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Sales Tax Increase Could Generate $78-Million For Lincoln Streets

A coalition of community leaders on Wednesday said a quarter-cent sale tax for streets is needed to keep Lincoln strong and growing.  The group is asking the City Council to place on the April 9 primary ballot a measure to raise the City sales tax one-quarter cent for six years, starting October 1, 2019.   The sales tax increase would generate about $13 million a year for a total $78 million for streets over six years.

“Because our transportation system is key to economic development, public safety and our quality of life, streets have been a priority throughout my Administration,” said Mayor Chris Beutler.  “We have increased street funding 71 percent since 2010, but we know there is much more to be done in our growing City.  Since the Citizens’ Transportation Coalition issued its recommendations a year ago, we have been working hard with all sectors of the community to reach compromises and find consensus on the street funding issue.”

The Mayor thanked City Council member Roy Christensen for working with him to bring the measure to the Council.  The proposal to place the sales tax increase on the City ballot will be introduced to Council at its January 28 meeting, and a public hearing is scheduled for February 4.  Placing a local option sales tax on the ballot requires five votes on the Council.

“We have developed a clear outline of how the funds would be used,” Christensen said.  “We’ll be able to extend the life of existing neighborhood and arterial streets through repair, rehabilitation and reconstruction.  And 25 percent of the funding will be reserved for new construction to promote private sector investment.  The money will not be used for sidewalks, trails or traffic signals, and it will not be bonded so we will not have debt and interest payments.”

The quarter-cent increase would cost the average Lincoln household about $31 annually.  To offset the impact of the sales tax on new homes and businesses, a separate resolution will be introduced to freeze impact fees at the December 31, 2018 rate for five years if voters approve the quarter-cent sales tax increase.

Bob Caldwell of Nebco was co-chair of the Transportation Coalition which recommended an increase in the sales tax over increases in property or wheel tax.  “With a sales tax increase, the money is generated from all who use our streets, not just our residents,” Caldwell said.  “Voter approval of the measure will give the City a great start on filling transportation funding gap.

An economic analysis performed by Economic & Planning Systems in March 2018 estimates that up to 37 to 40 percent of sales taxes are paid by visitors to Lincoln.

The Transportation Coalition also recommended that the City find cost savings and pursue best practices.  Miki Esposito, Director of Lincoln Transportation and Utilities, said 19 of the 24 recommendations are complete or underway, and the final six are dependent on funding.

“We are grateful for the trust Lincoln residents have placed in us to deliver a safe and reliable transportation system that meets their evolving needs,” said Esposito.  “After years of investment on high-priority arterial streets, we are ready to deliver at an even higher level in our neighborhoods. This booster shot of funding would improve 138 miles of residential streets — four times more than our current program.”

If the sales tax increase is approved, a citizen oversight committee will be appointed to provide advice and guidance on the use of the sale tax revenue.


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