After months of study, the 25-member Lincoln Citizens’ Transportation Coalition, a bipartisan group of city leaders, found that each year, the city falls about $33 million short in transportation funding. That includes $21 million for road maintenance, $7 million in signal upgrades and other improvements, and $5 million for new streets. The group proposed raising the city sales tax by 1/4 cent for six years (2019 – 2025). The Lincoln City Council voted 6-1 to place a ballot question on the April 9 Primary.
The ballot initiative would provide:
- $13 MILLION ANNUALLY dedicated to improving and building streets from curb to curb.
- FOUR TIMES more neighborhood streets rehabilitated (300+ blocks annually).
- 25% of funding to accommodate city growth and promote private economic development.
- TRANSPARENCY AND ACCOUNTABILITY through budget approvals, annual reports to city leaders and a citizen oversight committee.
- DEDICATED SAFETY IMPROVEMENTS – A portion of funds devoted to the design of railroad grade crossing safety improvements.
The Lincoln Citizens’ Transportation Coalition, made up of 25 bipartisan community leaders: City Council members Leirion Gaylor Baird, Jon Camp, Roy Christensen, Carl Eskridge, Jane Raybould, and Bennie Shobe, the Lincoln Chamber of Commerce, REALTORS® Association of Lincoln, Home Builders Association of Lincoln, the Lincoln Independent Business Association, American Council of Engineering Companies (ACEC), Associated General Contractors (AGC), Jennifer Brinkman, Lancaster County Commissioner, and many others.
The wheel tax generates approximately $19 million of the $60 million the city spends annually on the transportation system.
The Lincoln Municipal Code is very clear, the wheel tax can only be spent on transportation needs. By law, the wheel Tax can only be spent as follows:
- Residential Streets – $2.8 million (14.86%)
- Street Construction – $6.6 million (35.14%)
- Street Improvements, Operations, and Maintenance – $9.5 million (50%)
Therefore, 14.86% is used solely to rehabilitate residential streets – Lincoln Transportation and Utilities usually does so with a one to two-inch mill and asphalt overlay. And 35.14% is used for major street construction projects, new growth projects, bridge rehab and construction.
50% of the wheel tax generated is used for street maintenance and operations, such as pothole patching (about $40,000 each year), concrete replacement, street sweeping, traffic signals and signs operations, emergency operations and traffic control.
If passed by voters, the sales tax initiative that city leaders place on the April 9 ballot will last six years – October 1, 2019 through September 30, 2025.
1/4 cent raises approximately $13 million per year.
No. The revenue from any additional sales taxes must go toward street work – curb to curb. No other transportation facilities, city departments or projects can benefit from this 1/4 cent sales tax revenue.
The Citizens’ Transportation Coalition spent several months evaluating the transportation facilities in Lincoln and found a gap of $21 million per year that was needed to better preserve our existing streets and transportation system, especially in residential areas. $7 million per year was needed to upgrade traffic signals and intersections to enhance traffic flow, and $5 million per year to help address community growth and new streets. It should be noted that Lincoln spends about $2,400 per lane mile on street maintenance, compared to the average of the peer communities that spends $10,000 per lane mile. The largest gap in funding is seen in street maintenance and repair of existing streets.
Investing more in street repairs today means avoiding more expensive street work in the future. For every dollar spent on maintenance now, it saves us $8 to $15 in high-cost repairs later.
In addition to identifying about $2 million in cost savings, a majority of the Transportation Coalition members supported raising sales tax to close the annual transportation funding gap, rather than other funding options like raising property or wheel tax. Here’s why:
- It is estimated over 30% of sales tax generated is paid by non-residents, visiting Lincoln and using the City’s streets.
- A 1/4 cent sales tax will cost 2.5 cents on a $10 purchase.
- By comparison, the wheel tax would almost double in order to provide the same level of support for streets (from $74 to $132 per year).
- Property taxes would have to increase about $117 per year for an average household to generate an equivalent amount of streets funding.
The construction program will be accountable to the public in three ways:
- CITY BUDGET APPROVAL – The projects must be approved through the City Council’s budget process with vetting by city leaders.
- ANNUAL PROGRAM REPORTS to the City Council and Mayor’s office
- CITIZEN OVERSIGHT – The Advisory Committee for Transportation (ACT) will be assembled. It will meet regularly to help review program goals, projects and progress and ensure equitable distribution of funding and projects across the city.
A 1/4 cent sales tax is 2.5 cents on a $20 purchase and 25 cents on a $100 purchase. The average annual impact can vary depending on how much each resident spends annually. That impact has been estimated anywhere between $31 annually to $45. The most recent studies suggest that $45 is more consistent with today’s annual average income in Lincoln.
No. Groceries are not taxed by this sales tax.