Council Ponders Sunset On Rental Tax

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The Star Valley council is inching closer to demolishing the 2-percent rental tax.

At Tuesday night’s council meeting, councilors all but agreed the tax, which applies to people leasing or renting property, should be rescinded.

The question is whether the town can afford to do away with it.

In February, Town Manager Tim Grier informed the council the tax brings in around $50,000, or 12 percent, of the town’s operating budget. Grier said the amount is probably closer to $60,000 today. All of that money is designated to the law enforcement fund, which the town no longer needs since it decided not to create its own police force several months ago.

So, if the money is no longer needed, why keep the tax, the council asked.

“I believe it is an unfair tax,” councilor George Binney said.

Councilor Vern Leis agreed, saying it does not bring in a substantial amount of money.

“I would like to see a sunset put on it,” he said.

A sunset clause sets a date when the tax is rescinded. Leis proposed if they do away with the tax, they put a sunset date no later than 90 days.

Councilor Barbara Hartwell said although she does not support the tax, this is the wrong time to eliminate it.

“I think the timing is very, very bad,” she said.

“We need to leave it in place because where are we going to get the money to replace it?”

The council directed Grier to draft two ordinances, one with the sunset clause and one without, for the next council meeting.

Also at the meeting, the council:

• Gave final approval to the town’s $9.3-million budget.

“It has been a long road to get here, and all the statutory steps are completed,” Grier said.

“I am glad to say we are doing a little better than the state of Arizona.”

• Approved a relocation assistance plan that only applies if the town demolishes a home. Binney opposed the resolution.

• Tabled a $420,000 transportation enhancement grant that would “beautify Highway 260.” Councilors worried the proposed synthetic grass would be hard to maintain, and would deteriorate in the Arizona heat.

“The government is spending so much money right now and if we do this we are part of the problem,” Binney said.

• Appointed Scott Popke to the planning and zoning commission for three years.

• Acknowledged the Gila County Sheriff’s Office for a smooth transition from the Payson Police Department on July 1.

• Grier updated the council on the town hall remodel. Bids are coming in higher than expected and it should cost at least $60,000 to convert the garage into a meeting space.

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