Our Opinion: Pot taxes and potholes: A heady blend
As Pittsfield plunges into the era of recreational pot sales, the city faces an unusual problem: the promise of extra revenue and how to spend it most wisely. At the moment, the future of municipal pot tax revenue, set at 3 percent of sales, is shrouded in smoke and fog. To date, only two dispensaries out of the eight permitted by the city are either online or about to open, so the total windfall is yet to be determined, but city councilors are already discussing options.
On Thursday, councilors on the Finance Committee hashed over the idea of dedicating 50 percent of pot tax revenue — whatever sum that may ultimately amount to — to road repair work. As Council President Peter Marchetti told colleagues, this is the beginning of a great conversation. In light of the fact that pothole repair is one of the most visible indicators to average citizens that their municipal government is doing its job, it would behoove councilors in an election year to set aside at least a portion of the pot revenues to that task.
Political considerations aside, the early institutionalization of pothole repair as a recipient of at least a portion of such funds would prevent their "disappearing" into the general fund, a move advocated by city Finance Director Matt Kerwood. Looking at the issue through his bottom-line-oriented point of view, bolstering city funds in general makes sense in that, on paper at least, the fresh infusion of money might have a favorable impact on property taxes. Viewed through a lens tinted by experience, however, the idea that any new revenue source would somehow result in the lowering of taxes is unlikely. More likely, civic leaders would find ways to spend the windfall on wish-list items while leaving existing property taxes intact.
Additionally, Mr. Kerwood told The Eagle that the city does borrow money for road repairs, and that the debt term can sometimes last longer than the repairs themselves. This would appear to be an argument for spending at least a portion of the money on road repair as it flows into city coffers, since interest payments benefit no one but the lenders.
Some councilors, like Mr. Marchetti and Earl Persip, fear that if the city designates 50 percent of the revenue for road repair, Pittsfield will be locked in to that formula whether the need exists or not. First, the same councilors who vote for such a formula can vote later to eliminate it should it prove unworkable or unnecessary. And second, considering that the city's annual road work budget is roughly $2.5 million, a great deal of cannabis would have to change hands before such a threshold was reached.
So far, city officials are moving slowly and prudently. Mr. Kerwood allowed that since the potential revenue from pot sales remains unknown, the budget process is moving forward as though it does not exist. Councilors have turned to Mayor Linda Tyer for her input. A solution she ought to consider is to dedicate half of the future revenues to road repairs now, while the city waits for a reasonable period of time to determine how much these monies will ultimately amount to. This would be following a prudent course while bringing immediate relief to Pittsfield motorists.
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