Can local option sales tax pay for tax abatements?

The answer, for Linn County and Palo, is no, but the city may be able to use sales tax dollars to pay for tax forgiveness to flood victims.

The ballots for the local option sales tax included specific language describing what the revenue would be used for. Voters approved the tax in March in most parts of Linn County.

The county supervisors designated the county's sales tax revenue the first year to replace money lost because the jail was closed. Revenue over the next four years will be split 90/10 between repairs to rural roads and bridges and conservation improvements.

The Palo city council designated its sales tax revenue for road and sewer repairs, and maintenance of playgrounds and other park equipment.

The Cedar Rapids city council, though, designated the sales tax revenue more broadly. 10 percent is meant for property tax relief, and the other 90 percent is meant for buyouts and home rehabilitation.

The council has said it will seek state and federal assistance to cover the loss from tax abatement, and short of that, use the 10 percent portion of the city's local-option sales tax revenue.

The Linn County Supervisors will hold a press conference tomorrow at 10 a.m. to talk about the decision to abate flood victim property taxes. The meeting will be in the supervisors' board room at Westdale Mall. Representatives from the City of Cedar Rapids, the City of Palo and the Cedar Rapids School District will also be present.