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Published on Friday, January 11, 2013

Cities and counties recommend flexibility in local revenue

At the most recent meeting of the Joint Select Committee on Junior Taxing Districts, Municipal Corporations, and Local Government Finance, cities and counties recommended restoration of liquor revenue and flexibility in local lodging taxes and the Real Estate Excise Tax (REET).

Liquor profits and taxes have already been addressed by this committee. In December, the committee voted to support restoration of the $10 million in lost excise tax revenue and restoration of the liquor profits growth factor formula to pre-Initiative 1183 levels.

Lodging taxes are an AWC legislative priority as cities are asking to retain the current authority to fund festivals, special events, and non-profit tourism operations and capital expenditures. These expanded uses were granted in 2007 by the Legislature and are set to expire on June 30, 2013.

REET also has a temporary flexibility that will expire in 2015, and cities would like the flexibility to be made permanent. AWC explained that we are not pursuing the issue this year, as there are a couple of years left before the sunset, but we will likely pursue it in the future.

AWC will continue to explore other revenue flexibility options. We appreciate the support for liquor funding and other issues this committee may decide to provide during the 2013 legislative session.

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