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m <br />:.\v: <br />>:r <br />W'"'SvV-'IS'Ci <br />fi. <br />m.W-l. <br />’ k* . ^ ■ <br />Pi;, <br />>■■ <br />if <br />■r: <br />ilI <br />.1 <br />.. <br />ORONO CITY COUNCIL MEETING HELD JUNE 10, 1991 <br />(#12)0PTI0NAL SALES TAX CONTINUED <br />cities throughout the County have until August 1, 1991, to <br />reverse that action. He said. "If the communities representing a <br />majority of the population within the County adopt resolutions <br />that go against whatever action is taken by the County Board, <br />then the communities will prevail effective August j. , 1991, and <br />would be removed effective January i, 1992. As it stands <br />now, the sales tax will be raised 1/2 percent on July 1, 1991. <br />If the County and/or cities support resolutions opposing the 1/2 <br />p0]^C0nt sales tax, the tax would be removed December 31, 1991. <br />If such is the case, the various cities and County will lose <br />whatever aid there is." <br />Butler stated that in reality the sales tax is not optional. <br />Goetten agreed and expressed disappointment in the State <br />Legislature for passing this issue to the municipal level as <br />opposed to handling it themselves on the State level. <br />Callahan asked Bernhardson what the City of Orono is <br />currently receiving for State Aid. <br />Bernhardson replied, "Right now, the City of Orono does not <br />any Local Aid or Homestead Credit in 1991. Part of this <br />package is a buy-down in the classification rate from 3% to 2»i% <br />in 1992, and 2% in 1993. In 1992, the City would receive an <br />estimated $91,000 which would be used to purchase that buy-down. <br />that money is not distributed in Hennepin County, instead of <br />receiving that $91,000 to buy-down 1/2 a percent, that amount <br />would be spread over the rest of the Orono City tax ba«e. This <br />means that anyone with taxes under 3% would increase. n 1993, <br />under what is now the vetoed distribution formula, thu ' • w <br />supposed to receive approximately $240,000 which is to buy-uown <br />from 2H% to 2%. It will make a signif i , .*-.t difference if that <br />distribution formula is used." <br />Jabbour stated that it seems the State Legislature has no <br />concern about the number of Minnesotans who are spending their <br />money outside the State to avoid sales tax. There is a major <br />loophole in the system. <br />Butler asked Bernhardson for his recommendation regarding <br />Council’s action relative to the draft resolution. <br />Bernhardson replied, "The Council may chose to take no stand <br />at this point. I base that statement on information I have <br />received indicating that the communities representing a majority <br />of the County population have already adopted resolutions <br />supporting the implementation of the 1/2 percent sales tax. <br />Based on that, the County will more than likely approve the local <br />option sales tax." <br />- 6 -