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“Voting for a sales tax is an act of faith,” said Snowflake-Taylor Police Chief Larry Scarber at the public hearing for the Jail District Tax held by the Navajo County Board of Supervisors on March 12, in which the supervisors unanimously reaffirmed the resolution to bring the Jail District Tax back to the voters in August.
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“I will have faith that Navajo County will be good stewards of these funds and I think the sales tax is the most fair way of coming up with the revenues that are needed as it spreads the cost of incarceration among all the residents of the municipalities and county as well as visitors,” continued Scarber. “STPD has the lowest contributions to the jail fees in the county. This is not because we are crime free; it is a fiscal necessity for us. The thing that scares me the most is that the medical expenses will be passed along to us now. A serious illness or injury to one of our misdemeanor inmates would be catastrophic for us.”
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Assistant County Manager Bryan Layton gave a brief overview of the shortfalls the county is facing due to the loss of coal power and how the Jail District Tax would bridge that gap of loss. “The jail district tax is not designed to be a windfall but it will fill the gap.”
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The jail district tax is a tool that a majority of counties in Arizona use to fund their mandated jail operations. The tax would be one-third of a cent sales tax for 20 years.
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As Layton said, “It is not an increase on property tax and will not be used to build a new jail. Rather it is a dedicated revenue stream to pay for the daily operation of the jail. That means the general fund money that we use today in the jail can be used to cover other expenses where we have shortfalls.”
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Layton went on to give the math behind the tax, saying that in order to account for the loss of the coal power plants, the total sales tax base of the county has to be decreased by 20 percent. The one-third of a cent tax will then generate approximately $3.5 million. “From the $3.5 million is subtracted the $600,000 increase to the state retirement system and the $450,000 that will no longer be charged to the cities and towns for their jail fees and the net gain is $2.45 million.”
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For the last decade, since the 2008 recession, the county has faced $11 million in lost sales tax revenues coupled with $5 million taken by the state for cost shifts, which forced 16 percent of the jobs to be cut as well as a reduction in capital replacement, while facing 254 percent increase in state retirement and 40 percent increase in health care costs.
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“Despite all the financial pressures of the last decade, the county has continued to evolve as a lean organization,” said Layton.
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With the impending loss of the Cholla Power Plant in Joseph City, the county is facing $2.5 million annual deficit that will seriously impact services to residents as well as put more pressure on the municipalities to cover the inmate medical costs, which as Scarber noted can be catastrophic to the towns and cities.
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Navajo County Fair Board President Mike Sample shared a letter from the fair board that stated, “If the jail district tax does not pass and cuts to budget and services must be made, it is the opinion of the fair board, unfortunately, that we would not be able to maintain the facility and keep the fairgrounds open for operation.”
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In searching for revenue streams, county staff looked at the potential of raising fees and fines as well as property tax to bridge the $2.5 million gap. Layton said, “In our revenue analysis it became apparent that increasing user fees and fines would not be sufficient and it also brings into question the customer’s ability to pay the additional fines and fees.”
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Increasing property tax puts the burden of the shortfall on 17 percent of the county’s population, which includes corporate, municipal and private land ownership, as the 67 percent of the lands within the county are the reservation lands of the Navajo Nation as well as the Hopi and White Mountain Apache tribes in which no property tax is collected.
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Layton explained that as a county the property tax rate can be increased by two percent per year, which would bring in approximately $150,000 per year. “Laws that govern property tax are designed to adjust for inflationary impacts, to cover those increases. It simply is not the right tool for the job.”
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Winslow City Councilman Bob Schlesinger noted that out of the $450,000 the county currently collects from the municipalities, Winslow was on top with $177,000. “Not having to pay that money would really help our police department. We have a committed police chief who is committed to getting the criminals off the streets and into jail. I appreciate that you are going to put this back on the ballot. We need to educate the public and we are committed to providing that education to our public.”
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Roxanne Padilla, manager of Victims Services, said that while her department is funded largely through grants, the county provides an approximate 20 percent match for the grants. “I began managing the Victim’s Service Department in 2013. We have expanded our program through grant funds to eight staff members. We have increased services to victims from 1,500 in 2013, to almost 10,000 this past year. Victim’s advocacy services are not mandated.”
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Padilla went on to say that without the tax, Victim’s Services could be cut. “We help the victims navigate the chutes and ladders of the criminal justice system, which we all know can be very challenging and difficult to understand. Even for a victim to advocate for themselves would be difficult without that knowledge. It would be a huge loss to lose a department like ours.”
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Other city officials and law enforcement personnel from Winslow, Holbrook, Heber and Show Low as well as tribal members from Pinon and Shonto spoke in support of the tax.
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It was noted by County Manager Glenn Kephart that the county had received an email from former Snowflake Mayor and Councilman Thomas Poscharsky in opposition to the jail district tax. Poscharsky requested that the information in the email be included in the ballot information.
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At the end of the hearing, Supervisor Steve Williams said, “There were two schools of thought regarding this tax. The first is that the people have already spoken. The second is if there had been better education, there would have been a better outcome. I started in the first camp, that people have already spoken, no matter how close the vote. But as I have talked with people, I have found that people voted against this because of a lack of understanding on the purpose of the jail district. Maybe we should consider sending this to the voters again with better education.”
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Williams continued, “I have also heard comments like why doesn’t the board just increase property taxes. We cannot come close to replacing the revenue we have lost through property tax and while an additional tax is not exciting; a sales is more equitable than a property. It is a fixed rate for 20 years that a future board will not have the authority to raise beyond the one-third of a cent. If the voters say no again, we respect that.”
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Supervisor Lee Jack, Sr., said, “I appreciate the plan (jail district tax) that is coming up. We need to have respect for the voters and whatever way it goes, it goes. A lot of people have said they didn’t understand and that is why we should give it another try.”
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Chairwoman Dawnafe Whitesinger commented, “We have done due diligence in looking at how we tackle this issue without impacting the public. Every community member has the right to cast a vote. We value their position, to help to educate and insure that everyone understands the impact of not having the jail district in their community.”
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At the end of the public hearing, the supervisors, which included four members, Whitesinger, Thompson, Jack and Williams, with Vice Chairman Jason Whiting absent, voted unanimously to bring the Jail District Tax back before the voters in August.
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