Prattville Mayor proposes extension of sales tax increase - WSFA.com Montgomery Alabama news.

Prattville Mayor proposes extension of sales tax increase

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PRATTVILLE, AL (WSFA) -

Prattville Mayor Bill Gillespie said he will propose to keep the city's sales tax rate at 9.5% through the next fiscal year.  He made the recommendation during a City Council work session on the Fiscal Year 2012 budget.  Gillespie said the extra revenue is needed as the city continues to deal with tight finances.

Earlier, the city council voted to increase the tax by a percentage point earlier this year from 8.5% to 9.5%.  Gillespie said contrary to some initial fears, the increase has helped stabilize the city's revenue base.

"We had some people say it would actually lower our revenue source, but the citizens of Prattville have understood that the need was there, and accepted it graciously," Gillespie said.

The tax increase is currently scheduled to expire in April of 2012.  The mayor will propose keeping the tax rate at 9.5% at least through the 2012 fiscal year, and then reducing it to 9%.  After that point, the hope is the increase could be eliminated, and the rate will go back to 8.5%.

"Once we get some of this behind us, the sales tax will come off," he said.   "We'll go back where we were and we can move forward."

The mayor says other spending cuts, along with added revenue from the sales tax increase, could help avoid layoffs in the city's workforce.  But at least one council member says it doesn't go far enough.  Ray Boles said the council should vote for the tax extension, but budget as if they didn't.  The effect of that would force the city to layoff employees.

We wouldn't have to, but we're not moving forward to fix the situation," Boles said.  "We're staying in there paddling trying to keep our head above water.  I want to get back in the boat."

The mayor will present a formal budget proposal next week, but it is up to the city council to approve it or make changes. 

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