Residents speak out against gas tax cap removal; city officials disagree

By: The Citizen staff report

Thursday, July 17, 2008 8:49 PM EDT

AUBURN -- The price of gasoline continued to be a hot topic for local residents and officials at city hall Thursday.
Members of the public and council sounded off during a meeting of Auburn City Council on a proposal to repeal the city's cap on sales tax for gasoline and diesel fuel. Multiple residents spoke out against removing the cap, while some members of city staff asked people to consider the benefits of such a move.

Dale Bush, of Auburn, asked the councilors to remember that they are elected by the residents, whom he said would be affected by the tax cap's removal.

"I can guarantee if you take it off, the next day (the price) is going up," Bush said.

Jim Barker, of Auburn, also urged the council to vote against the measure, which is scheduled to be on the agenda for next week's meeting.

"The county shoved it to us. They went ahead and ended it," Barker said, referring to a decision last year by the Cayuga County Legislature to repeal a similar, countywide cap. "Somebody, somewhere in government has to be responsible to the people."

Under the current cap, which was adopted in 2006, the city stops collecting sales tax at $2 per gallon. The proposed local law received a first reading during the council meeting as well. City councilors defeated a similar proposal in February.

During the meeting, councilors were given a packet outlining a small study compiled by city Comptroller Lisa Green.

According to the findings, the current cap saves a local household an annual amount of $30. That number assumes the typical car uses 500 gallons of gas a year, that an average Auburn household has two cars, and that the current cap is saving consumers 3 cents a gallon.

If the tax is removed, and the city earns the estimated $300,000 in revenue, a typical $85,000 home will see a savings of $31 a year in property taxes, according to Green's analysis.

Green told councilors that she has spoken with officials in Onondaga County, where a similar tax cap was recently repealed. According to those officials, gas prices there are based on those of the surrounding stations, she said.

"Their research indicated that the price charged by station owners is not based on the taxes," said Green, who later said she could argue both for and against the proposal.

City Manager Mark Palesh said he still supports repealing the tax cap to lower the city's property taxes.

"I think we are just playing with market forces, and we don't have the wherewithal to do it," Palesh said.

William Lupien, the city's superintendent of engineering services, also spoke in support of removing the cap.

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