Cities are big consumers of legal, engineering, architectural, accounting, financial, and land-use consulting services. The survey, sent to the 201 cities over 2,500 population, asked cities to report their 2000 expenditures in a variety of categories. Policy makers have been using estimates based upon broad city expenditure data. The survey gathered more current and more detailed information on city expenditures. Many policy makers have expressed concern that exempting cities from the sales tax would give enterprise funds an unfair advantage against private competition.
Policy makers see the exemption as competition for other types of tax relief.
Citizen impact estimates will help them make informed decisions on tax relief. Many governmental and enterprise funds do not make regular transfers to and from the general fund. The incidence of the tax is spread among many different parts of a typical city's budget. The effect of repealing the tax would likewise be felt across the city's budget. Cities contract for many professional services including legal, engineering, architectural, accounting, financial, and land-use consulting services.