Voters reject pension fund, open space taxes

PRESCOTT - Voters took a strong stand against new taxes in Tuesday's primary, Aug. 25, overwhelmingly voting down sales tax increases for police and fire pensions and open space acquisitions.

The biggest loser of the night was the 0.08-percent sales tax increase for open space acquisition and improvements. Voters defeated the measure by a 58-to-42-percent margin.

The city's bid for a 0.55-percent sales tax increase to pay off its $72 million unfunded liability in the Public Safety Personnel Retirement System (PSPRS) did not fare much better, getting support from just 44 percent of voters, while 56 percent voted in opposition.

The only tax to win the voters' support was one that will result in no net increase. By a 57-to-43-percent margin, voters approved the 0.25-percent increase in the street sales tax, which will effectively retain the current 1 percent. Since 2000, that 1 percent has been dedicated to streets and open space, with the majority going to street improvements. The new 1-percent tax - exclusively for streets - will replace the 0.75-percent tax for streets that was programmed to go into effect on Jan. 1, 2016.

Current council members and the newly elected members expressed mostly disappointment with the decisive rejection of the PSPRS tax.

"There are going to be a lot of hard decisions and a lot of disappointed citizens," Councilman Greg Lazzell said of the budget cuts that are expected in the wake of the tax defeat.

Councilman Steve Blair suggested that the voters did not understand the tax proposal. "People have the attitude that we have to live within our means, but it is going to involve some serious choices," he said. "People's way of life is going to suffer."

The city has estimated that $1.8 million would have to be cut from the budget over the next two years if the PSPRS tax measure were to fail.

Although officials have deferred the specifics of the expected cuts until after the primary, they have suggested possible cuts to police, fire, recreation services, and the library.

Former City Councilman Malcolm Barrett Jr. - a supporter of the PSPRS and street sales tax measures - maintained that the campaign against the PSPRS measure was "disingenuous," in that opponents "talked about sending a message, but the only message they're sending is 'we're not going to pay our bills."

Harry Oberg, the unofficial winner in the mayor's race Tuesday night, was the only candidate of the six to take a stand against the PSPRS tax.

While allowing that the city would have to pay the unfunded liability eventually, Oberg maintains that efforts should be made first to get the Arizona State Legislature to reform the public-safety pension system.

Tuesday night, Oberg said the city would have to "look across the board" to come up with solutions for the budget cuts. He suggested "possibly selling city assets, maybe some parcels of land" to help pay off the deficit. He said an inventory of city assets is currently underway, and he declined to comment on the specifics of the possible sale of assets.

While all of the council candidates and the current council members supported the street sales tax, only Councilwoman Jean Wilcox expressed support for the open space tax.

Tuesday night, she expressed disappointment with the results on both the PSPRS tax and the open space tax.

Wilcox maintained that those who voted against the open space tax increases "were duped by the Tea Party mentality, and don't understand that paying this tax will benefit the whole community." She has maintained that open space helps tourism efforts, and therefore brings revenue into the community.

George Sheats, a volunteer with the Over the Hill Gang trail-building group and open space proponent, also mentioned the economic benefits of open space. He also expressed disappointment with the results, pointing out that that 0.08 percent was a "conservative" proposal that would have focused on "improving what we have" rather than buying large new tracts of open land.

But Joe Pendergast, president of the Citizens Tax Committee, one of the groups opposed to the open space and PSPRS taxes, maintained Tuesday night that the results send a clear message to the council.

"I think people have had enough of taxes unless they can be justified," Pendergast said.

On the PSPRS tax, he said, "My idea was, if it did pass, the pressure is off the council." But with the defeat of the tax, he said, "The council is in a little bit of a pickle, and citizens will be up in arms, and will pressure the council to pressure the Legislature (on reform)."

Along with the sales tax results, voters overwhelmingly ratified the updated 2015 Prescott General Plan by an 80-to-20-percent margin.

Follow Cindy Barks on Twitter @Cindy_Barks. Reach her at 928-445-3333 ext. 2034, or 928-642-0951.