Decision Points

September 2010 - Posts

City Council calls election to expand uses of economic development sales tax

The Round Rock City Council has called for a Nov. 2 election to ask voters if they are willing to expand the allowable uses of the City’s economic development sales tax.

Approved by voters in 1997, the half-cent sales tax is restricted to transportation projects that promote economic development. The election would determine whether the City can expand the purposes of that half-cent sales tax to all uses allowed by state law.

If approved, the ballot measure would not impose a new tax or raise the existing sales tax rate.

“We are asking voters to provide the City with more flexibility in how to use the revenue from the existing economic development half cent sales tax,” Mayor Alan McGraw said. “In Texas alone, we are competing for jobs with nearly 600 cities that do not have any similar restrictions on the use of their economic development sales tax.”

Texas Local Government Code Chapters 501 and 505 is the section of Texas law that contains the rules governing the use of the “Type B” economic development sales tax, including eligible uses of tax revenues.

Among the allowable uses of the “Type B” sales tax are: projects for the promotion of professional and amateur athletics and sports including stadiums, ball parks, auditoriums, projects related to entertainment, convention, tourist, and exhibition facilities, amphitheaters, concert halls, and public parks, park facilities and events, open space improvements, military facilities, including closed or realigned military bases, primary job training facilities for use by institutions of higher education, research and development facilities, regional or national corporate headquarters facilities, museums and related stores, restaurant, concession, and automobile parking facilities, related area transportation facilities, and related roads, streets, and water and sewer facilities, recycling facilities, and projects to promote new or expanded business enterprises that create or retain primary jobs, and public safety facilities, streets and roads, drainage, and related improvements, demolition of existing structures, development and expansion of affordable housing, and targeted infrastructure and any other improvements, expenditures, or facilities that are related to any of the above projects.

Here is the ballot language:

EXPAND THE PURPOSES OF THE EXISTING TYPE B SALES AND USE TAX FOR THOSE AUTHORIZED PROJECTS AS DESCRIBED IN CHAPTERS 501 AND 505, TEXAS LOCAL GOVERNMENT CODE.

Voters will vote “For” or “Against.”