Kentucky communities need same tools as competitors in other states

By the Metropolitan Alliance for Growth

In the business world, successful companies keep an eye on the tools and technologies employed by their competitors.

This is a rendering of the Hampton Inn and Suites hotel project by the Malcolm Bryant Corp. set for completion later this year in Owensboro, which was able to undertake a $176 million renovation of its downtown riverfront thanks to $80 million in public bonds backed by an increase in the local insurance tax.
This is a rendering of the Hampton Inn and Suites hotel project by the Malcolm Bryant Corp. set for completion later this year in Owensboro, which was able to undertake a $176 million renovation of its downtown riverfront thanks to $80 million in public bonds backed by an increase in the local insurance tax.

In the public sector, cities and regions have competitors, too. They compete with other communities around the country, and around the globe, for new businesses and smart young entrepreneurs. These cities even compete to keep their own children and grandchildren home to grow their economies.

In light of this, Kentucky cities and counties must ask a business-oriented question: What economic development tools do we need to compete in a 21st-century economy?

In 2011, our coalition of mayors and county judges from several metropolitan areas of Kentucky joined together to strategize about how we could more effectively compete in the global economy and champion the future for Kentucky’s local governments in Frankfort. With 60 percent of Kentuckians living in metro areas – and with metro areas being the economic engine for the entire state, producing 70 percent of the state gross domestic product – a full set of tools is needed for our municipalities to win in the global economy.

It was quickly evident to our group, the Metropolitan Alliance for Growth, that Kentucky citizens do not have the basic voting right that is present in 37 other states: the right to vote on whether to invest in their communities through the funding of projects via a local-option, limited-purpose and limited-time sales tax. These capital projects – roads, parks and other infrastructure needs – improve the quality of life in our communities and are vital for our cities and counties to stay competitive nationally.

LIFT – Local Investments for Transformation – is a tool that would allow local governments to compete on a level playing field with other municipalities that allow voters to decide important community projects. The decision to invest in capital projects is decided by the voters, who know in advance how much the projects will cost, how they will be paid for (such as a penny sales tax) and when the tax will end. Think about all of the improvement projects you would like to see happen in your community but the answer seems to always be the same: “There is no money.” LIFT can solve that problem through one powerful penny – and it will also create construction jobs that put citizens to work.

For example, a city could suggest up to a 1-cent sales tax for three years to build specific projects. The citizens vote that particular proposal – up or down. They can vote “yes” – as Oklahoma City did recently to upgrade its riverfront for an Olympic Rowing Center that brings visitors, investment and new recreational opportunities to their community. Or they can vote “no” as the Atlanta region did last year on a massive public transportation proposal. The point is that the citizens get to choose through a vote.

To allow Kentuckians this same right, the first step is to amend the Kentucky Constitution – if 60 percent of the state Senate and House members vote to put the question of the local option on a statewide referendum. The earliest citizens could vote on this constitutional change would be November 2014.

If the state constitutional amendment is approved with 50 percent of the vote, cities and counties could then decide to bring a referendum to their voters to fund specific projects in their cities as soon as November 2015.

A few legislators have noted that Kentucky cities and counties already have the option to raise occupational and property taxes to pay for projects. That’s true; however, citizens do not support raising these taxes. This is all about citizen choice, and citizens support the option to raise the sales tax because they view this tax as more fair and equitable. That’s why so many localities nationwide use the local sales tax option to fund projects.

Please call your representative in Frankfort and tell them that Kentuckians deserve the right to control their own futures and have a voice in local capital investment decisions – and we need LIFT to make it happen.

Signed,

Gary W. Moore
Boone County Judge/Executive

Steve Pendery
Campbell County Judge/Executive

Al Mattingly
Daviess County Judge/Executive

Harry L. Berry
Hardin County Judge/Executive

Steve Arlinghaus
Kenton County Judge/Executive

Jim Gray
Lexington Mayor

Greg Fischer
Louisville Mayor

Mike Buchanon
Warren County Judge/Executive

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