FONDA — The Montgomery County Legislature passed a resolution Tuesday night asking the state legislature to reauthorize legislation that allows the county to charge an additional 1 percent sales tax. Shoppers in Montgomery County currently pay 8 percent on taxable items, but 1 point of that 8 percent is allowed by a state law that expires every three years.
“We just simply requested that the legislature extend the current sales tax. That will be followed by a home rule request, probably in June,” Montgomery County Executive Matt Ossenfort said. “We wanted to do this in a special meeting, so we’d have this done in a timely manner. We have to do this every three years for these extenders.”
The county’s 2017 $111.2 million budget has about $27 million in budgeted sales tax revenue.
“I think it would be better if there were a longer cycle between when these extenders expire. This is largely just a procedural item, but they can become politicized on the state level,” Ossenfort said. “That’s not happening with this one, but this process could be streamlined if they extended it over a longer period of time.”
County officials estimate the 1 percent sales tax being requested is worth approximately $5 million to the county’s budget.
“Keeping the sales tax at 8 percent, which it’s been at for more than a decade, is imperative. It will go through, this is just a procedural thing, but if it didn’t happen for some reason that would be an approximately $4 to $5 million hole in the budget, which, combined with the property tax cap, would almost be a crisis for the county,” Ossenfort said. “I think the emphasis for the general public though is that this is not an increase. This will just keep things at the same rate that they’ve been for more than 10 years.”
Ossenfort said Montgomery County also benefits greatly from sales tax spent by truck drivers passing through the county purchasing fuel and other goods.
“One of the biggest components of our total sales tax is the sales tax from motor fuel. When we saw that big drop in gas prices, that accounted almost entirely for a drop we had in sales tax, which was well over $1 million. The sales tax helps us offset the property tax and is a vital component of our budget,” he said.