Orchard Considers Implementing City Sales Tax

Details of how a new sales tax could benefit the Village of Orchard were shared Monday night during a community meeting.

Held at the Rex Theater, members of the Orchard Economic Development Association fielded questions about the proposed 1½ percent sales tax for economic development that will be decided by special election on Tuesday, March 12. Registered voters within Orchard city limits will vote by mail-in ballots.

The ballots will be mailed out to all registered voters within Orchard city limits on March 1. Ballots can be returned in person to the clerk’s office or mailed back, but must be received by March 12.

The ballot will have two separate questions, the first being about the 1½ percent sales tax, and the second regarding designating 50 percent of those funds to economic development within LB 840.

Tammy Cheatum, OEDA member, encourages anyone who has not registered to vote or knows anyone who has not registered, to register online by Feb. 22 or in person by Feb. 28. Cheatum said there are currently approximately 300 registered voters within city limits.

Orchard is just one of a handful of area communities not already collecting a sales tax for economic development. Neighboring communities of Clearwater and Neligh approved LB 840 plans several years ago and have already begun offering low-interest loans that have led to new businesses and job creation.

If passed, Orchard would impose a 1½ percent sales tax with allocation and use of 50 percent of the tax revenue for any project or program providing direct or indirect financial assistance to qualifying businesses. Businesses seeking low-interest loans from the sales tax collected would go through a loan review process similar to that of a bank, along with other loan requirements.

Unlike property taxes, sales tax is collected from anyone who spends money inside city limits, regardless of whether they are a resident of Orchard.

For example, if Orchard residents buy a meal in Neligh, they would pay a Neligh sales tax, which would stay in the city of Neligh, and vice versa.

“So, if I’m going to their town and helping them with their economic development, why can’t they come here and help us?” asked Stephanie Cleveland, OEDA board member.

“It’s not just Orchard giving back to Orchard, this is everyone giving to Orchard,”   Cleveland said.

“You go to every other town around here and you’re paying it, so why not pay it in your town?” questioned OEDA member Cassie Prince.

When looking at statistics, Cleveland said there would have been anywhere from $52,000 to $54,000 each year between 2015 to 2017 coming into Orchard that could have been used for economic development projects.

“I think it’s important for people to understand that anything that is currently not taxed will still not be taxed,” Laura Ferguson said.

“I think it’s a good idea,” said long-time Orchard resident Becky Moser.

“It’s about bringing stuff and doing more and making this community, making Orchard what we want it to be for our kids and for their kids and for their kids,” Cleveland said.
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The OEDA is planning to hold another community meeting when the ballots are sent out.