City sales tax is right on target

HARTINGTON — The city of Hartington has brought in just over $88,000 in sales taxes in the six months since the city began collecting the new tax.
This figure is right on target with  estimates provided by the State Dept. of Revenue in January, 2007 prior to the election.
At an informational meeting here in January, 2007, Revenue Dept. personnell estiamted the city could generate between $150,000 and $200,000 annually.

The registered voters in Hartington gave their approval for a city sales tax in a special election in May of 2007 – a one percent city sales tax went into affect last fall.
Hartington businesses started collecting sales tax in October.
Each business remits the sales tax to the Nebraska Department of Revenue. Once a month the total amount is then electronically deposited in an account for the city of Hartington by the State Treasurer’s office.
The amount collected from motor vehicle sales tax goes to the street department. Five percent of the remaining funds are used for debt retirement. Thirty-five percent of the funds are used for economic development and sixty percent is earmarked for city infrastructure.
An amount of $88,014 was collected in sales tax from October of 2007 through March of 2008.
The tax amount from motor vehicle sales for that period was close to $11,300.
“The sales tax from motor vehicles is used for the repair of city streets. It cannot be used for infra-structure. It cannot be used for new paving,” said Mayor Bill Yates.

In the first six months of collection, $3,836 went toward the city debt retirement and $26,853 has been accrued for economic development.
“The funds for debt retirement have to be used to reduce the debt from bonds – such as the swimming pool and the Community Complex,” Yates said.
The larger amount of $46,035, which is to be used for infra-structure, has been kept in a savings account.
“The money has to be used for infra-structure,” said Yates. “It can be used on an existing city building or for the replacement of existing paved or asphalt streets.”
A new paving project cannot be considered as part of the infra-structure, said Yates.

“The cost of new paving on a street goes to the adjacent land owners,” Yates said.
The funds received for infra-structure are currently being held in a savings account and will be used for large city projects, which have a high price tag.