Oro Valley Town Council
Randy Metcalf/The Explorer

While the issue of taxes was not on the Oro Valley Town Council’s regular agenda last week, several residents used the public comment portion of the meeting to express how they feel about proposed tax increases for the 2011-2012 fiscal year.

In accordance with state law, the Town of Oro Valley has published its intent to increase both utility and privilege taxes. The tax increases have neither been approved nor discussed by the town council, and are just proposals at this time.

Greg Caton, assistant town manager, said the utility tax issue will be discussed May 4, when the council is expected to vote on the measure that calls for a 2-percent increase.

Oro Valley residents currently pay a 2-percent tax, and the increase would require them to pay 4 percent. The budget presented to the council by Town Manager Jerene Watson shows the 4-percent increase will bring $1.3 million in added revenues.

Town officials estimate it will cost the average resident an added $6 per month.

The council may not approve the increase at all or it could drop the increase to 3 percent instead of 4.

A .25 percent sales tax increase also is being considered. Oro Valley residents currently pay a 9.1-percent rate, with 2 percent of that set by the town and the remainder set by the state. With the proposed increase, the Oro Valley sales tax rate would be 9.35 percent, starting July 1, when the new fiscal year begins. Council is expected to discuss the issue more before the budget is approved in June.

During the April 20 meeting, residents spoke against any increase.

Single mom, Carol Ruehl, said she couldn’t believe the council would even consider increasing taxes given the tough economic times.

“I am a single mom, living on one salary, trying to raise and educate two children,” she said. “I don’t shop in Oro Valley unless I have to. I would rather go to the Wal-Mart on La Cholla at 5:30 in the morning where the sales tax is 7.1 percent, instead of paying 9.1 percent up here. You can’t consider raising taxes on us. We can’t go to our bosses and ask for a raise. Our utility tax is already high enough.”

Retired resident Richard Tracy said he doesn’t like the idea of paying more taxes, but said given the tough economic times it may not be unfair for the council to propose a reasonable increase.

Resident Scott Leska said he’s opposed to any kind of increase.

“Personally, maybe I can afford the extra $8 or $10 a month, but we want growth,” he said. “With these taxes you are going to drive residents out. They will go to the county or Marana.”

Leska said it comes down to economic sense, and in these tough economic times the government must be responsible and realize it’s not feasible to increase taxes.

Resident George Gray said, “I am against any kind of tax increase. Bureaucrats love to spend other people’s money. I am just an old white guy struggling to get by in the world, but I like it here in Oro Valley. How many things have been done to increase efficiency? Have you even considered decreasing taxes?”

After multiple residents spoke against any kind of tax or fee increase, Mayor Satish Hiremath addressed the audience.

“Nothing ever becomes good from cutting. It is just going to take something good and make it mediocre,” he said. “We need to provide and create opportunities for citizens to become successful. How can focusing on expenses alone make our town attractive to get residents to move here, or businesses to relocate here? The point is not to cut to the point where we become mediocre.”

Even with the proposed increases, Hiremath said the budget is already being cut drastically. The budget proposed by the city manager goes from $116.2 million in the current fiscal year, to $94 million in the upcoming fiscal year.

Hiremath said he will not let the council be scared of discussing the revenue side of the budget, and just saying no more taxes is not a possibility.

Councilmen Steve Solomon and Joe Hornat agreed with Hiremath.

“Spending is not spiraling out of control,” Solomon said. “We have cut spending by over 21 percent. None of us want to raise taxes.”

Solomon compared the tax increase to the cost of going to Starbucks, saying it’s worth having to keep up public safety and parks and recreation.

Hornat said the state budget crisis has not helped any town. Oro Valley will lose $360,000 in state-shared revenues.

“We’ve been screwed by the state just like you,” he said. “Had we made adjustments earlier we may be in better shape. Taxes aren’t bad because they are taxes. Taxes are bad because they are spent the wrong way, and we aren’t going to do that.”

During an April 13 public event, Councilman William Garner said he opposes all tax increases.

While the utility tax issue will be discussed during the May 4 regular meeting, a study session to discuss the entire budget will be held May 11, and a public hearing on the budget will be held on May 18.


Upcoming meetings:

May 4: Discussion on utility tax proposal

May 11: Council work session on proposed 2011-12 budget

May 18: Budget public hearing

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