The Star’s recommendation | KC’s new sales tax is the wrong plan at the wrong time
Investing more dollars to improve parks and roads in Kansas City sounds like an attractive idea.
Unfortunately, the plan to increase the sales tax by a half cent to tackle these tasks — spelled out in Question 1 on the Aug. 7 ballot — is unappealing.
The Star’s editorial board recommends a no vote on this proposal.
It is ill-timed, confusing and ultimately unsupportable.
Difficult financial times require the most judicious tax increase requests. And while it was a tough call to reject the worthy goals of this ballot issue, the plan in Question 1 doesn’t pass muster.
Among our many concerns:
• Removal of three small property taxes, buried in current tax bills, isn’t a significant tax break and no urgent rationale exists to remove them. While the public generally is less hostile to sales taxes than property taxes, the temptation to hike sales taxes as the revenue source of least resistance isn’t a good enough reason to support Question 1. The Citizens Commission on Municipal Revenue recommended eliminating the three property taxes but partly as a way to offer stormwater customers some rate relief. This plan ignores that goal altogether.
• The ballot language is unnecessarily obtuse. And clear ballot explanations are sorely lacking. Even city officials questioned last week by the editorial board stumbled in discussing exactly how much extra money could be available for roads and parks in the future. Road maintenance spending figures in particular rose and fell during the discussion, as more pots of public funds were revealed. And after a “final” figure for road improvements was announced, a campaign staff email hours later claimed the total revenue was millions higher.
• Given the large number of tax-increment financing deals in effect, those projects would skim $4 million off the top of new sales tax proceeds. That’s great news for projects but cuts into the intended benefits for roads and parks.
• The request comes before the city has demonstrated its ability to significantly cut costs in pensions, health care and other big-ticket items that must be addressed to secure the city’s long-term financial health. A show of good faith in those areas would put the city on stronger footing to request more taxes from its residents.
Mayor Sly James deserves credit for helping to restore credibility to the mayor’s office and instilling a sense of pride and confidence in Kansas City’s future. City officials do appear headed in the right direction on reforming costly pension systems, the Fire Department and tax-break programs.
However, the city has not made enough progress on these issues to warrant handing over an extra $23 million a year in higher taxes, which is effectively what Question 1 would do.
And then there is the campaign literature beef. Mailed ads have not mentioned the bottom line that swapping some property taxes for a sales tax would result in a tax increase.
The defeat of Question 1 would hardly cripple local government. It would force the city staff to find money in the $500 million general fund to continue operating the community centers, just as the staff found millions extra this year to finance unanticipated buyouts for retiring firefighters.
If the tax loses, James and the council should continue to explore a future capital improvement program that could be financed through a large bond program, something he floated earlier this year.
The city also could ask voters to resurrect the vehicle license fee and finance road improvements, making it a logical user fee.
If voters reject Question 1, we’re confident City Hall can develop a better proposal to finance needed infrastructure upgrades. Voters, and The Star, have a long history of supporting positive, clear-cut plans.