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Ashland considers using food and beverage tax for road repairs

Ashland City Council is considering diverting money from the city's food and beverage tax revenues to help pay for $10.5 million worth of road repairs.

Eighty percent of the 5 percent tax on food and beverage is dedicated toward paying off the city's wastewater treatment plant, with the remaining 20 percent dedicated to parks. Thanks to debt refinancing that lowered treatment plant payments, the tax is expected to generate a surplus $679,000 in 2017 that could be used for another project impacting tourism: roads.

City staff expects the yearly excess will grow to $1.35 million by the time the plant is paid off in 2022, according to minutes from a Feb. 29 study session.

Meanwhile, some city streets have not been repaired in 15 years. City Administrator Dave Kanner said $10.5 million in paving projects have been identified that need to be done in the next five years to prevent the streets from failing.

“It’s like going to the dentist to get your teeth cleaned," said Councilor Pam Marsh. "If you don’t, then you need a root canal, which costs a lot more money. No one wants a root canal.” 

Kanner told the council it’s possible to divert money from the food and beverage tax without going to the voters, but several councilors suggested putting it on the ballot would be advisable.

“I think if voters approved us using the money for one purpose, and we change that purpose, we should ask them,” Councilor Mike Morris said at the study session. 

Mayor John Stromberg agreed. “I have faith the voters will see the need for this and pass the measure. We need to keep our streets up.” 

Road repairs could be done in spending intervals of $2 million to $3 million so as not to overwhelm the Department of Public Works or commuters, officials said.

“If we do it that way, we can stay on top of it and get it done," Public Works Director Mike Faught said. "We’ll be busy, but we can handle it."

Nearly every major street in Ashland is due or overdue for repaving, officials said. Some streets are going to require more extensive repairs and rebuilding.

“We have the opportunity to do this now," Kanner said. "In looking at the food and beverage tax, projections continue to rise for several years to come. Even with the surplus we currently have, it makes sense to divert this money to roads projects."

The council is expected to consider the plan further in the next few months.

Email Ashland freelance writer Julie Akins at akinsj@sou.edu and follow her on Twitter at twitter.com/@julieakins.