Two members of the DuPont City Council have proposed increasing the city’s business and occupation tax to the maximum allowable rate to raise money for landscaping and park maintenance.
The proposal would increase the tax from its current one-tenth of one percent to two-tenths of one percent of gross receipts in the south Pierce County city. Based on DuPont’s 2013 gross receipts from its B&O tax collection, the increase would have generated an addition of almost $170,000 in 2013. That figure includes factoring in a deduction for businesses that also pay a square footage tax.
Council members Roger Westman and Shawna Gasak proposed the increase at a meeting last week.
“The business community has expressed a lot of concern with the maintenance of the parks and the greenways and the roads leading up to the businesses,” Gasak said. “The idea was to put the money where the businesses would see the biggest improvement.”
The city assesses B&O taxes based on the gross revenue or usable square footage of a business. The money collected is used to help pay for police, fire, park maintenance, economic development and general government operations.
DuPont is one of 40 cities in the state to impose the tax.
Councilman Mike Courts questioned using the additional money for landscaping and park maintenance after the council recently voted against allowing volunteers to maintain two parks.
In February the council voted 4-3 against allowing the Northwest Landing Residential Owners Association and Commercial Owners Association to pay for the landscaping and maintenance at Ross Plaza and Clocktower Park. Westman and Gasak voted with the majority on the issue.
Now the two council members are proposing a tax increase on businesses to pay for the same thing the commercial group had volunteered to do for free, Coats said.
“The message we send is, ‘We the residents of DuPont choose to maintain our taxes at a low rate but we want to increase (business) taxes so we can maintain our quality of life,’” Courts said at the Tuesday meeting.
Council members Kathleen Trotter and Penny Coffey questioned the impact on some already cash-strapped small-business owners. Councilman Michael Gorski shared those concerns, but said that shouldn’t stop the council from having the discussion.
“For a long time we have missed opportunities for maximizing our taxes,” he said at the Tuesday meeting. “I see there is an opportunity here, but I’m not sure where.”
Jacquelyn Farrell, owner of Farrelli’s Wood Fired Pizza and McNamara’s Pub and Eatery in DuPont, said the discussion comes at a bad time.
Farrell began offering health insurance to employees in January, which added $100,000 to employee costs. Minimum wage increases and an 8 percent increase in food costs also hit the bottom line this year, she said.
Doubling the B&O tax to cover city landscaping – instead of a critical service such as the fire department – doesn’t sit well with Farrell.
“Every business owner that I’ve spoken to doesn’t think it’s a reasonable tax to impose at this time,” she said.
But at least one business owner said she would support it.
DuPont General Store owner Sandy Ikemeier said that being part of a community means paying for services.
“I’m 100 percent for it; it’s not that big of a deal,” she said Friday. “For what we get, it’s so well worth it.”
Gasak was surprised by the criticism the proposal has generated.
“We’re the only two council members that have brought forward any revenue ideas,” she said Friday.
A date has not been set for the council to vote on the measure.Brynn Grimley: 253-597-8567 brynn.grimley@ thenewstribune.com