Councils explore local option tax

PONDERAY — Two Bonner County governing bodies teamed up once again to flesh out the bones of the conceptual local option tax Monday evening.

While the measure is still in an exploratory phase and won’t be official until each group individually adopts a resolution, the Sandpoint and Ponderay councils have further defined the nature of the local option tax they’ll be developing. In the interest of maximizing fairness while limiting the increased tax burden, officials settled on a 0.5-percent sales tax without any product exceptions set for a duration of five years. If the councils approve their resolutions, Sandpoint and Ponderay residents will decide its fate in the November election.

“If we’re looking to keep things simple, this seems like a good place to start,” Councilwoman Jamie Brunner said.

In crafting the vision for the local option tax, council members aimed to craft a measure that was easy for businesses to implement and cities to manage. By establishing the tax as an across-the-board concept, businesses that deal in several product types will have a simpler time putting it into effect.

According to data presented by city planners Jeremy Grimm and Erik Brubaker at the initial meeting last week, a sales tax at that rate should generate an estimated $612,500 between the two cities.

Ponderay will likely see a larger percentage of that figure thanks to the high quantity of sales from big box stores, but the tax will nevertheless add a significant revenue stream for both cities. The income increase would be especially significant for Ponderay’s much smaller budget.

For a home pulling in the county median income of $39,233, the tax represents an increased yearly financial burden of about $35 assuming they do all their shopping in Sandpoint or Ponderay.

This revenue can be used to support local initiatives like the development of Field of Dreams, the Memorial Field restoration, improved infrastructure or the Pend d’Oreille Bay Trail — all popular but secondary projects during tough budgeting years.

However, the beneficiaries of the local option tax, if it is sent to the ballot, are not yet set in stone. In fact, that’s the next step for both councils. In the coming weeks, Sandpoint and Ponderay councils will draw up a list of projects they wish to support with the revenue, giving voters cause to weigh its merits on Election Day.

Some aspects of the local option tax still need to be developed. For example, the councils have taken this on as a joint measure in the interest of preserving an even playing field, and they will need a contingency plan if only one city passes the measure. The ballot language will also need to be written to meet the county’s Sept. 7 deadline.