Hood River County will place a retail marijuana tax on the November ballot and is considering a food and beverage tax for the March election, both with the goal of alleviating the county’s massive budget deficit.
The county commission held a work session before its regular Aug. 6 meeting to talk about the budget deficit, around $1.6 million in the current year, and what to do about it.
One of the problems with fixing the deficit, however, is that the county doesn’t know exactly how big the hole in the budget is.
“We know what the hole is related to the current budget,” Hecksel said; but that current budget will be obsolete by the time the county can find more funding, and additional modeling is needed to identify how that hole impact the county’s budget in upcoming years.
Commissioner Bob Benton, District 3, said, “It doesn’t make sense (to move forward) until we have the whole hole,” but added that he disliked waiting. “We just need something to work with,” he said.
The commission requested that Hecksel and county staff come up with three budget models: How much it costs just to keep operating the same services without needed capital improvements such as vehicle repairs, extra employees or additional supplies; how much to keep the same services with needed capital improvements; and how much to operate at an ideal service level.
With the first two models, Hecksel explained, “We’re not adding any new services. There’s nothing new here.”
What the commissioners do know, after hearing from citizens at public forums, is that people want solutions.
“People really want a defined target … and the simpler I think we make that, the better,” District 2 Commissioner Rich McBride.
While the numbers are still uncertain, the commission agreed at its Aug. 6 work session that it will likely need a combination of multiple levies and taxes to balance the budget; and discussed options that they could present to voters.
Marijuana tax, food tax
A proposed 3 percent marijuana retail tax will be presented on the November ballot, the commission confirmed following a public hearing later that evening.
As no representatives of the general public were present, the public hearing was open and shut within a matter of minutes.
The proposed tax on marijuana leaves and flowers, immature marijuana plants and cannabinoid products would add an estimated $20,000 annually to the general fund.
“It’s only $20,000 but hey, it’s $20,000,” Hecksel said.
Another option the commissioners discussed during its Aug. 6 work session was a 5 percent food and beverage sales tax.
The county decided that it will pursue getting a proposal together in time for the March election so that it can add the sales tax to the March ballot should the commission choose.
The main appeal of a sales tax like this, said District 1 Commissioner Karen Joplin, is that it would apply to visitors so that tourists can contribute to the services they often use.
Any proposal would be contingent on the November election, however, as one measure on the November ballot, Measure 103, would prohibit new taxes on groceries, including food and soda, if it’s passed. However, the definition of “groceries” in the measure is still unclear, Hecksel said, so it is unclear what effect it would have on a local food and beverage tax should it pass.
Hecksel only suggested starting work now so that the commission doesn’t limit its options later on. Considering it now does not mean that the commission must make a decision on it now, he said.
If the commission decides it wants to put a food and beverage tax on the March ballot, the first reading of the ordinance would be Dec. 3.
Hecksel, along with county staff and County Counsel Lisa Davies, will begin pulling together a proposal immediately so that it will be ready for commissioners to hold public forums in October and November.