Daily Newspaper and for Reeves County Trans Pecos, Big Bend of West Texas
Friday, November 7, 1997
By Mac McKinnon
Sales tax issue has surprising results
The election this past week in Midland and Odessa has stirred up a lot
As you may know, the sales tax issue in Midland was voted down. That
measure would have increased the sales tax in Midland and reduced
property taxes with some of the increased sales tax to go toward
recruiting new industry and business for Midland.
In Odessa, the issue was to take sales tax away from the hospital and
give it to a fund to help attract industry. Both cities wanted to
compete with other cities that are offering lump sums of money to
industries to relocate to their town.
Amarillo has been doing this for a number of years and has been
successful, at least to this point. Because of the size of Amarillo, the
sales tax fund is very large so they can afford to offer the big bucks
to attract new industry.
Most cities in addition to offering money to help industry relocate, can
also offer some form of local tax abatement - reducing or eliminating
taxes for a period of years.
Pecos and Reeves County is working on an abatement program - or as some
people want to say - an investment program.
There are many arguments pro and con on this issue. I wasn't sure of my
feelings on this issue for a number of years until I was working on
getting an industry located in Colorado City back in the 70s and then we
got beat out by Alabama because they could sell low interest revenue
bonds, a forerunner of cash incentives and tax abatement. Texas didn't
allow those kinds of bonds at the time.
It's a competitive world out there and I'm not sure if I like trying to
buy "loyalty." What's to keep business and industry in your town for a
long period of time if they accept your offer that is only good for a
period of years?
It's all a gamble and you hope they will like doing business in your
town and stay there for the long haul and that's where you get a return
on your "investment."
I prefer to have homegrown industries where the people involved have
roots. But that is not always possible so you have to go out and try to
attract new people. There are times that people from the outside
appreciate what you have more than people who have lived in a town
forever. Such is the case with Pecos and most places.
I'm not sure why the issue was defeated in Midland as I thought it had a
better chance of passage than did the issue in Odessa. It's just
difficult to predict how people will vote on certain issues.
There has been discussion in recent years of just having a sales tax and
doing away with property taxes in the state. On the national level,
there have been proposals to have a national sales tax instead of an
income tax. Those issues probably won't fly with voters, at least not
any time soon.
It's all part of our changing world.
Editor's Note: Mac McKinnon is the Editor and Publisher of the Pecos
Enterprise whose column appears each Friday. He can be e-mailed at:
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Mac McKinnon, Publisher
Peggy McCracken, Webmaster
Division of Buckner News Alliance, Inc.
324 S. Cedar St., Pecos, TX 79772
Phone 915-445-5475, FAX 915-445-4321
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Copyright 1997 by Pecos Enterprise