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An appropriations bill has been introduced to eliminate State <br />reimbursements to localities for the past repeal of business <br />inventory property taxes, some intangibles taxes, food stamp sales <br />taxes and for the "homestead" property tax exemption of low- income <br />elderly and disabled citizens. The Governor has supported replacing <br />these reimbursements with a 1/2 % sales tax. <br />The League supports the additional sales tax as a more stable and <br />permanent revenue source in lieu of the reimbursements. The League <br />strongly supports allocation of such additional sales taxes so that <br />each locality will receive no net reduction. <br />The Town receives about $300,000 annually in State reimbursements <br />under current formulas. This amount equals revenue from about 2 <br />cents of the property tax rate. Without the reimbursements, a <br />replacement funding source will be very important in addressing our <br />1991 -92 budget. <br />2. Alternatives to the property tax. <br />The League is supporting a legislative study commission's proposal <br />for State -wide enabling legislation for local option payroll, <br />hotel /motel, real estate transfer, admissions and prepared meals <br />taxes. <br />I recommend supporting State -wide authorization for these local <br />option revenues. The General Assembly's actions and the local <br />legislative delegation's support for new revenue sources such as <br />our occupancy tax have been a very important in helping the Town <br />have stable tax rates for several years. <br />3. Vehicle license fee <br />In the January retreat meeting, the council discussed seeking <br />authorization to increase vehicle license fees, which are now $5. <br />An increase from $5 to $10 would generate about $90,000 annually <br />or the equivalent of slightly more than 1/2 of one cent of the <br />property tax rate. <br />I recommend the council request authorization for a maximum vehicle <br />license fee of $20 per year. <br />A recently introduced bill would provide for more efficient and <br />equitable property taxation of vehicles by requiring the Division <br />of Motor vehicles to provide timely vehicle registration <br />information to County Tax Offices. <br />4. Continued State funding for Town fire protection services to <br />the University and University Hospitals. <br />The Town now receives $296,000 annually from the State, which is <br />equivalent to almost.2 cents of the property tax rate. The <br />legislators have been sensitive to the importance of this funding <br />