Charlotte Eyes Income Tax to Fund Road Repairs

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Charlotte has a common problem: crumbling roads and no money to fix them.

And like many cities, falling property tax revenue is choking off a major revenue stream which means the city is now looking at imposing a new income tax.

A Department of Public Works survey showed 63 percent of Charlotte's roads were in "poor condition."

Charlotte Mayor Dee Smith said it's a problem that's only getting worse.

"We're looking at a minimum of a half a million a year, not only to repair but to maintain our roads," Smith said.

Smith said the council was faced with three options: levy a millage, impose a new tax or let the roads get worse. He said council favored the tax option.

"They thought it was the fairest way to do this," he said. "Tax the people who use the road, not just the people who live inside the city."

The city estimates such a tax would bring in about $1.5 million in extra revenue. Residents would be taxed at one percent while non-residents who worked in the city would be taxed at 0.5 percent.

But going that route could pose some issues, according to Charlotte City Manager Gregg Guetschow.

"No council can guarantee that the income tax money would be used for the purpose of which it's being levied," Guetschow said. "That's a real problem with it and we don't have the ability to easily correct that."

One solution though could be to ask for a millage instead, but that option means money would only be coming from residents.

"All us are scrambling trying to figure out how we deal with the new fiscal realities that we're facing which is property tax doesn't generate the amount that it has in the past and we've all suffered cutbacks at the state level," Guetschow said.

Either route the city council chooses to would have to be placed on the ballot for voters to ultimately decide.

A public hearing is scheduled for Tuesday at 7 pm at City Hall. Both Smith and Guetschow said they hope to hear more from the public on how they feel about the proposed new taxes.

A decision on how to proceed could be made as early as Tuesday night after the public hearing.

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