The Jefferson City Council has put its seal of approval on the 2016 budget, which includes an increase to the city's gross receipts utility tax rate from 5.65 percent to 6 percent.
At the City Council meeting Tuesday, the final balanced $30 million general revenue budget was passed by a vote of 8-2, with 4th Ward Councilmen Carlos Graham and Glen Costales being the only two opposed.
Graham and Costales said they voted against the budget because of the tax increase, with both noting they believed money could have been found elsewhere in the budget.
"People are tired of taxes, taxes, taxes," Graham said. "I was voting with my constituents."
The council has been working on the 2016 budget since the end of July, making a number of changes to the draft presented by Mayor Carrie Tergin. The approved budget includes a utility tax rate increase to 6 percent, which is estimated to raise $294,000 in new revenue, which would be used to address the city's vehicle replacement and maintenance needs.
The city's gross receipts utility tax is capped at 7 percent; to increase the rate any higher would require a public vote. The telephone tax has remained at 7 percent for years, but the gas and electric taxes were lowered to 6.55 percent in 1982 and to 5.65 percent in 1984.
Before the budget bill was debated and voted on by the council, Joe DeLong, president of DeLong, Inc., spoke in opposition to the increase saying it could jeopardize the city's plans to seek a renewal of the half-cent capital improvement sales tax, which is expected to be on the ballot next year. DeLong said the increase also unfairly targets his business, as both ABB and Unilever have rate caps established by city code.
Due to prior agreements with the city, ABB Power and Unilever have caps on how much they can be charged. The amount is adjusted for inflation each year and currently has a limit of $39,152.
The state Capitol complex also is capped, as outlined in city code. The amount also is adjusted for inflation each year and currently has a limit of $115,175.
"The tax is discriminatory against us as a business," DeLong said. "I think it defies common sense that there's no way revenues can be raised any other way than this."