Editorials - Lubbock Online.comSales Tax: Vote Yes

Published: Sunday, January 11, 1998



The editorials represent the opinion of the




Sunday, January 11, 1998Last modified at 3:37 a.m. on Sunday, January 11, 1998

Sales Tax: Vote Yes

LUBBOCK VOTERS will go to the polls this Saturday - in great numbers, we hope - to cast ballots on one of the most important issues facing the community in the closing months of this century. The question: whether to approve the levying of a 3/8-cent sales tax to promote economic growth.

Our recommendation is simple and sincere: Vote yes.

After hearing all the pros and cons, we are convinced that the tax represents a vital tool in efforts to secure Lubbock's future by attracting new industry and aiding the growth of existing businesses.

We are convinced, too, that many citizens perhaps do not fully appreciate the consequences of Lubbock's failing to be a vigorous competitor among other cities vying for new businesses and new jobs.

We have heard a recurring, anti-growth argument that says, in essence, "we don't want to be like Dallas or Houston." How's that? Not want Lubbock to thrive, to prosper, to grow? This strikes us as a terribly short-sighted attitude.

Cities either grow or they stagnate

The hard reality is that cities that do not thrive and grow do not have the luxury of standing pat. A city grows or it begins to stagnate and contract, in an economic sense.

Economic growth in the form of new industry - and jobs - broadens a city's tax base, so that tax burdens are shared by more people and by more ventures. Conversely, failure to expand the tax base acts, at the very least, to deprive the community of the means of easing ongoing tax burdens.

We as a community are looking at an economic situation that, while far from hopeless, has worrisome negatives: the closing of Reese Air Force Base, the impending end to farm subsidies and the loss of medical-related jobs from the merger of two major hospitals, Methodist and St. Mary of the Plains.

In an attempt to offset those and other economic losses, the city two years ago formed an economic development unit - Market Lubbock Inc. - to seek out and try to lure new businesses to set up shop in Lubbock. Market Lubbock Inc., was allocated 3 cents per $100 valuation of the local property tax, or about $1.6 million a year, for its activities.

Granted, $1.6 million sounds pricey, but it pales in comparison to, say, Amarillo's $9 million a year, which is brought in by a half-cent sales tax for economic development.

Abilene's 'growth' program is a model

Others in the area have jumped ahead of Lubbock in the pursuit of economic-growth opportunities. Abilene in 1989 became the first city to pass an economic development sales tax (1/2 cent). Littlefield has had a similar levy for four years. Big Spring and Wichita Falls have taxes for economic development. Odessa voted one in November.

Abilene is perhaps the best example of how economic development programs can brighten a city's future. With its levy generating about $5 million a year - Lubbock's, remember, is $1.6 million - Abilene has been able to attract a carbon fiber manufacturer that has invested $56 million in equipment and has brought in 200 new jobs, a Blue Cross & Blue Shield claims processing center with 330 new jobs, a U.S. Postal Service coding facility with 300 new jobs and an aircraft maintenance operation with 250 new jobs.

Hear this from Othena Donelle, head of Littlefield's economic development office: "Littlefield is very competitive with Lubbock because of our economic development sales tax, just in the same way Lubbock could be very competitive with Dallas and Houston with economic development money."

Tax would cost average family $40 year

What might we expect to be the fruits of our enacting such a levy? Well-studied proponents of the tax say it has the potential of attracting perhaps 700 more jobs a year for about 1,400 people. Those 1,400 could derive something like $13 million in personal income that could generate $10 million or so more in local retail sales per year.

The cost of an economic development tax to an average Lubbock household? About $40 a year, according to Bob Bearden, economic assistance coordinator for the Texas Comptroller of Public Accounts.

Forty dollars a year, or less than a dollar a week in taxation - that, to us, sounds like an extremely modest price to pay for an economic-growth undertaking having a potential pay-back in the millions of dollars.

And, we are reminded, certain major items would be exempt from the proposed tax, including groceries, house payments, medical bills, home utilities, cars and gasoline.

Contrary to what others have said, Lubbock's enactment of an economic development tax would not put the city into uncertain and uncharted terrain. State law restricts how the tax revenue could be used. Citizens have the power to call a repealing vote at anytime, so long as no unpaid debt exists.

Across Texas, the citizens of 340 cities have voted similar taxes. That means the competition for attracting new businesses already is widespread and intense - and Lubbock is barely in the game.

If local voters opt to vote down Saturday's proposal, Lubbock definitely will be marching to the beat of a different drummer. In view of the possible consequences, the drumbeat might become a dirge.

We hope, however, that Lubbock citizens will march to the ballot boxes with a more optimistic view and will vote Yes! on the question. That Yes! can have tremendous consequences for life in Lubbock now and beyond the year 2000.