To tax or not to tax. That's the decision facing the Russellville city leaders. Right now, the city council is deadlocked. The mayor and two councilmen are in favor of a one cent sales tax increase, but three other councilmen are against it.
According to Superintendent Don Cox, proration, declining reserves, and a lack of local funding are the driving factors behind the financial crisis facing Russellville City Schools.
"We're 90th out of 131 school systems with local funding," says Cox.
The low ranking is based on the amount spent per student. In 2008, Cox says that amount was $588, which is down from $1,390 in 2006 and $1,496 in 2004. The system has also had to eliminate every teacher paid through local funds.
"If they do pass an additional one cent sales tax, what we're asking for is 38-percent of that," explains Cox.
Currently, the school system gets 38.3 percent of the three cents the city receives from the 8% sales tax rate, which is equivalent to $1.4 million from the city. The $1.4 million represents six percent of the school system's total budget for the year. Cox says a one cent sales tax increase would add $400,000 to that amount.
Councilman Jeff Masterson, who's in favor of the tax hike, released this statement:
"To balance our budget we have two options, raise revenue or make cuts. No one, including myself, likes raising taxes, but the cost of running the city has gone up. If it hadn't, our sales tax would be at 7 percent instead of 8 percent. Keep in mind, most everyone around us is already at 9 percent. My goal is to fund the school system the 38.3 percent of the sales tax, like the city school system was set up in its inception, and maintain city services with everyone still employed. I've drawn unemployment at Christmas time before, and its not a good feeling. Therefore, with the average basket cost at Walmart at around $40, that's an additional 40 cents I'm willing to pay each time to educate our students and keep everyone employed."
Not everyone is in favor of raising taxes. The proof is clear in the dozens of signs that say, "No New Tax", that are posted all over the city.
Russellville resident Milford Brown put up the signs.
"To me, that's the last step and not the first step in trying to solve the problem," explains Brown.
Randy Bray owns Bama Signs on Lawrence Street in Russellville. Bray says he's already competing with the internet and higher sales tax would hurt his business even more. Bray feels the city needs to make cutbacks.
"They need to trim the fat," says Bray. "Maybe cut out travel expenses or cut out a few lights. Every little thing is going to help."
Brown says taxing an already taxed group of people isn't right.
"I just can't see another additional tax to put another burden on the people at this time," says Brown.
The proposed one cent sales tax increase is expected to bring an additional $1.2 million of revenue for the city. Until this issue is resolved, the Russellville City Council can't approve a budget. Council members plan to discuss the issue again at a work session on Monday.
According to Superintendent Don Cox, proration, declining reserves, and a lack of local funding are the driving factors behind the financial crisis facing Russellville City Schools.
"We're 90th out of 131 school systems with local funding," says Cox.
The low ranking is based on the amount spent per student. In 2008, Cox says that amount was $588, which is down from $1,390 in 2006 and $1,496 in 2004. The system has also had to eliminate every teacher paid through local funds.
"If they do pass an additional one cent sales tax, what we're asking for is 38-percent of that," explains Cox.
Currently, the school system gets 38.3 percent of the three cents the city receives from the 8% sales tax rate, which is equivalent to $1.4 million from the city. The $1.4 million represents six percent of the school system's total budget for the year. Cox says a one cent sales tax increase would add $400,000 to that amount.
Councilman Jeff Masterson, who's in favor of the tax hike, released this statement:
"To balance our budget we have two options, raise revenue or make cuts. No one, including myself, likes raising taxes, but the cost of running the city has gone up. If it hadn't, our sales tax would be at 7 percent instead of 8 percent. Keep in mind, most everyone around us is already at 9 percent. My goal is to fund the school system the 38.3 percent of the sales tax, like the city school system was set up in its inception, and maintain city services with everyone still employed. I've drawn unemployment at Christmas time before, and its not a good feeling. Therefore, with the average basket cost at Walmart at around $40, that's an additional 40 cents I'm willing to pay each time to educate our students and keep everyone employed."
Not everyone is in favor of raising taxes. The proof is clear in the dozens of signs that say, "No New Tax", that are posted all over the city.
Russellville resident Milford Brown put up the signs.
"To me, that's the last step and not the first step in trying to solve the problem," explains Brown.
Randy Bray owns Bama Signs on Lawrence Street in Russellville. Bray says he's already competing with the internet and higher sales tax would hurt his business even more. Bray feels the city needs to make cutbacks.
"They need to trim the fat," says Bray. "Maybe cut out travel expenses or cut out a few lights. Every little thing is going to help."
Brown says taxing an already taxed group of people isn't right.
"I just can't see another additional tax to put another burden on the people at this time," says Brown.
The proposed one cent sales tax increase is expected to bring an additional $1.2 million of revenue for the city. Until this issue is resolved, the Russellville City Council can't approve a budget. Council members plan to discuss the issue again at a work session on Monday.
