S.889 – Local sales tax may be used for economic development projects

This bill would allow locally-imposed sales and use taxes to be spent on economic development projects. As “economic development” is not clearly defined, this bill would, in effect, allow these tax dollars to be treated as a slush fund for local politicians. Current law does require a local referendum on these local sales and use taxes, and it requires the purpose for the new revenue to be included in the ballot question. However, that disclosure requirement is quite loose and does not guarantee that voters will be given all relevant information regarding the intent for these new funds at the time of voting.

Lawmakers’ role is to carefully guard the spending of taxpayer dollars, not to create loopholes for more waste. This bill is particularly concerning given the less-than-ideal disclosure requirements in current law.

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