Home Rule Board OKs Wheeling’s Sales Tax

CLARKSBURG, W.Va. – The West Virginia Municipal Home Rule Board on Friday gave Wheeling the green light to raise money for infrastructure needs and downtown development by imposing a municipal sales tax.

Board members met in Clarksburg to consider requests from Wheeling and Huntington to amend their existing home rule plans. Both cities are participants in the original pilot program giving some cities broader authority to govern themselves that the Legislature voted to extend and expand earlier this year.

In addition to charging a 0.5-percent sales tax on all goods and services except vehicles, gasoline and unprepared food, Wheeling is proposing separate legislation to reduce its Business and Occupation tax by 26 percent on retail businesses and eliminate it entirely on manufacturing and amusements. Mayor Andy McKenzie said the city wants to ease burdens on job creators.

“In cities like Wheeling, the most archaic tax system there is is the B&O tax system. … We’ve got to be competitive in West Virginia, and we’re competing with other states in Ohio and Pennsylvania that don’t have a B&O tax,” McKenzie told board members.

Revenue projections are based on an estimated $540 million in annual sales within city limits that would be subject to the tax, according to City Manager Robert Herron. Combined with an expected reduction of about $1 million in annual B&O tax collections, the city anticipates a net increase of $1.4 million in annual revenue for infrastructure needs, bonding of a $4 million renovation project at WesBanco Arena and possible construction of convention space near the venue that officials believe would lead to more private investment downtown.

McKenzie added it becomes increasingly difficult to keep up with infrastructure needs as employee pensions and health insurance costs consume a larger portion of Wheeling’s budget each year.

Clarksburg Mayor and board Chairman Patsy Trecost II asked McKenzie what the likelihood would be of Wheeling City Council enacting the sales tax but voting down the B&O tax reduction, noting the two measures are not tied together under the city’s home rule plan amendment.

“The way we sold it to the community was that we’re being very proactive to become a more pro-business community. … I believe there’s no doubt (council) will support this 100 percent,” McKenzie said.

Repairing the Baker Street Bridge across Big Wheeling Creek to the Peninsula area of the city is high on officials’ list of infrastructure needs, according to Herron. The bridge is already in need of work and will be under even more strain when traffic is rerouted away from the Schenk Street Bridge as that span is replaced.

The Baker Street Bridge project alone is expected to cost $2 million. In addition to street paving, other plans include about $360,000 worth of slip repair, bringing signage and crosswalks around the city up to state and federal regulations, stair replacement in the Glenhite area, upgrading playground equipment and rebuilding infields at city ballfields and new garages at the Stone Church and Peninsula cemeteries.

Board member Floyd “Kin” Sayre of Martinsburg said Wheeling’s proposal is “what home rule is all about.”

“You all have identified a problem and proposed a solution,” Sayre said, noting if residents disagree with those solutions, they will make it known at the ballot box. “You get a new administration, and that administration changes what was done.”

The board also unanimously approved the city of Huntington’s plan to authorize building and health inspectors to issue “on the spot” citations when they see code violations in the community, expediting the current process of bringing violators to municipal court, which can take two to three months.

Huntington Mayor Steve Williams told the board his city’s aim is not to raise revenue by collecting more fines, but to clean up the city. He said those cited would have 10 days to correct the problem without facing a penalty.

West Virginia Municipal League Director Lisa Dooley told the board she expects as many as 50 communities around the state to apply for up to 16 available spots in the Home Rule program created when the Legislature voted to extend and expand the home rule pilot program for another five years.

The original program limited participation to five cities, but only four – Wheeling, Charleston, Huntington and Bridgeport – applied. This time around, board members are expecting a much more competitive process.

Trecost believes communities around the state have taken note of what West Virginia’s home rule cities have done over the last five years, adding “the best playbooks are the ones you steal.”

“It’s no secret to anyone. … They’ve laid out a good blueprint,” Trecost said.