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Guest speaker warns IM 28 could cut City of Aberdeen sales-tax revenue by about 10%; council to consider educational resolution
Summary
At the Sept. 16 City of Aberdeen council meeting, a Development Corporation representative warned that initiated measure IM 28 could reduce city sales-tax revenue by roughly $22.11 million (about 10%) annually, and urged the council to consider an educational resolution urging a 'no' vote; council discussed limits on formal opposition and potential budget implications.
Mike Bakery, speaking for the Development Corporation, told the City of Aberdeen council that a coalition of local and statewide organizations plans to oppose initiated measure IM 28 and urged the council to consider an educational resolution. “It could lead to a potential $22.11 million cut to the City's budget here, or approximately a 10% cut in your sales tax revenue on an annual basis,” Bakery said.
Bakery said the measure contains many unknowns, including how the term “consumable goods” would be interpreted under state law, and that uncertainty is a major reason his group opposes IM 28. “Listening to a lot of attorneys from across the state… it’s really not defined in state law as of right now,” he said, adding that the legislature would have to clarify terms if the measure passes.
Council members and staff responded with procedural and policy clarifications. Mayor Shanaman said the council cannot formally endorse or oppose an initiated measure, but “we can pass a resolution talking about the impact of that resolution potentially on the city,” a form of educational or informational action. Robin, the city manager, said staff will review potential resolutions and consider language that would be informative rather than a formal political endorsement.
Council discussion turned to what a midyear implementation of IM 28 would mean for the city budget. City staff outlined potential areas where the city could scale back spending to absorb a revenue shortfall, including delaying planned hires (the budget included three new fire department positions), postponing certain capital projects, and shifting some special-sales-tax-funded water/wastewater capital costs back onto utility users. Staff emphasized the choices would reduce the level of services or shift costs rather than immediately eliminating responsibilities.
The council did not take formal action on a resolution at the meeting but indicated staff would draft possible educational language for future consideration.
The Development Corporation presentation and the council’s discussion occurred as part of the public portion of the Sept. 16 meeting; no vote on IM 28 occurred at the local level.
Next steps: staff will draft possible educational resolution language for council consideration at a future meeting.
