MSDC board votes to support proposed Marshall use tax

Tuesday, March 19, 2013

The Marshall-Saline Development Corporation Board of Directors voted Tuesday, March 19, to offer its support for the city of Marshall's use tax proposal.

Marshall City Administ-rator Connie Latimer visited the board to provide information and answer questions about the proposition that will appear on the April 2 ballot.

She said a 2011 estimate from the state indicated the city could lose up to $42,000 in revenue if the use tax is not approved by voters.

Marshall's proposed use tax is modeled after the county use tax approved by voters in November. The use tax would be the same rate as the city's sales tax -- 1.5 percent -- and would not be an addtional tax on top of sales tax. It would only be applied to out-of-state purchases of more than $2,000 that are not subject to sales tax, according to information provided by Vote Yes for Marshall, an organization supporting the campaign for the tax.

"It's either the use tax or the sales tax, not both," Latimer said.

To put the revenue potential in perspective, Latimer said the expected gain from the use tax would have paid for snow removal during the two big late-February snow storms that hit the area.

"That would leave that money available for other services," she said.

Board member Gene Fangmann asked whether people who live outside the city but have Marshall addresses would have to pay the city's use tax.

Latimer said the tax would only apply to residents within city limits.

Residents outside the city, even those with Marshall addresses, would pay the county's use tax on qualified out-of-state purchases. She also noted that the tax is most likely to apply to out-of-state vehicle purchases.

"To me, it's something we ought to do," said MSDC Executive Director Bill Riggins. "People have been paying it up to a year ago."

Riggins referred to a state Supreme Court ruling last year that ended the practice of applying sales tax to out-of-state purchases.

Use tax measures being proposed by local governments throughout the state are intended to maintain the former revenue source in a way that complies with the state constitution.

In other business, the board voted to amend its bylaws to allow more flexibility in adding members to the board.

Precipitating that issue was the recent addition of two contributing members, Saline County, which returns after a three-year hiatus, and a partnership between the city of Slater and Exchange Bank.

To be represented on the board, a member must contribute $10,000 or more annually to MSDC.

According to the existing bylaws, additional board members could only be added at the organization's annual meeting.

Stan Moore of MSDC said the revision would allow additional members to be added when they qualify to have representation.

The new contributing members now can place representatives on the board as soon as possible.

Finance Committee Chairman Gene Fangmann noted that with the two new contributing members and a $5,000 donation from Wood & Huston Bank, which was presented in February at the economic development plan launch event, the organization's budget is looking strong.

In addition to Fangmann, President Jene Crook, Kyle Gibbs, Scott Hartwig, Larry Holland and Greg Swift were present.

Contact Eric Crump at ecrump@marshallnews.com

Online:
www.marshall-saline-dev.com

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