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Town Council wants residents to know that the total sales and use tax rate in Castle Rock is set to go from 7.5 percent to 7.9 percent Jan. 1.
Council heard a presentation on the topic at its Tuesday meeting, to which residents and business leaders were invited to provide input. Council will further evaluate the change at a special meeting in June or July. Meanwhile, Council directed Town staff to continue providing the public information about the planned tax increase.
Consumers pay sales and use tax on groceries and other retail purchases, including motor vehicles. The scheduled increase would represent an impact of 4 cents on every $10 spent.
The change is scheduled to automatically occur Jan. 1 due to decisions by Castle Rock voters.
In 1995, voters countywide approved a 15-year, .4 percent County sales tax increase for road projects. Not wanting the total sales tax in Town to increase, Castle Rock voters that same year approved a temporary .4 percent reduction to the Town’s portion of the tax (from 4 percent to the current 3.6 percent), also for 15 years. (The County, in turn, agreed to refund to Castle Rock the .4 percent collected within Town so the Town could use that revenue for transportation projects.)
The County tax initially was set to expire at the end of this year. But in 2007, voters countywide elected to extend the increase through 2030.
The Town sales tax rate still is set to return to 4 percent Jan. 1, bringing the total sales and use tax rate in Castle Rock from 7.5 percent to 7.9 percent.
The change will mark a revenue increase to the Town of $2.1 million annually. The Town plans to use those funds to support public health and safety services that have been impacted by the slow economy.
The Town has not added any additional police, fire, ambulance, streets or parks workers since 2006. In the past four years, the Town has cut nearly $40 million in projects and operations and reduced positions by 13 percent. The Town also froze employee pay for 2010 and instituted two unpaid furlough days last year.
Also on Tuesday, Council decided there will not be an election in November regarding funding for a Town transit service. General tax dollars have been shifted away from the existing service as the Town focuses on its mission of ensuring public health and safety.
Information about these and other elements of the Town’s 2010 Strategic Plan can be found online at CRchoices.com.