|Councilman Kevin Naquin|
An ordinance to phase out a 2 percent rebate to Lafayette merchants for collecting and remitting on time sales taxes — an issue that consumed more than an hour of discussion and public comment Tuesday night — cleared the City-Parish Council by a 6-3 vote. The issue will be voted on again for final approval in two weeks.
The ordinance, brought by District 1 Councilman Kevin Naquin, failed last summer after much discussion and opposition from the business community. The ordinance originally called for an immediate end to the rebate and was co-sponsored by District 2 Councilman Jay Castille. But Naquin retooled to the ordinance to phase out the rebate over a two-year period — the rebate would remain the same in 2014 but it would be cut to 1 percent for 2015 and end entirely by Jan. 1, 2016 — and Naquin also picked up co-sponsorships by District 7’s Keith Patin and District 7’s Don Bertrand. Joining the four sponsors in approving the introductory ordinance were Chairman Brandon Shelvin of District 3 and District 4 Councilman Kenneth Boudreaux. Councilmen Jared Bellard (District 5), Andy Naquin (6) and William Theriot (9) voted against.
(Worth noting: Typically introductory ordinances are voted on as a batch rather than separately and approved unanimously by the council — as much a form of deference to an ordinance’s sponsor as a means of expediting meetings. Theriot asked that the rebate repeal ordinance be pulled from the batch and discussed separately, an indication of how controversial the ordinance is.)
In defending the ordinance, Kevin Naquin pointed out that other municipalities in the parish — Scott, Carencro and, just last April, Youngsville — ended their vendor compensation rebates, as has the Lafayette Parish School System.
“Are those towns that got rid of vendors’ comp, are they hurting? Last time I checked, Scott, Carencro, Youngsville, they’re doing fine,” Naquin said. “Super 1 went to Carencro, Scott’s got a lot of things in the works, Youngsville’s got the new Acadiana Bottling plant. What I want the people to know and the businesses to know is it’s nothing personal with me — I shop local and I will continue to shop local regardless of whether this issue fails or it passes.”
A handful of local business owners addressed the council in opposition to the ordinance, as did representatives of the Greater Lafayette Chamber of Commerce.
“Ultimately this represents a shift of resources from the private sector to the public sector — to the government,” said Joseph Zanco, chairman of the chamber’s Public Policy Division. “I do not believe such a shift is consistent with the values of the people of this community; I do not believe such a shift is consistent with the values of the people of your district.”
Zanco added that for most businesses the cost of collecting and remitting the taxes already exceeds the compensation they receive via the rebate, which was offered to merchants in the 1960s, not long after Lafayette voters first approved a sales tax.
Jason El Koubi, the chamber’s new president/CEO, told the council the ordinance sends the wrong message to the local business community and puts Lafayette in “an unorthodox position” relative to other parishes and states, the vast majority of which offer rebates to local businesses for collecting and remitting sales taxes.
Added El Koubi: “I’m concerned that doing it this way, on a very controversial issue that’s already been voted down multiple times in recent history, looks like a way to sort of do a hasty, stop-gap measure focused entirely on the retail businesses in our community.”