A one-cent sales tax and three property taxes will go before Lake Charles voters for renewal on Nov. 8. Together they account for 26 percent of the city’s overall revenue, and voters will decide whether to renew them for another 10 years.
City Council President Rodney Geyen said all four taxes are essential to keep the city functioning. The renewals would in no way increase taxes, he said, but simply enable the city to keep collecting at its current pace.
The one-cent sales tax up for renewal is part of the 21⁄2 percent sales tax the city now collects. The penny portion would generate $25 million to fund a variety of city services, such as trash collection and infrastructure maintenance, city officials said.
Voters narrowly approved a quarter-cent sales tax last year, raising the city’s rate to the same level as the rest of the parish. Mayor Randy Roach said approving the penny tax would ensure that Lake Charles stays at that parish rate — a rate well below the average for city sales tax rates in Louisiana, according to the Tax Foundation.
He said Lake Charles’ operating budget is structured to rely heavily on sales tax collections, while some cities rely heavily on property taxes. Relying more on sales tax collection ensures that everyone who uses the city’s services — property owners, renters and visitors — are paying toward the services they receive, he said. But he said property taxes are still an essential revenue source.
The three property tax rates up for renewal together comprise 9.28 mills of the city’s 15.35-mill property tax.
Under the full 15.35 mills, a person with a $100,000 home would pay $153.50 each year in property taxes. Voters will decide on $92.80 of that. Property taxes are taken up each year, and each millage pays for certain city services.
The 2.31-mill tax up for renewal would generate $1.4 million and go toward building, street and bridge maintenance. The 1.7-mill tax would generate about $1 million and be used to maintain playgrounds and recreation centers. The 5.27-mill tax would generate $3.3 million and go toward pay increases and starting salaries for police, fire, public works and other city workers.
City Administrator John Cardone said that if the taxes aren’t renewed, the city would have to make major budget changes and would ultimately be unable to maintain its current level of service.
Roach also stressed the importance of renewing the taxes. “We’re renewing 40 percent of our sales tax and 60 percent of our property tax — that’s a major portion of the operating revenue,” he said.
He said the city’s credit rating on bonds would suffer as well if the renewals don’t pass. “The bottom line is, if we don’t renew these taxes, I don’t see how we could keep the rating, and that would have all kinds of implications,” he said.
Roach addressed statewide concern about Louisiana’s combined sales tax rate, which is now the third highest in the nation. He said the Legislature is working to repeal the penny sales tax added in last legislative session — which was only intended as a temporary fix — and that he expects the state to develop other revenue sources in the near future.
He said that, in the meantime, a vote for the city tax renewals would in no way add to the burden, but only help residents maintain their current level of service from the city.
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