Wow: New KC sales tax would last forever
The Kansas City Star
Sewer and water bills are soaring in Kansas City, where the economy is still in the doldrums.
Naturally, City Hall thinks this is the right time to ask for a big tax increase.
On Aug. 7, voters will decide the fate of a proposed half-cent sales tax that would raise $34 million a year. The money would be dedicated to financing the Parks and Recreation Department.
Mayor Sly James and other city officials are eager to sell the new tax. They point out that it would allow the city to free up millions of general fund dollars — now allocated for the parks agency — and use them for a beefed-up road maintenance fund.
Also, if voters approve the sales tax, the city would stop collecting $10.5 million annually generated by three separate property tax levies. And it would pledge to never again charge a vehicle license fee that had been costing the public $3.5 million annually until it expired this year.
Do the math, and the August election essentially asks taxpayers to pony up an extra $20 million a year to run city government starting in 2013.
Supporters and critics of this plan will have plenty to discuss in the next two months during the short campaign. I plan soon to have a more extensive piece on how the new sales tax would be used.
For now, here are two points to keep in mind as the rhetoric heats up over whether taxpayers should shell out more to City Hall.
- The Citizens Commission on Municipal Revenue’s recent recommendation to the City Council to stop dedicating specific taxes to specific causes is a loser.
Sure, James, City Manager Troy Schulte, Finance Director Randy Landes and almost everyone else in a bureaucratic position at City Hall say they hate dedicated taxes. That’s because such dedications tie the hands of the city staff when it comes to spending public funds.
But that’s exactly why voters like dedicating taxes, and why I have suggested following this path for so many taxes over many years.
Four of the five current Kansas City sales taxes are dedicated. One is for the Fire Department, another for the Police Department, and two are for transit service. The only general one is for capital improvements.
Elsewhere, Jackson County voters have dedicated taxes for an anti-drug campaign and for the Kansas City Zoo, while plenty of area cities (including Overland Park and others in Kansas) have dedicated taxes for a variety of basic services.
Elected officials can complain that voters ought to trust them, but in general people feel better about having some control over their money.
As for the proposed sales tax this year, it’s notable that James and the council just decided that it would be — yes — dedicated to the parks department.
- The citizens panel’s recommendation to stop putting short sunsets (such as five to 10 years) on many taxes is going to be embraced by the City Council.
I have been a big fan of short sunsets for almost 25 years. They help keep politicians honest in using public funds, while by no means ensuring that will always happen.
The short sunsets give voters the opportunity to pressure City Hall to change tax plans to make sure they better serve the public. For example, the police had to come up with a better proposal for how they wanted to spend their sales tax before voters renewed it in 2010.
However, it now appears the City Council and voters are moving toward supporting much longer sunsets, locking in tax revenues for many more years.
The renewed police tax will last 15 years, for instance. The bus tax that voters endorsed in 2008 also will last 15 years, three times longer than the original tax.
That brings us back to the proposed parks sales tax on the Aug. 7 ballot.
It has* no* sunset. James and the council say the Parks and Recreation Department is a permanent city agency with permanent funding needs.
We’ll see soon whether voters think this no-sunset idea is a good one.
Reach Yael T. Abouhalkah at 816-234-4887 or email him at email@example.com. He blogs at voices.kansascity.com. He appears on “Ruckus” at 7 tonight on KCPT, Channel 19. Twitter.com/YaelTAbouhalkah