City Council Agenda and Packet 2010 08 03

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City Council Meeting Minutes July 20, 2010 Page 3 of 9 CONSUMPTION OF ANY ARTICLE OFTANGIBLE PERSONAL PROPERTY OR TAXABLE SERVICES PURCHASED,LEASED OR RENTED FROM SOURCES OUTSIDE THE CITY ON WHICH THECITY SALES TAX HAS NOT BEEN PAID AND UPON RENTAL OF STORAGE SPACEWITHIN THE CITY AND, IN CONNECTION THEREWITH, MAKINGAMENDMENTS TO THE LOUISVILLE MUNICIPAL CODE TO ALLOCATEPORTIONS OF THE USE TAX REVENUES FOR OPEN SPACE AND HISTORCIALPRESERVATION PURPOSES, PRESCRIBE EXEMPTIONS FROM THE USE TAX,AND ADOPT OTHER AMENDMENTS CONCERNING THE ADMINISTRATION ANDCOLLECTION OF THE USE TAX; AND PROVIDING FOR THE SUBMISSION OFTHE ORDINANCE TO A VOTE OF THE REGISTERED ELECTORS AT A SPECIALELECTION TO BE HELD NOVEMBER 2, 2010 Mayor Sisk requested a City Attorney introduction. City Attorney Light read Ordinance No. 1575, Series 2010and noted there are second reading amendments, including the amendment to the title. Mayor Sisk opened the public hearing and requested a Staff presentation. City Manager Fleming explainedtheCouncil directed staff to prepare a draft ordinance with ballot language related to imposing a use tax for consideration. The City completed phone surveysof Louisville voters, and discussed the current budget situation with various community focusgroups. Staff prepared a list of items Council may wish to add back into the City’s budget should the use tax pass.If approved by the voters, the ordinance and ballot question is structured so the tax revenue would be used in the same manner the City currently uses the sales taxfor historic preservation projects, land acquisition and parks maintenance and general government activities. Potential uses of revenue if the use tax is approved by the voters included filling the two vacanciesin the police department; restoring the services cut within the last two years and providing a “Rainy Day Fund”. He noted one of the challenges is to determine the fiscal impact of the use tax. It is difficult to accurately predict the revenue this tax would generate, especially in the first year because it would reflect changes in building activity and business expansions. Staff estimated, with ConocoPhillips and other large developments coming in 2011, the commercial building use tax would increase approximately $275,000. Expanding the use tax to cover residential building materials would likely generate an additional $285,000 in revenue. The base consumer use tax for appliances, furniture and fixtures would generate$900,000 in additional revenue.Under the provisions of TABOR, the ballot title must specify the maximum amountof tax revenue the measure would generatefor the first year. Staff believes $1.5 milliondollars represents the best estimate. If the actual revenues exceed that amount, the excess must be refunded. Mayor Sisk requested public comment. There were nocomments. 18