Hessmer considering sales tax proposal

 

   Saying it is a “tax for the future” of the village, Hessmer Mayor Travis Franks asked the three-man Village Council to consider putting a sales tax proposal on the November ballot that would add 1 cent of sales tax and reallocate the current 1 cent sales tax so it can be used to support a comprehensive bond issue to improve  Hessmer’s streets and drainage.

   Franks said the current 1 percent sales tax generates about $70,000 a year, but is divided among the village’s various departments in such a way that it cannot support a significant bond issue for capital improvements.

   Town Engineer Brendon Gaspard conducted a study of the village’s streets and drainage to determine an approximate cost of a village-wide improvement project. Gaspard told the council that reconstructing every street in town and making needed drainage improvements would cost over $1.1 million.

   He said a 1 percent sales tax dedicated solely to streets and drainage would allow Hessmer to support a $600,000 bond issue, to be repaid over 15 years. “That’s a little over half of what would be needed to do every street and drainage project,” he said. It would also require the council to “set priorities for projects” and leave some projects undone in the bond-financed effort.

   Franks said that could be avoided if the current 1 percent sales tax could be reallocated to support capital improvements.

   The mayor said some of the sales tax goes to roads, some to drainage, some to water and sewer, and some to the village’s General Fund to support police, Town Hall administration and other costs of operating the village.

 

   The only department that might feel a pinch if the funds were reallocated would be the General Fund, he said.

  The council was told that the water and sewer departments are self-supporting. The street and drainage needs would be included in the reallocation.

   The General Fund receives about $10,500 a year from the current sales tax.

   Franks’ proposal was immediately favored by Councilman Keith Armand, who said “we need this.” He noted that the village must fix its own streets and address its own drainage problems because it is not likely to get any assistance from state and federal grants or from the Avoyelles Police Jury.

   Councilman Josh Roy said he would review the information from Gaspard before a vote is needed on the matter to start the process of getting it on the Nov. 21 ballot.

    Councilman Don Bernard also said he would have to review all of the paperwork on the proposal before he could support it.

   Gaspard said the village can commit up to 75 percent of a sales tax’s revenues to support bond issues. If Hessmer had 2 cents of sales tax to support a bond issue, he said it would be enough to finance a 15-year bond issue of $1.2 million.

 

   Gaspard said the estimated cost of the project could be reduced if a more detailed inspection found some streets would not need total reconstruction.  He said some may only need resurfacing.

  Franks said he would like to be able to tell the citizens of Hessmer that if they approve the proposal in November, all of the streets would be done in 2016. 

   If the proposal is placed on the ballot, the current 1 percent sales tax would remain in force under the present allocation formula if the measure is defeated.

   If approved, the current sales tax would be reallocated solely for capital improvements and a second 1 percent sales tax would be added shortly after the election, also dedicated to capital improvements.

  The council will need to adopt a resolution stating its intent to call the election for Nov. 21 at its August meeting, Gaspard said. The council will meet on Aug. 10 -- a week later than usual due to the need to officially adopt the property tax millage rates for the coming year. It would call the election at is September meeting and submit the call to the Secretary of State’s office. It would then be put on the ballot for November. 

   “Nobody likes taxes,” Gaspard said, “but nobody likes bad roads and poor drainage, either.