Liberty voters could have a say this November in a plan city leaders believe could provide millions of dollars for street improvements without increasing the total sales tax rate consumers pay.
Liberty City Council will meet in special session Monday, Aug. 17, to consider calling a Nov. 3 election on the future of the Liberty Community Development Corporation and the half-cent sales tax that currently funds it.
If council calls the election and voters ultimately approve the measure, LCDC would be dissolved and its half-cent sales tax would go away. At the same time, the City of Liberty’s sales tax would increase by a half-cent, bringing the city’s portion to 1.5 percent. For shoppers, however, the total sales tax rate would stay the same. The difference would be where that half-cent goes.
City Manager Bryan Kendrick brought the idea to council Tuesday, Aug. 11, during a lengthy discussion about Liberty’s budget and the growing cost of repairing aging streets.
The city has been looking at a multi-year approach that would tackle some of Liberty’s worst streets while also putting more money into preventative maintenance on streets that are still in decent condition.
That work will not be cheap. One option discussed by city leaders is issuing certificates of obligation to pay for major street reconstruction. Kendrick said the city previously looked at issuing about $5 million a year over several years. Without another source of revenue to make those debt payments, however, property owners could eventually feel the impact.
Preliminary estimates discussed Tuesday, Aug. 11, suggested the first $10 million in certificates of obligation could eventually add roughly 3 cents to the city’s property tax rate if the debt were supported through property taxes.
Kendrick believes redirecting the half-cent sales tax could give the city another way to pay for that work.
The money also could help Liberty avoid falling into the same situation again years from now. Kendrick estimated that after the major reconstruction work is done, the city will need about $650,000 a year to properly maintain all of its streets.
Kendrick said the city wants to use pavement-condition data to determine where the need is greatest instead of simply fixing the streets that generate the most complaints.
The proposal, however, raises another question: What happens to economic development if LCDC goes away?
Kendrick told council that dissolving LCDC would not take economic development tools away from the city. Liberty could still negotiate incentives with businesses through other means, including Chapter 380 agreements.
He also argued that fixing Liberty’s infrastructure should itself be viewed as an investment in economic development.
“Economic development is street infrastructure and quality of life,” Kendrick said.
Businesses considering a move to Liberty, he said, are looking at more than financial incentives. They are also looking at the community they would be investing in, including its streets, parks and infrastructure.
There also is money already sitting in LCDC’s fund.
Council was told Tuesday that LCDC has approximately $3.25 million. If voters approve dissolving the corporation, the city would first have to take care of an existing obligation involving Wood Spring St. (also nicknamed by locals as the Road to Nowhere). Wood Spring connects the bypass to Lakeland Drive.
Kendrick estimated about $1.5 million could remain after that obligation is satisfied. He suggested one possibility might be putting $1 million toward streets while reserving $500,000 for economic development. No decision has been made on how that money would be divided.
Even with voter approval in November, LCDC would not disappear overnight. Kendrick estimated the process of winding down the corporation could take about six months, potentially extending into April or May 2027.
One of the concerns raised Tuesday was how the proposal will appear on the ballot.
Because the City of Liberty’s portion of the sales tax would increase by a half-cent, the ballot language will refer to a sales tax increase. Council members said residents need to understand that the increase would be offset by elimination of LCDC’s half-cent tax, leaving the overall rate consumers pay unchanged.
City Attorney Brandon Davis explained that the two actions would be tied together in one proposition. Voters would not be asked separately whether to dissolve LCDC and whether to shift the sales tax.
If the proposition fails, nothing changes. LCDC would remain in place and continue receiving its half-cent sales tax.
Council members discussed holding town hall meetings before the election to help residents understand the proposal. The city can provide factual information about the measure but cannot use public resources to campaign for its passage.
Before voters get a say, though, council has one more decision to make.
Council members agreed Tuesday to return Monday, Aug. 17, for a special-called meeting to consider formally putting the question on the Nov. 3 ballot.
The meeting begins at 6 p.m. at Liberty City Hall, 1829 Sam Houston St. The public is encouraged to attend.