Burlington region voters say no to new local taxes

Voters in three Vermont towns voted down proposed local option taxes on Tuesday, with only Essex approving a single measure. The election results show a preference for targeting visitors over residents for new revenue streams.

In Bennington, the select board asked voters to approve a single question on adopting the tax. The measure failed 3,136 to 2,292. The town projected the tax would generate about $1.8 million annually, which officials intended to use for economic development and to offset other local taxes.

Hinesburg gave voters the choice to weigh in on each specific option. The rooms tax lost by a narrower margin than the proposed taxes on meals and retail sales. The town rejected the complete slate of tax options.

Essex allowed voters to choose between three distinct options. Residents approved a new 1 percent tax on room receipts. They rejected new taxes on meals and retail sales. Because of an error in how the town warned residents about the votes, Essex will need to approve the new rooms tax again at its next town meeting.

Greg Duggan, the Essex town manager, said the vote suggested residents wanted to gather extra income from visitors rather than local shoppers. He noted that the select board sold the idea by promising the income would help pay for future infrastructure improvements.

“Throughout the process I guess we heard voters wondering how much would be drawn in from, I guess, people spending money who were not Essex residents,” Duggan said. “And so when I look at the vote being in support of a rooms tax, I think that shows that people are supportive of having non-residents pay this tax.”

Tom Haley, Bennington select board chair, said he was surprised by the lopsided defeat. “I’m disappointed,” Haley said. “I think we missed a major opportunity here, but the voters have spoken at this point and we’ll have to decide where we’re going from here. It really would have saved the people of Bennington significant amounts of money.”

State law allows municipalities to add 1 percent to state-imposed taxes on meals, alcohol, retail sales, or rooms. Towns keep about 70 percent of the collected tax, with the remainder going to the state. Fifty-one Vermont towns and cities have already adopted some form of the local option tax.

Duggan said the two rejected Essex proposals will not be brought up again. The Bennington board will now decide how to proceed following the vote.