Struggling to close a $14 million budget deficit as of June, the Gilbert Town Council passed three measures to increase taxes. But after seeing 2,400 citizen signatures and hearing dozens of speakers protest the tax hike at a council meeting, the council unanimously repealed the tax hikes.
Gilbert council listened during tax debate
The largest tax measure increased the town's sales tax rate from 1.5 to 1.75 percent, bringing in an extra $7.3 million dollars a year. Another measure set a new 1 percent use tax on items purchased outside the town, on everything from cars to toys. A third measure taxed small-scale landlords on their rental properties.
Ultimately, all the taxes would have been paid by Gilbert residents and consumers. Of course, these increases come at a time when families are already slashing their own budgets and pinching every penny. It's no surprise taxpayers objected.
One group of residents, calling themselves the TEA Party (for "Taxed Enough Already"), filed a petition for referendum to let Gilbert voters decide whether to raise their taxes. Under the Arizona Constitution, voters have a right to petition for a referendum on any general law their elected officials enact. The right extends to both the state and city level, though there are some exceptions at the state level.
For a town petition, a citizen must get the signatures of 10 percent of the voters; in Gilbert that was 1,750 signatures. The TEA Party exceeded the minimum by 650, filing about 2,400 signatures for each of the three tax measures. After an official spot check to make sure the signatures were valid, the next step would have been to put the taxes to a public vote.
Gilbert's attorney and town clerk threatened that the tax measures would not legally be referred to the ballot. At the next public hearing, before the town officially decided whether to accept or reject the petitions, the legal arm of the Phoenix-based Goldwater Institute explained to the council that the measures were legally referable according to the Arizona Constitution. The institute also made clear it was prepared to file a lawsuit if the town refused to let its citizens vote.
Fortunately, there was no need for a lawsuit. Council members listened to the presentation by the Goldwater Institute and an hour of testimony from residents who opposed the taxes, and each member voted to rescind them before they even went into effect.
At the same public meeting, Gilbert officials also voted to cut a $5,000 fireworks show from the town's annual "So Long to Summer Fest" without a single complaint from citizens. It seems that many Gilbert taxpayers would much rather spare unnecessary government spending than dig into their pockets to pay for it.
In contrast to the headline-making health care town hall meetings, despite high-level emotions and a spectrum of viewpoints, both the Gilbert council members and the public were exceedingly respectful to each participant who voiced an opinion about the financial state of their community. Ultimately, the majority taxpayers prevailed. Even councilwoman Linda Abbott, who proposed the tax increase, voted to rescind it.
Much work lies ahead for Gilbert. Without the new taxes, council members will have to find other ways close the anticipated $10 million budget gap for the upcoming year. In the meantime, the town's 1.5 percent tax rate will remain the lowest of all Arizona cities and towns.