Tempe voters could vote on new sales tax amid budget crunch

PHOENIX – The City of Tempe is preparing to send a tax hike proposal to the ballot.

By the numbers:

It’s a sales tax the city of Tempe says would generate about $50 million a year to help cover an approximate $25 million deficit.

0.1% of the tax would go to transportation, some of it going towards extending the Tempe streetcar to Mesa.

“We need to reduce the congestion and the number of vehicles that are coming into downtown to make it a safer, easier commute for everyone,” said Downtown Tempe Authority President and CEO Lori Foster.

The money, the city says, would also go towards extending the Tempe Town Lake pedestrian bridge to Tempe Marketplace.

“It would be really great to have it on the east end because there’s so much more development happening down Tempe Town Lake,” Foster said.

 0.3% would go to public safety. Meanwhile, the city’s free and discounted preschool program called Tempe PRE would also get 0.1% of the money and expand to more families.

“Families that are involved in Tempe PRE are able to have both parents in work. They’ll be able to secure better and more permanent housing, be able to go back to school,” said Tempe City Councilmember Randy Keating.

Local perspective:

Since the Arizona State Legislature got rid of the rental tax, cities like Phoenix and Gilbert also increased their sales tax by 0.5% last year.

What they’re saying:

Lori Foster is the president and CEO of the Downtown Tempe Authority. Putting money into hiring more firefighters, police, and paramedics, she says, is important to public safety.

“The staffing is short and equipment resources are not sustainable,” Foster said.

While Bobby Nichols, who lives in Tempe, supports all three aspects of the tax, he says he disagrees with grouping them together.

“You’ve got to bite your tongue and just vote for all three instead of actually getting to express your personal beliefs on the ballot,” Nichols said.

Nichols said the deficit should be covered by tourists and large businesses.

“Raise the same amount of money by putting taxes on specific items like corporate construction, private shipping, an Airbnb, short-term rentals, hotels, motels, etc.,” Nichols said.

What’s next:

The mayor and City Council are scheduled to vote on the proposal on May 14. The city says they’re going to have informational meetings about this proposal from May through October.

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