Businesses Buying Off On Phillips' Tax Increase Idea

Suzanne Klapp tweaked it. Kathy Littlefield embraced it. Jim Lane gave it his blessing. But it was Guy Phillips who originally proposed it.
 
Depending on political perspective, Councilman Phillips either deserves the credit or the criticism for proposing the issue that will be on the November 6th election ballot: raising the city's sales tax rate.
 
Phillips served on the Capital Improvement Plan Subcommittee with Councilmembers Virginia Korte and David Smith. During all of 2017, the three studied the best way to fund $350 million of repairs to some of the city's failing infrastructure.
 
Before being appointed to the subcommittee by Mayor Lane, Korte and Smith had leaned toward using general obligation bonds to address infrastructure needs. Phillips, on the other hand, favored increasing the sales tax. After 12 months of weighing input from support staff, various city departments and City Treasurer Jeff Nichols, Korte and Smith steadfastly supported the bonds option and Phillips still proposed raising the sales tax.
 
Phillips' proposal wasn't taken seriously. After all, according to City Manager Jim Thompson, increasing the sales tax rate wouldn't come close to funding the 90 infrastructure projects that are needed. Raising taxes in Scottsdale has typically been a non-starter. Besides, even the mere mention of raising the sales tax rate would be crushed by the business community.
 
Proposing to increase the sales tax made no sense ... so why bother?
 
Phillips, a two-term councilman, has had an estranged relationship with the business community since he emerged on the political scene. In fact, during his 2012 council campaign, it was the business community, with encouragement from the mayor, that spent tens of thousands of dollars trying unsuccessfully to defeat Phillips.
 
Now, Lane, Klapp and Littlefield have fallen in line behind Phillips to raise the sales tax rate. Councilmembers Korte, Smith and Linda Milhaven oppose Phillips' proposal and instead favor using general obligation bonds to fund infrastructure projects. They say that employing bonds would have been more fiscally responsible. The three add that bonds wouldn't have raised taxes because they would have replaced previous bonds that are expiring. The new bonds would also have been designated for specific projects, making them more transparent than a sales tax increase for unidentified projects.
 
So far, the business community has been mute.
 
The Chamber of Commerce not only didn't try to block putting Phillips' sales tax proposal on the ballot, the organization hasn't even taken a public position on it. Likewise for the Chamber's junior varsity team, SCOTT (Scottsdale of Today and Tomorrow), which is funded by the who's who of the business community.
 
Even more stunning is that Old Town business owners, whose businesses would be impacted by a sales tax hike, are, by their very silence, supporting the tax increase. The gallery association hasn't spoken up. Neither has gallery owner Bob Pejman, a political gadfly in the downtown area. Their silence raises suspicions.
 
For instance ... imagine the reaction from downtown merchants if it had been Councilwoman Linda Milhaven who had proposed raising the sales tax rate. They would be going stark raving mad.
 
It now looks like Guy Phillips and the business community have finally
buried the hatchet and will be working hand in hand, to of all things ... raise taxes.