By Joan Frances
No catch, it’s the truth, and amazing as it seems, the scenario of this small city is impressive.
The story starts with one man, Leonard Scarcella. First elected Mayor of the City of Stafford in 1969, he won the election 22 times for 43 years. He has seen it all. The good times and the bad. The growth of the economy and the depths of the recession.
In 1995 Mayor Scarcella and his team decided to eliminate the property taxes completely and rely on the sales taxes alone. This was a bold move but 17 years later, it still works.
The key to success seems simple, live within means. Stafford City Government has never hired anyone they do not need and has never laid off any employee. They pay competitive wages and have wonderful retirement and health care plans. They do not spend all the money in the budget every year and work as a team to save as much money as possible. They believe in maintaining a strong cash balance and a rainy day fund for emergencies.
As this concept became reality, new home owners as well as new businesses came into the city. Hotel tax, franchise tax and building permit tax all help sustain cash flow. But the largest component in financial support comes through sales tax. With the two percent tax the city is given, one percent goes to operation, half percent is applied to economic development and the other half percent goes into the municipal sales tax fund. This fund takes the place of the property tax fund. Stafford receives over three million dollars annually from this tax fund. This money can be delegated for updating equipment and improvement of the infrastructure of the city such as street repair.
A new home owner discovers that a larger home may be purchased with a smaller mortgage and no property tax.
For the past 45 years Texas Instruments played a role in the financial stability of the city. In the mid 1990’s through tax based support, this company contributed 25 percent to the economy. In the last 5 years the support has dropped to only two and one half percent. Unfortunately Texas Instruments has announced they will be shutting down the plant at the end of the year. While this is a blow to the economy, Stafford today is far less dependent on Texas Instruments then it once was.
Five hundred workers will remain in Stafford with new offices. One hundred ninety two acres of land will be available for purchase to developers which will open doors for Stafford to expand.
According to the US News, the City of Stafford is one of 10 cities in the United States with a low tax base. It is clear that a set of variables must be in place in order for something like this to be viable. People make things happen. Mayor Scarcella, a successful visionary leader, has accomplished a milestone every resident of Fort Bend County should be proud of.
Too bad he’s not running for President.