Newport City Council held a Public Hearing and afterward approved by a 4-2 vote the Adoption of Ordinance No. 2185, an Ordinance Implementing a Five Percent Food and Beverage Tax and Referring the Ordinance to the Voters at the General Election. The council also unanimously approved after a public hearing adoption of Ordinance No. 2186 Increasing the Tax on Motor Vehicle Fuel Dealers to Five Cents per Gallon. Both ordinances will be referred to voters at the General Election to be held on November 2, 2021.
Public comment was centered on encouraging the council to vote no as it would have an affect on those who are here on a fixed income that already pay high taxes. Others suggested a 1% tax on food at the grocery stores instead. Citizens encouraged the council to look at following through with fines for vacation rental violations. Many felt that the proposed taxes would cause financial hardship to local citizens. The city was called out for spending $31,000 on a consultant to go over the financials and come to the conclusion of the increased taxes. Restaurant owners pointed out that they are hurting after coming off of the Covid Pandemic and increases in minimum wages. They felt the increased taxes, though paid by customers, would mean less people choosing to eat out, which would affect their business.
After the vote, Newport Mayor Dean Sawyer thanked those who attended the meeting and those who sent in public comment. He added that anyone interested in making change is encouraged to volunteer for one of the cities many committees. He added that the city runs on volunteers and those who are interested are welcome to be part of the budget or finance committee. "It's about what kind of quality of life we want in our city. Ultimately it will be up to the voters of the city of Newport to decide if they approve the tax or not."
The city manager's report stated that work group planning determined how to properly maintain the 48 public structures and facilities supported by the General Fund, such as the Library, Performing Arts Center, Visual Arts Center, Recreation Center, 60+ Center, numerous parks and trails, fire stations, City Hall, the airport, public restrooms, and other key facilities, and how to meet public safety needs in a community highly impacted by tourism. These are many of the amenities that make Newport such a wonderful community for those who live, work, and play here. Many of the city’s facilities currently require significant investments to lengthen their lifespans and reinforce their ability to serve residents and visitors for many years to come.
These taxes are the preferred alternative by the City Council because they equitably distribute the burden between the city’s 10,000 residents and the nearly 20,000 visitors who utilize city services and facilities. The gas tax is expected to generate $392,000 in revenue annually and will be used for maintenance and repairs to streets within the city. The city estimates it needs to invest $2 million per year in the street system to keep up with wear and tear. The food and beverage tax is expected to generate $2,543,000 annually, the prepared food assessment would be paid by the consumers of prepared foods as separate line items on their bills. The vendor would collect the tax and turn those funds over to the city on a quarterly basis.
· The prepared food tax would fund the following positions and projects:
o Three police officers, one parking enforcement officer, three firefighters/EMTs, one bilingual librarian and a part-time library staff position;
o Maintenance and upgrades to 48 city-owned facilities (including the Visual Arts Center, Performing Arts Center, Recreation Center and 60+ Center) and parks;
o One-time business grants to assist prepared food vendors in collecting the new tax; and
o Replacing and purchasing equipment for city operations.
The prepared food tax is a five-year levy with an option to renew. By statute, the City Council could choose to pass these taxes with a motion and vote. Instead, the Council opted to put these items before the voters.