Bynum, Ewing float alternative airport tax plan
BY BRIAN BARBER World Staff Writer
Sunday, May 27, 2012
5/27/12 at 7:41 AM
Read more Tulsa City Council coverage.
Read the memo from Councilors Bynum and Ewing.
Related Story: City Hall report
A third airport tax proposal is being pitched by Councilors G.T. Bynum and Blake Ewing that would not raise city sales taxes or tie up future Vision 2025 initiatives for the benefit of one industry.
The councilors are suggesting that a 0.167-cent sales tax share now being collected for the city's Fix Our Streets initiative could be targeted by Tulsa County when it expires June 30, 2014, to pursue a package.
It would generate about $90 million over five years for airport infrastructure improvements.
The tax share was previously used by the county for 4 to Fix efforts before being captured by city voters last fall to use for streets.
If further airport improvements are needed, elected officials could consider them to be part of a broad-based Vision 2025 renewal in the future, they said.
"This doesn't put all of our eggs in one basket," Ewing told the Tulsa World.
"It's reasonable to say to any of the businesses at the airport that we're going to invest and upgrade the facility to 'this' degree. We are making 'this' commitment right now. But we want to know you are committed as well.
"If you maintain your commitment, we are going to maintain ours, and we will continue to consider airport infrastructure in additional packages moving forward."
Bynum and Ewing's proposal comes in reaction to two other funding plans that are being floated to area officials.
A $329 million tax package is proposed for the Nov. 6 ballot including $254 million for airport improvements and a $75 million "deal-closing fund" to provide incentives for new businesses.
One funding option, championed by the Tulsa Metro Chamber, is to ask voters to approve a four-tenths-of-a-cent tax increase for about seven years.
It would basically amount to the Vision 2025 share approved by voters in 2003 to lure Boeing, but since Boeing never came, the tax was never collected. That would take the city's sales tax rate to nearly 9 cents.
Another funding option, offered up as an alternative by County Commissioner John Smaligo, is making the package the early renewal of the Tulsa County Vision 2025 tax, extending it years beyond its 2017 expiration date so there's no increase to the actual tax rate.
In the wake of American Airlines' bankruptcy filing last fall, chamber and area officials began meeting privately, under nondisclosure agreements, to find a way to save the thousands of maintenance jobs that could be lost.
One of the airline's needs is to enlarge the city-owned hangars to accommodate newer, larger aircraft. But other airport improvements are needed as well.
"When I first heard about this," Ewing said, "my first questions were: How do we preserve Vision 2025? And how do we not raise taxes?
"The two plans we've seen either do one or the other. Our plan would accomplish both and could be something the public gets behind.
"I don't ever want to be part of a government that capitalizes on panic with tax increases."
Bynum agreed, saying that elected leaders have a responsibility to prioritize the funds that are available.
"It's lazy to just go ask for a tax increase because you don't want to roll up your sleeves and figure out how to do the things that need to be done," he said.
The two are planning to meet with their fellow councilors, Mayor Dewey Bartlett, chamber and county leaders and area mayors starting this week.
"We're just putting this out there as a concept," he said. "It's not ready to be put on a ballot, but it's ready for serious discussion."
Bynum and Ewing did not include a "deal-closing fund" in their proposal.
"I'm opposed to that type of thing on principle," Bynum said. "We didn't want this to be about payouts to corporate entities. We wanted it to be about improvements to public infrastructure, which is what it should be."
The facilities at the airport are city-owned and date back to World War II, Bynum pointed out. They need to be properly maintained.
"We can either continue to invest in something which has kept industry coming to Tulsa and growing in Tulsa for over half a century or we can choose not to," he said. "I think it's incumbent on us to take care of an asset that has helped our economy."
It would be up to the county as to whether a fall election date for an airport tax package is pursued, they said.
Even though the 0.167-cent sales tax share doesn't expire until summer 2014, an advance funding mechanism could be used to start improvements much sooner.
But with the city planning on going for a Fix Our Streets renewal in 2013, and regional leaders considering an early renewal of Vision 2025 in 2014, voter fatigue is a possibility, Ewing said.
"I think we have to be mindful of how we roll these out," he said.
By taking out the 0.167-cent tax portion from the second Fix Our Streets package, city leaders can still use a combination of the third-penny sales tax and general obligation bonds to raise $735 million over five years to continue the streets efforts, their analysis shows.
And with Vision 2025, even though the package doesn't expire until the start of 2017, officials are looking at trying for an early renewal in 2014 to capitalize on the momentum of its finished projects. Most of the final years of the package are to pay off the bonds.
Ewing said asking voters to go to the polls three years in a row to weigh in on tax packages is asking a lot.
"It's important that when we put public packages up for a vote, there's a certain degree of confidence they are going to be well received," he said.
"I think it does a great deal of damage to a community's morale when one fails. It's important for Tulsa to maintain its swagger."
Tulsa’s total sales-tax rate:
How it’s divided
Including: 0.60 cent
Vision 2025 tax
(expires Dec. 31, 2016)
0.25 cent jail tax
City of Tulsa
Including: 2 cents
general fund tax
Fix Our Streets tax
(expires June 30, 2014)
Three proposals for the sales tax:
1. Tulsa Metro Chamber proposal: Increase the county's tax
rate 0.40 cent for about seven years.
2. County Commissioner John Smaligo proposal: Extend the
Vision 2025 tax beyond its expiration for airport improvements.
3. Councilor G.T. Bynum and Blake Ewing proposal: Give the
county back the 0.167 cent tax share when it expires to
pursue a smaller airport package. That tax share was
previously used for the 4 to Fix the County but was captured
by the city for Fix Our Streets and combined with the
third-penny sales tax.
Also, consider other airport funding in a future, more
broad-based Vision 2025 extension.
DANNY WILLIAMS / Tulsa World
Original Print Headline: 3rd airport tax plan floated
Brian Barber 918-581-8322
G.T. Bynum (left) and Blake Ewing: "I don't ever want to be part of a government that capitalizes on panic with tax increases," Ewing says. Bynum agrees: "It's lazy to just go ask for a tax increase..."