Grove residents could see their water rates increase should a proposed sales tax earmarked for paying off the debt for the city’s water treatment and wastewater treatment plants fail.
The special election, set for Tuesday, Aug. 28, gives Grove residents the opportunity to extend a four-tenths of a percent sales tax for another 20 years which pays down the debt of the city’s water treatment plant and wastewater treatment plant.
Those debts exceeded $1.27 million for the 2018-19 fiscal year, said City Manager Bill Keefer.
The sales tax extension goes to the city’s capital expenses and capital-related debts, he said.
“Taxes will not be raised, this is just an extension of the current sales tax,” said Keefer.
The current sales tax collects around $751,884 per year. The water treatment plant debt expires in 2034, the current sales tax is set to expire in 2021.
If the ballot initiative fails, city leaders have said they may have to look as raising water, sewer, and gas utilities rates, Keefer said.
“That’s something we don’t want to do,” Keefer said. “We don’t know the how much the rates would increase.”
“The bright spot and we want the community to know – this is not a tax increase,” said Mayor Ed Trumbull.
Once the debts are paid down we can use the money for improvement projects, he said.
One agency supporting the tax is the Grove Area Chamber of Commerce.
"This sales tax extension is first and foremost, not a new tax," said Donnie Crain, Grove Chamber president. “It’s all about paying down the debt.
“Once that is paid, it (the tax) can be used to address other capital needs like street repairs."
Since Grove relies so heavily on its tourism base, Crain said the proposed sales tax extension also lets tourists to pay for the benefits they enjoy when vacationing on Grand Lake and Grove.
Extending the tax is common sense, Crain said.