In Our View: A Taxing Challenge
Clark County needs, deserves share of state sales tax rebate for rural counties
Friday, December 21, 2012
Unless somebody's entire familiarity with Clark County consists of visits to, say, Yacolt or Amboy, it might be difficult to convince them that Clark County qualifies as rural. Yet county officials are hoping to dip into the state's cauldron of sales-tax money that is reserved for sparsely populated counties.
A program in place since 1999 allows each Washington county defined as "rural" to receive a rebate from the state sales tax collected in that county. The state sales tax — not counting add-ons from cities or counties — is 6.5 percent. The rebate program, according to an article in The Columbian by Erik Hidle, returns 0.09 percent of sales to the counties in an effort to assist economically challenged rural areas.
Considering that Clark County has well over 400,000 people and is considered part of the Portland metropolitan area, defining it as rural might be a stretch. So officials are trying a different tack, hoping to redefine the law to include rural counties or, "any county that borders a state without a sales tax."
Aye, there's the rub. Every other county that borders Oregon — which does not charge sales tax — qualifies as rural and already collects money from the program. Idaho has a state sales tax, eliminating counties along Washington's eastern border from a change in the law. That makes Clark County a lone wolf, the only county that would benefit from such a change.
And why not?
By virtue of being across the river from Portland, Clark County falls victim to the "Grass is greener" hypothesis. Local residents often are drawn to Oregon stores that don't charge sales tax -- and drawn away from Clark County retailers, forcing businesses into a tenuous situation. Anybody who has walked through the parking lot at Jantzen Beach SuperCenter and taken a look at the license plates might conclude that they are still in Washington.
According to Adriana Prata, a senior management analyst for the Clark County budget office, the county loses more than 40 percent of its possible sales-tax revenue because of purchases on the other side of the state line. "I am estimating that the annual amount of leakage for 2012 is $21.9 million," Prata told The Columbian in an email.
That creates a burden on the county's finances, one born out of nothing more than location. Clark County is in a unique situation, and because of that it deserves unique consideration.
"It has less to do with 'rural' and more to do with intent of the statute," said Axel Swanson, Clark County senior policy analyst. "It has more to do with counties that need it, and we stack up with every other county in terms of need."
Making it happen, however, could be a difficult task. To alter the law will require a bill in the Washington Legislature, and thus far no local lawmaker has stepped forward to carry the torch for the county. Convincing a majority of their colleagues from across the state to alter a law for the benefit of only Clark County might reduce a legislator to the role of Sisyphus, but the effort would be worth a try.
In an age when all governmental entities are pleading poverty, any attempt to boost the county's finances is worthy of consideration. The concern, of course, is that the state Legislature would seek an opportunity to replace any money that is routed from the state coffers to the county, and local lawmakers would have to be diligent in preventing that.
While the proposal to lump Clark County in with the state's rural counties might be a long shot, any proposal that keeps taxpayer dollars close to home is worth pursuing.