Petal officials are seeing good growth from the recently-implemented 3-percent tax increase at restaurants in the city – as the amount of collections has increased each of the three months the city has received those checks from the Mississippi Department of Revenue – although Mayor Tony Ducker warns there is still work to do on that front.
The first check from the tax, which was received in December, was $78,112. The check received in January was approximately $79,000, and the one received in February was approximately $87,000.
Those numbers work out to an average of approximately $81,000 per month.
“With the plan for what we need to do with those monies to justify it, we need that number to be a little higher,” Ducker said. “Sixty-five thousand (dollars) a month basically operates our Parks and Recreation Department, so all the numbers beyond that will allow us to start sitting down (to plan some things), and you’ll hear about that sooner rather than later, about some of the projects that we’re going to be able to start with those monies.”
The 3 percent tax increase was approved in early August, when 74 percent of voters voted in favor of the measure during a special election.
Unofficial records from Petal City Hall showed that 457 residents voted in the election; of that, 344 voted for the measure and 113 voted against it. The tax required a 60 percent voter approval to pass.
Under the new tax increase – which is expected to bring $750,000 in extra revenue to the city each year – an individual paying a $10 tab at a Petal restaurant will pay an extra 30 cents on that bill. The funds raised from the tax will go toward the city’s Parks and Recreation Department, which will allow the city to maintain that department at its current level.
That, in turn, will free up money in the city’s fund that could be used for measure such as the police department, fire department or infrastructure.
“The (extra) money’s going to upgrades, to ball fields,” Ducker said. “It’s going to allow us to start talking about soccer fields.
“You’ll hear more probably in the next two months on all three of those projects.”
Each month’s collection runs two months behind; in other words, checks received from the Mississippi Department of Revenue in December reflect sales that were made in October.
“You always feel like December is going to be one of your better months, with things going on,” Ducker said. “We hope to start having events and things that would have people in our town during the ‘eating’ time … like early afternoon to mid-afternoon, so people are prone to eat at our restaurants.
“It is a tax that’s going through our restaurants, so we need to make sure we’re supporting our restaurants. You’ll see some of that in the near future, where you’ll see some campaigns and things of that nature, to help those folks out as much as we can.”
The restaurant tax will not affect property, or ad valorem taxes; as a city entity, Petal has not raised those taxes in more than a decade. The city’s millage rate - which is a unit of monetary value equal to one-tenth of a cent that determines the amount of property taxes residents pay - will remain at 46.21 mills.
The idea of a sales tax increase at Petal restaurants has been passed around for the last several months as an option to increase much-needed revenue for other city programs and departments without having to raise property taxes or cut personnel. The proposal for the special election passed both houses of the Mississippi Legislature in March 2021, and the Petal Board of Aldermen voted unanimously on June 28, 2021 to set the date for the referendum.
We can’t pay somebody with money that we don’t have,” Ducker said in a previous story. “We can’t pave roads, clean ditches – I can’t do anything with money I don’t have.
“We’re going to be very conservative, and be very smart with your tax dollars, and stretch them as far as we can, so I think that’s very important. By the City of Petal, and the folks coming out and supporting that, they’re going to see the first peg – or first fruits, I guess – of that being passed.”
A similar sales tax measure was passed in Hattiesburg in early 2019, when voters overwhelmingly approved an additional 1 percent sales tax at Hub City restaurants, hotels and motels. The funds from that measure are currently going toward several Parks and Recreation Department projects around the city, including a splash pad in Palmers Crossing, an extension of the walking trail at Duncan Lake and the addition of batting cages at Vernon Dahmer Park.
