Thu, Nov 26 2009
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Cities facing taxing issue “The stakes are very high,” Head said of Burcham’s challenges. “The stakes are very high because a lot of improvements we have seen in crime and the Police Department are funded with this tax. Fire safety also is at risk, since added firemen and additional fire substations are paid for with the tax revenue.
“If this tax goes away, there is no additional authority in the law to replace it with some other tax.” Joplin’s tax Voters approved the half-cent public-safety sales tax in 2006. It has generated about $12.4 million since collections began in early 2007. Since then, about $5 million has been spent, leaving a balance in the fund of about $7.3 million. The fund has been used to install more streetlights in neighborhoods with elevated crime rates, hire more police officers and firefighters, and equip police with more sophisticated computers, laptop computers and ticket writers, and establish a police substation. The city is looking for a site to build a fire substation to serve residents in the growing west section of the city. Mount Vernon’s tax Burcham has a lawsuit pending against Mount Vernon, but city officials there appear to have found a way to skirt the challenge. Voters in Mount Vernon approved a 1-cent general sales tax in 1976. In 1988, they passed a half-cent sales tax for capital projects and, in 2003, another half-cent tax for capital projects to be used for street projects. Even though state law seems to say that cities can have only one capital-projects tax, the city in 2003 “got a letter from the (state) Department of Revenue saying it was OK,” said John Rice, the city administrator. Burcham had an associate come to Mount Vernon, buy $10 worth of items at a store there, and later filed a lawsuit against the city’s sales tax in Lawrence County Circuit Court, a tactic Rice questions. “Our stance on the whole thing is it was a fair election, the people voted on it, the people of Mount Vernon imposed the sales tax, so we’re really not sure how a person from Farmington has an interest in that.” “If this were a tax levied only on the people of Mount Vernon, the city administrator might have a point,” Burcham responded. “However, sales taxes are levied on people both within the city and people who don’t live in the city who don’t have a chance to vote on the tax.” He estimates that up to 40 percent of a city’s sales-tax revenue is paid by outsiders. The two Mount Vernon taxes generate about $1 million a year, half of the city’s $2 million operating budget if revenue from the water, sewer and electricity utilities are excluded, the administrator said. City officials didn’t wait on the lawsuit to be resolved to take action to avert a loss of revenue. 
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