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Proposed Sales Tax Bill Could Help Local Entities In UC

State Representative Ryan Williams told members of Putnam County’s Joint Economic and Community Development Board Thursday, a new bill could provide help with local infrastructure.

The legislator will discuss the bill next week, which would allow local governments to raise sales tax rates in order to create funding for infrastructure projects. Williams said part of the bill requires cities to specify which projects would be funded. Williams said the key to the bill is allowing local governments to go above the current 2.75 percent cap on local sales tax.

“There’s a ruling on whether or not you can bust your local option sales tax in order to do it,” Williams said. “So if you put 25 cents more and you go past two and three quarters, are we giving people statutory authority to do that by doing this bill and so there were some concerns about that.”

Most entities are already at 2.75 threshold. Williams said giving local governments the authority to raise sales taxes for specific projects could be quite beneficial to some areas in the Upper Cumberland.

“Well, as you know, Cookeville, Algood, and Baxter because we are uniquely situated on the interstate, we have a lot of people that spend money that are not from this community,” Williams said. “So if you can increase the sales tax by one-tenth of one percent, you are gonna generate revenue that pays for our roads that are mostly spent by people who are traveling through town and not by local citizens. So there are some benefits to that for local communities like ours.”

Williams said the bill could create a new avenue for local governments to match the increased cost to complete infrastructure projects.

“The cost to build a road today is five times of what it was 10 years ago,” Williams said. “And so when I was the city councilman, we talked about widening 10th Street and here we are widening 10th Street, and just a small section that we have done in the city and it was a project that we should do cost twice as much to do that small section as much as it did to do all of it when I was a city councilman 20 years ago.”

Williams said T-DOT loves the proposed bill as it would relieve the stress from the grant process.

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