The conservative Gilbert Town Council reluctantly voted to raise taxes Tuesday night. One council member laid blame on the Arizona Legislature.
Last year, the Legislature passed a law banning municipalities from collecting rental tax.
A spokesperson for the town said a few weeks ago that the proposed tax increases for the town were not designed to make up for the loss of income from the abolition of the rental tax, but Councilmember Jim Torgeson said otherwise.
“While the Town’s operating budget has been adversely impacted by the loss of residential rental tax, the proposed tax increase is not intended to “make up for” its loss,” a town spokesperson said in an email on Sep. 24.
But at Tuesday’s council meeting, Torgeson said: “I say this with all condescension intended: The big brains at the state cut out rental tax. Most people in this room were opposing more apartments, yet the council before us approved many thousands of apartments.”
Now, the city won’t get millions in rental tax revenue for those apartments.
Gilbert approved a series of slight tax increases to the town’s sales tax and bed tax, plus a new use tax on online vendors.
The tax increases are meant to fund police and fire services, and parks and recreation.
A presentation by town staff showed that the tax increases will still keep Gilbert in the range of what other municipalities are charging.
“It pains me, and this is the most painful meeting I’ve been a part of since I’ve been up here … but I think it’s necessary,” Torgeson said. He called himself the most conservative person on the board.
Town Manager Patrick Banger noted while presenting on projects that will be funded through the tax increases that Gilbert was a town of 500 people for decades before swelling rapidly to a large community of 290,000 that is close to build-out. Therefore, he said, the town’s needs have grown.
Mayor Brigette Peterson was the only dissenting vote on the tax increases, which passed 6-1. She was the last to vote and cited inflation, high gas prices, “Bidenomics” and high water and garbage rates as a reason not to raise costs further.
She acknowledged while voting that her position was unexpected, but said she couldn’t justify all the tax raises.
Torgeson has a different theory about her vote. “Two words: political theater,” he said Wednesday.
The conservative Goldwater Institute claims the tax hikes are illegal.
Following the vote, Goldwater staff attorney Stacy Skankey said that the institute is evaluating its options “to protect Gilbert taxpayers’ rights.”
Former Councilmember Victor Petersen cautioned the council that the trajectory of the town’s planned expenditures isn’t sustainable.
“You’re going to adjust one time. You're going to feel some breathing room, and it’s going to be a few years, and you're going to be back here again because our trajectory will not map with the economics. … It’s an easy way out to do this tax increase,” he said.
Petersen is also the brother of Senate President Warren Petersen (R-Gilbert), who authored the abolition of the rental tax.
Two council members, Scott Anderson and Kathy Tilque, are leaving the council this year. In the rapidly approaching general election, Aaron Accurso and Kenny Buckland are running for those seats.
Sales tax is being raised as opposed to property tax, which council members said is the lesser of two evils.
“I despise property tax,” Toreson said. “Hopefully our Legislature is done trimming our budget for us.”
He used the example of a Gilbert resident choosing to go out and purchase a steak and pay higher sales taxes on that transaction, as opposed to a senior citizen living on a fixed income not getting a choice about having to pay a higher property tax.
Council members defended the need to fund parks and recreation in addition to police and fire.
“Think of a town you’d never want to live in,” Councilmember Chuck Bongiovanni told the audience. “And think of one reason why, whether that be traffic, crime, schools. Whatever your answer is, it comes down to quality of life.”
He said parks and recreation projects make the town a place where people want to live, and he asked residents not to think selfishly of funding projects they may not specifically feel they need.
Before voting, the town heard presentations from police, fire and parks and rec representatives. But in public comment, no one spoke enthusiastically about the tax hikes.
