Petition to repeal food tax verified

Mike Robuck

MONTROSE -- A petition to repeal the city's sales tax on food purchased for home consumption passed muster on Monday.

City Clerk Mary Watt verified 108 additional signatures out of 161 turned into City Hall earlier this month by residents and members of the Western Slope Libertarian Party. The first attempt to hand in the petition on March 25 was rejected because 66 of the required 418 signatures were invalid. Following the first verification process, Watt said there were duplicate signatures, along with some who weren't registered voters and others who lived outside city limits. In addition, one of the petitions had been taken apart, which Watt said isn't allowed by state statutes.

"I'm surprised they managed to get rid of 50 signatures out of the 161 this time around because we were pretty careful," said Tim Jacobs, a member of the WSLP. "It doesn't matter because we only needed 66 and now we're on track to get this tax changed. City council has the opportunity to do the right thing by passing it themselves, but it sounds like they won't, so we'll have to get it on a special ballot."

Watt said city council now has 30 days to consider the petition and if it doesn't pass the ordinance as presented, the council can set a special election within 60 days. A press release, signed by Mayor David Reed, was issued by city council on Monday, saying, "It is likely that the council will reject the ordinance and submit it to a vote of the citizens sometime this summer."

Watt has previously said a special mail-in election solely to decide the repeal of the food tax would cost around $12,000 since it doesn't fall on the same calendar year as other regularly scheduled elections.

The city has had a 3 percent tax on food purchased for home consumption since 1964. Those who oppose the sales tax have said it places an unfair burden on the poor and elderly who have fixed incomes.

"What strikes me is that there has been no moral discussion of this," Jacobs said. "From my perspective, the moral issue trumps everything. A regressive tax that is hard on people with low and fixed incomes isn't moral.

"We have a progressive income tax, which means the more you earn the higher taxes you pay. This food tax is the exact opposite because the less you earn the more goes to the taxman. It's intrinsically unfair and should be changed, in my opinion."

The city estimates a repeal on the food tax for home consumption would impact revenues by $2 million annually. Montrose is one of the few cities in the state that doesn't have a property tax and City Manager John Schneiger has said sales tax revenues account for 79 percent of the city's general fund, which it uses to fund services.

"At a time when citizens are demanding more and more from city government in terms of services, without those sales tax revenues we simply can't provide the same level of services," Reed said. "One of the beauties about sales tax funding is that Montrose is a retail trade center for this entire area of the state. Our friends from Telluride, Delta, Ouray and Ridgway are all helping to fund operations and services in the city of Montrose when they chose to shop here. It's not just the city population that has the burden of funding these services; it's a shared burden by everyone who shops here.

"If you take an elderly retired couple that is on a fixed income and we start using property taxes, what is more regressive? As their property values inflate their property tax increases, which becomes a greater percentage of their fixed income as the taxes go up. Buying food isn't a choice, but you're paying taxes on the purchases of food that's hitting you in smaller increments as opposed to a property tax, which is a huge burden when you make a lump sum payment or two payments. That's how you pay property taxes in the state of Colorado."

Jacobs said the WSLP has hired a certified public accountant to go over the city's budget, which he said should be completed by week's end.

"We're living in a time right now where the economic situation isn't terrific for everyone," Jacobs said. "People everywhere are tightening their belts, and I think it's appropriate that the city tightens its belt as well. We realize they (city officials) are infinitely more wise and knowledgeable than we are, but we might be able to help them save some money."

While the issue of putting the food sales tax on a special ballot simmers, Reed said the tax has worked well over the past 40 years for the city of Montrose.

"It seems to me that each citizen has to ask themselves if they're willing to forgo or diminish certain services that this city provides in exchange for taking away the sales tax for food purchased for home consumption," Reed said. "If the citizens of Montrose feel that services can be eliminated or curtailed by reducing the available funds then that's their choice and they'll be allowed to do that if we have this special election. It's like anything else that we do, we all have to make choices."

Contact Mike Robuck via e-mail at miker@montrosepress.com.