A half-cent local sales tax on goods purchased in South Sioux City was proposed Monday, Aug. 6 by leaders from the City of South Sioux City, South Sioux City School Board, South Sioux City Area Chamber of Commerce and Dakota County Board of Commissioners.

The sales tax would be in effect for 10 years.

The goal of the tax, which South Sioux City residents will vote on in November assuming its placement is approved by local governing boards, is to raise funds for workforce education in the school district, county-wide public safety, the 29th Street paving project and public safety bonds for South Sioux City's new fire station without raising property taxes. The tax is estimated to bring in an extra $850,000 yearly to the community, or $8.5 million over the course of the 10 years the tax would be in effect.

“We wanted to find a funding source that didn't continue to strap the property owner,” said Superintendent Todd Strom.

If the tax passes, sales tax in South Sioux City will jump from 7 percent to 7.5 percent on items such as clothing, household supplies, electronics and prepared food and drink. For example, a buyer would spend an extra 5 cents on a $10 purchase if the half-cent sales tax were to pass.

The vote requires a simple majority to pass, according to Lance Hedquist, city administrator.

The county will receive 12 percent of the revenue generated by the proposed sales tax increase, or about $102,000 of the $850,000 yearly estimate, to use toward public safety. The half-cent sales tax will not be implemented anywhere in the county outside of South Sioux City.

“It's the spirit of cooperation,” said Mayor Rod Koch, when asked about county residents receiving benefit from an additional sales tax in South Sioux City. “We all benefit from it. We're all part of the county.”

The South Sioux City School District will also receive 12 percent of the revenue generated by the sales tax increase. The remaining revenue would go to the city.

As of Oct. 1, 2018, there will be 18 towns in Nebraska with a 7.5 percent sales tax rate, which is the highest rate in the state. Lincoln and Omaha will both be at 7 percent in October. Sioux City is currently at a 7 percent sales tax rate.