Commish's Corner

There has been a lot of talk on the street lately about a proposed public safety sales tax in Lincoln County. I would like to take this opportunity to share with you some of our struggles, clear up a few misconceptions and then explain the concept to the public.

First of all, as you know, the county had a very difficult time balancing the 2016 budget. This condition has been escalating for several years and will continue to compound itself into the future. I feel that it is extremely important to share with you, the taxpayers, the struggles that your local governments are facing. I will reiterate some points from my article written in January so please bear with me if they sound familiar. They are extremely important and worth repeating.

First off, the public should know that the new maintenance facility recently built by the county is not the reason for any of these budgetary problems. The county road fund is separate and, although it does receive property tax and is affected by the one-percent limitation, it is funded mostly by fuel tax revenue that is generated throughout the state and is not as adversely impacted as the general fund. The new facility was long overdue and now provides our crews with a safe, efficient building in which to repair the equipment necessary to maintain our 2,000 miles of county roads.

There are several contributing factors to recent budget problems, but the underlying cause of struggling local governments is Tim Eyman’s Initiative 747 that limits property tax growth to one percent above the amount collected the previous year. As expenses grow at 3-5% per year, it creates a “structural gap” in the general funds of all taxing entities. This results in a condition where expenses grow faster than revenues, and as time goes on, the “gap” becomes wider. In 2016 alone, I-747 resulted in a $580,000 loss to the general fund in Lincoln County.

As each year passes, the negative effects of this shortfall become more pronounced. Frequent adjustments must be made in the way we conduct business in order to balance budgets. When large cuts are made, historically they have carried the county through several years. Big cuts typically equate to a bigger ending cash balance during that budget cycle, which can then be used to maintain the level of service – for a finite period of time. You can only rely on excess cash for so long. Corrections (cuts) are made, cash balance goes up, and then, back down the slippery slope we go.

As this trend continues with no end in sight, the time between large cuts becomes less. The effect of those cuts inflating the cash balance becomes less. And the ability to provide an adequate level of service becomes less. In the past, Lincoln County has done an outstanding job of doing more with less. Recently, we have been struggling to just maintain adequate service with little or no impact to the general public. We have done virtually everything possible to eliminate waste, improve efficiencies and do more with less. In fact, the efficiencies have been so great since the implementation of I-747 that the public has virtually felt no impact up until this point.

We are at the point now that the public is beginning to feel the effect, and that feeling will intensify over time. Make no mistake, the one-percent limitation on property tax is not sustainable into the future for small governments that cannot off-set that loss with increases in other revenues such as sales tax or new construction.

Every office in the courthouse is now at or below minimum staffing levels and is open to the public one less hour every day. The Sheriff’s Office is short three deputies over the last two years, and there is no money available to replace them. With drug-use related property crimes occurring all too often, it is imperative that sufficient deputies are available to respond when the need arises.

Now, at this point, it may sound like I am complaining! To reference a saying that I frequently hear in the courthouse, “I am not complaining, I’m just explaining!” I feel that it is my duty to keep the public informed on the challenges we face here in Lincoln County.

Before I explain the public safety sales tax concept, let me just say that no one is trying, as they say, “to cram this down our throats!” We have a very serious problem that the public needs to be aware of, and this is a way to help, but only if you, the voters, agree. If not, we will continue to make do with what we have. Just like everyone else! Government’s only power comes from the consent of the people – and governments are established to protect and maintain individual rights. And now you get to decide at what level those rights will be protected and maintained.

To preface, the commissioners decided that in order to move forward with a vote on this proposal we would need concurrence and support from all eight city/town councils which would also receive a portion of the revenue. After making presentations to them and outlining the facts, all eight councils agreed to support the proposition by adopting resolutions. Therefore, the measure will be on the general election ballot in November.

Now here is the idea. The law allows, by vote of the people, for collection of up to 3/10 of one percent sales tax for public safety. This sales tax would be collected countywide and would be split between the towns and the county. The county would receive 60% of the revenue with the balance split between the towns, based on population. As an example, the county would receive approximately $215,000 per year while the towns would receive anywhere from $44,000 (Davenport) to $6,000 (Creston). Retail sales of motor vehicles are exempt from the tax.

If the proposition is approved, Lincoln County will dedicate 100 percent of the revenue toward public safety, such as replacing lost revenue for funding a Deputy Sheriff. To remain accountable and to ensure that this revenue is spent appropriately, Lincoln County will establish a dedicated fund in which to receive the money. Inside of that fund, there will be created a reserve account where a modest amount of the proceeds will be kept in order to help offset any unforeseeable public safety expenses not budgeted for.

So, how much is this going to cost? The current sales tax rate is 7.7 percent. If the new tax rate is approved, it would rise to 8.0 percent, or an additional 15 cents on a $50 purchase or $3 if you spend $1,000. Keep in mind that if you are purchasing items for use in the general course of business, typically the sales tax you pay is deducted as an expense. Also, last December, Congress passed the Consolidated Appropriations Act which allows Washington residents who itemize their deductions, to also deduct sales tax from their income tax, even if they are not a business.

For comparison, I have included the sales tax rates from surrounding communities:

Airway Heights 8.9, Spokane 8.7, Ephrata 8.0, Omak 8.1, East Wenatchee 8.2, Grand Coulee 7.9, Lincoln County 7.7.

This revenue will be used only for public safety. As Sheriff Wade Magers stated in his report earlier in the year, there will be significant shortfalls in service. The lack of deputies will have an effect on our ability to provide adequate public safety. This additional sales tax revenue could replace at least one deputy in the county and help offset the law enforcement costs in our towns. But the choice is ultimately up to you, the voters. Nobody likes new taxes, but the reality is that most small governments just can’t afford to keep providing the same level of service with revenues that do not keep pace with expenses. My job as an elected official is to make sure that the public is aware and educated about these type of situations, provide possible solutions and make sure that you have a say in how your tax money is spent.

Please take a few minutes to check out an informational video I made that elaborates on this proposal. You can find a link to the video on my Facebook page “Commissioner Rob Coffman” or on YouTube by searching for “Rob Coffman Public Safety.” If you do not have a computer available, I would be happy to arrange an alternate way for you to view the video. Please feel free to email, call or just stop by anytime. Contact information: 509-641-0099, 509-725-3031 or rcoffman@co.lincoln.wa.us.