Council advances municipal wheel tax ordinance to first reading amid concerns over double taxation

Greenwood staff presented Ordinance 2622, a proposal to establish a municipal wheel tax and create dedicated city funds for wheel‑tax revenue and motor‑vehicle license excise tax proceeds to help match Community Crossings Matching Grant (CCMG) awards.

A city official identified in the meeting as Mr. Right explained that recent and anticipated state legislative changes are likely to prioritize CCMG funds to municipalities that have a municipal wheel tax, and that without a municipal wheel tax Greenwood could lose access to a sizable matching pool. Staff estimated a municipal wheel tax would generate roughly $1.2 million annually for Greenwood, narrowing but not fully replacing the typical $1.5 million match needed for CCMG projects.

Council members expressed frustration that Greenwood taxpayers already pay a county wheel tax and that the state appears to be ‘forcing’ municipalities to adopt an additional local wheel tax to remain eligible for some state matching funds. The ordinance was amended to change effective dates from Jan. 1, 2026 to Jan. 1, 2027 and the council voted to suspend the rules to take the ordinance through first reading that night; the suspension vote and first‑reading amendment passed unanimously.

Staff warned that, if municipalities do not implement the municipal wheel tax, Greenwood could face difficulty matching higher‑cost CCMG projects (full‑depth reclamation and other major street reconstructions), potentially forcing the city to consider other revenue sources such as bond issuances or adjustments to local levies.

Council did not suspend rules to second reading that night; the ordinance advanced with an amended effective date and procedural steps remaining.