voters didn’t vote one way or the other on the measure.

“I’ve talked to a number of people who didn’t understand what it was and voted, ‘No,’” she said.

Since the back of the ballot included judicial retention as well as the sales tax renewal, Stacey said that could be the main reason why it was defeated.

“A lot of people say, we don’t know them [the judges], we don’t care who’s appointed,” she said. “It’s just something that they look on the front side, check those and the judges they don’t worry about. It was either a matter of not understanding or not turning the ballot over.”

Stacey stressed that the tax is not a new tax.

“We will still pay that tax any place else we shop,” she said. “It’s still in effect in Ottumwa, really the rest of the county. We will still pay that tax, we just will not receive revenue from it.”

The amount of dollars Eldon sees in its general fund from LOST is significant because the city’s population is so small, she said.

Eldon residents will have a chance to learn more about the tax at a forum at 1 p.m. Feb. 24 at KD Center.

Stacey, as well as Eldon City Councilman Jerry Potts, Eldon City Clerk Carrie Teninty, Wapello County Supervisors Jerry Parker, Ottumwa City Councilman Brian Morgan and Blakesburg Mayor Jason Myers will all be in attendance to answer questions.

In the coming weeks, Stacey said she will also be taking a question-and-answer sheet door-to-door to her citizens to inform them of the tax renewal and allow them to ask questions.

“Some of them just don’t understand,” she said. “So if they can ask another citizen about it, it might be helpful.”

The special election will also allow voters to fill a vacancy on the Eldon City Council. Roger Gosnell is the sole candidate on the ballot for the position.

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