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Alexander. Cynthia From: ent: (0: Subject: Lewis F. McLain. Jr. [Iewis@mclaindss.com] Tuesday, September 21,20047:21 AM alexanderc@ci.la-porte.tx.us Baytown: sales tax for street repairs, approved by 55 percent of voters, goes into effect October 1 City sales tax increasing to 8 percent Oct. 1 By Kristopher Banks Bay town Sun Published September 21, 2004 BAYTOWN - Beginning a week from Friday, the sales tax rate goes up within city limits to eight cents per dollar. Voters approved a new quarter-cent tax, to be used exclusively for street repairs, in the May 15 election with 55 percent of the vote. The new tax goes into effect Oct. 1. The tax rate is currently 7.75 percent. The sales tax increase means that for every $100 people spend in Bay town on taxable items, they spend an extra quarter for sales tax. Non-taxable items include groceries and medicine. The tax also does not apply to automobiles. Money from the tax can only go toward repairing paved streets that existed on May 15, according to state law. The city estimates that the quarter-cent sales tax will bring in $1.5 million per year, based on a 1 percent sales tax bringing in ~6 million per year. A state law grants smaller municipalities to charge up to two cents more than the state sales tax, making 8.25 percent the maximum sales tax. After the 6.25 percent state sales tax, 1 percent city general fund tax and half- cent municipal development district tax within Harris County, the city has room to charge up to a half-cent more on sales taxes under state law. The tax is not required to have a governing board by law, and City Council will determine how the money is used. Mayor Calvin Mundinger has suggested forming a citizens committee to make recommendations on where the funds should be spent, though he could not be reached Monday. The city will use already-existing data on street conditions to determine which streets are most in need of repair. The data exists from studies the cities used to determine which streets should be repaired City Clerk Gary Smith said city administration will recommend a three-pronged approach to spending the tax money. Under the recommendation, $300,000 per year would be spent on sealing cracks in road foundations, which is supposed to add longevity to the road, and $200,000 per year on repairing concrete. Two-thirds of the money, about $1 million, would be spent on rehabilitating about six miles of road per year. Under this portion of the funding, if less than 35 percent of a road needed repair, the surface would be milled off, the road's base repaired and new asphalt would be laid down. Though city administration will make recommendations, Council will have to 1 !"".~