HomeMy WebLinkAbout2005-009-02/01/2005-EXPRESSING THE CITY COUNCIL'S OPPOSITION TO THE CITIZEN INITIATED BALLOT MEASURE WHICH WOULD REPEAL RESOLUTION 2005-009
OF THE COUNCIL OF THE CITY OF FORT COLLINS
EXPRESSING THE CITY COUNCIL'S OPPOSITION TO THE
CITIZEN INITIATED BALLOT MEASURE WHICH WOULD REPEAL
THE CITY'S SALES TAX ON GROCERY FOOD
WHEREAS, as a home rule city, the City of Fort Collins is authorized by law to generate
revenue through taxes, fees, special assessments and other funding mechanisms; and
WHEREAS,the City,like other home rule municipalities in Colorado,depends heavily upon
the revenue generated by its sales and use taxes in order to provide a wide variety of governmental
services and facilities that are essential to the health, safety and welfare of its citizenry; and
WHEREAS,historically,the City has used its revenue sources judiciously and has developed
infrastructure and services that have provided the residents of the City of Fort Collins with a safe,
vibrant, economically viable, and attractive community in which to live, work and raise their
families, as well as a quality of life that has been nationally recognized for its excellence; and
WHEREAS, the City's current "base" sales tax of 2.25% is the cornerstone of the City's
revenue stream; and
WHEREAS, this base sales tax is imposed on all taxable items sold in the City, including
grocery food; and
WHEREAS,a citizen initiated measure(the"Ballot Measure")has been proposed and placed
on the ballot at the next regular City election on April 5, 2005 which, if approved by the voters
would, over time, entirely repeal the City's sales tax on grocery food; and
WHEREAS, once fully implemented, the repeal of the sales tax on grocery food would
reduce City revenues by approximately six million dollars per year which represents 12.6% of the
City's General Fund budget; and
WHEREAS, this reduction in revenue would compound recent revenue shortfalls
experienced by the City as a result of a downturn in the economy; and
WHEREAS,these revenue shortfalls have already reduced the City's general fund operating
budget by approximately six million dollars per year, making the delivery of ongoing City services
more difficult; and
WHEREAS, the additional reduction in revenues that would result from voter approval of
the Ballot Measure would necessitate drastic reductions in City services that would adversely affect
the health, safety, welfare and quality of life of all City residents and would jeopardize the City's
ability to maintain the level of governmental services that have made Fort Collins an exceptional
place to live and work; and
WHEREAS,the City Council Finance Committee,working with the City Manager and other
members of City staff,has identified four cost reduction scenarios that it believes may be necessary
if the Ballot Measure is approved by the voters; and
WHEREAS, in the opinion of the City Attorney, the approval and implementation of the
Ballot Measure would violate a covenant that is contained in a 2003 bond ordinance approved by
the City council in connection with the refunding of certain sales and use tax bonds, in which the
City promised not to reduce the sales tax revenues pledged to the payment of the bonds, and such
action would unconstitutionally impair the contract thereby established between the City and its
bondholders; and
WHEREAS,the repeal of the City's sales tax on grocery food would serve no useful purpose
for low income residents of the City, since the City already has in place a sales tax rebate program
which makes it possible for low income residents to obtain a full rebate of the sales tax they pay on
grocery food; and
WHEREAS, the proponents of the Ballot Measure have publicly acknowledged that the
purpose of the measure is to reduce the size of City government which will, in turn, reduce the
number and quality of services provided by the City; and
WHEREAS, the City Council strongly believes that such reduction in services is not in the
best interests of the City, and wishes to urge the electors of the City to vote against the Ballot
Measure; and
WHEREAS, the Council Finance Committee has, after thorough review of the Ballot
Measure and its potential impacts on the provision of City services, recommended that the City
Council adopt a resolution opposing the Ballot Measure, as permitted by law.
NOW, THEREFORE, BE 1T RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that,for the foregoing reasons,the City Council strongly opposes the proposed repeal of
the City's sales tax on grocery food and urges the registered electors of the City to vote against the
Ballot Measure.
Passed and adopted at a regular meeting of the Council of the Citypf Fort Collins held this
1st day of February, A.D. 2005.
Mayor
�"—N I .k
City Clerk