Indianola's $10M problem: Is a sales tax the answer?

By BY RECARDO THOMAS & BRYAN DAVIS,

A proposed referendum regarding a citywide one percent sales tax increase could generate as much as $1 million a year to be used on ailing Indianola streets and the infrastructure underneath them, but will the voters support it and will it be enough?

Indianola Mayor Steve Rosenthal said the tax will jumpstart one of the biggest infrastructure projects Indianola has seen in many years. He estimates that a $10 million investment will help to fix streets in all five wards.

When the new board and Rosenthal were voted in during the 2017 election cycle, he asked each alderman to present five streets they wanted to fix.

While $10 million will likely come short of fixing 25 streets, it could provide a lot of citizens with a smoother commute throughout the city.

Several Indianola residents recently weighed in on the matter.

T. Gardner, a Jackson Street resident who is a tenant and not a property owner, said she is for the tax because it would allow her the opportunity to be a part of the remedy.

“That would be my way to actually help get the roads and streets fixed,” she said. 

Gardner said her street is not left out when it comes to the rough riding roadways in the city.

She mentioned a huge pothole directly in front of her residence. The monies generated by the one-cent increase would be strictly allocated for streets and their underlying infrastructure. “I would vote for it as long as the streets get fixed,” Gardner added.

The Mississippi Legislature would have to approve the measure in order for it to appear on the ballot to be voted on by the citizens.

Gardner asserted that there would likely be some who are in opposition to the hike.

“We don’t want our taxes to go up in order to get the streets fixed, but if that’s going to have to happen in order to get the roads and streets fixed, I think we should go for it.”

Shelia Waldrup, a Percy Street resident and homeowner echoed a similar resolve with regard to an assurance that the funds would be used for what they are earmarked, the streets. “I think the people in the community deserve decent streets to ride on,” Waldrup said.

She, like some others, thinks imposing a gas tax where the funds would be explicitly used for the roads would be a better avenue for the needed revenue.

“But, if that (gas tax) is not a possibility,” Waldrup said she is not against a sales tax. “It’s a start,” she said.

Gardner, however, is not for a tax on gasoline.

“They can leave the gas alone, and we can pay the one cent at the stores,” she said.

Debbie Allen, a Gresham Street resident and business owner said she is very much in favor of the proposed tax increase, and like Gardner, would rather not see an additional tax on gasoline or tobacco.

She too said it would give everyone a chance to play a part in getting the streets fixed.

Effects on Real Estate

Charles and Linda Davis, who own Charles Davis Construction & Real Estate in Indianola, said they have not seen where potholes have directly caused property values to drop, but it has affected the way clients view neighborhoods with dilapidated streets.

While some streets are in more dire need of repair than others, the real estate couple raised the question of what criteria a street must meet in order to go to the front of the line.

“Only a few streets would be paved at the present time,” Charles and Linda Davis said in a statement to The E-T. “It was estimated by the Department of Revenue that the tax proposed by (Mayor Steve) Rosenthal would more than likely generate around $1 million (yearly), and according to estimates, it would take $10 million to repave the city streets (in the worst shape). Therefore, only a portion of the city streets would be paved each year. Our question is how would it be determined which streets would qualify to be redone?”

Rosenthal said the city will likely act on the recommendation of the engineers surveying the streets, but it will be a rigorous process. There is no set number of streets that would be resurfaced, because the costs of doing each street will vary.

For instance, a massive undertaking on a street like West Gresham would be more costly, due to the fact that the city would move some of the water and sewer lines out from under the street so that it does not have be torn up in case of future plumbing issues.

On the flip side, Realtors like the Davis’s have to show houses on an almost daily basis.

“As Realtors, we find it very difficult to show property to proposed buyers when the street leading to the property is in such terrible shape,” they said.

Putting their Realtor hats aside, they also raised concerns about hiking taxes on goods that are also sold in neighboring towns.

“There is a chance that residents would choose to do their shopping in neighboring towns, with a lower sales tax,” the couple said. “That would affect our community in many ways. It would hurt our local tax base and the local merchants. We always want to encourage everyone to shop locally.”

Rosenthal said the tax would not be that burdensome on the individual shopper. For example, he said that a $100 taxable purchase in Indianola would cost the customer $1.  The 1 percent of $50 would be 50 cents, $25 would be a quarter and $10 would be 10 cents.

State and Federal funds for infrastructure have become scarce in recent years. Barring any change in that trend, the solution to Indianola’s street problems will likely have to come from within.

The only question is whether the citizens are willing to take on more tax burden to make it happen.

“We don’t know what the answer is to this growing problem of our terrible street conditions, but one thing is for sure, it is going to get worse,” the Davis’s said.

Streets Would Be Prioritized Based on Need

When asked about how many streets could be repaired based on the projected revenue, City Engineer Ron Cassada said there are a great many factors to consider at this point.

Without a specific list of streets that is not something he could determine, he said.

Cassada said the condition of the water and sewer lines underneath the streets and the gutters would weigh heavily into the equation.

“It just depends,” he said.

According to Cassada he has only been in possession of the lists from the aldermen for about two weeks, and he says that he and public works director Jimmie Strong would have to ride the streets first and then prioritize them according to the worse ones.

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