Lawmakers voice support for R-7 sales tax idea | Financial IQ

The idea of a sales tax increase that would raise money for public education and to roll back local property taxes is getting positive reviews in the Lee's Summit R-7 School District.

"No one has just jumped up and down and said that sounds crazy," David McGehee, superintendent of R-7 schools, told five state legislators from this area during their Jan.26 meeting with more than 50 members of the R-7 district's Citizens Advisory Committee and Business Roundtable.

The possible sales tax increase, detailed during a discussion of alternative funding sources for local schools, was not opposed by any of the five lawmakers either.

"I would love to have my property taxes rolled back a little bit," 47th District Rep. Jeff Grisamore, R-Lee's Summit, said..

According to Grisamore, there would be stiff resistance in the Missouri General Assembly to putting any type of statewide tax increase before voters. But the proposal vetted during the Jan. 26 meeting calls for the General Assembly to allow a vote limited to the R-7 district, he said, and the assembly passes enabling legislation for "local-option" tax measures like that all the time.

"If you did a model like this, even a one-cent (sales tax) increase is a no-brainer," Grisamore said. "I think it's a viable proposal that could get through the General Assembly."

"Apparently you have your sponsor," 52nd District Rep. Noel Torpey, R-Independence, half-joked in reference to Grisamore's glowing endorsement of the proposal.

Other lawmakers attending the meeting were 56th District Rep. Mike Cierpiot, R-Lee's Summit; 56th District Rep. Kevin McManus, D-Kansas City; and Eighth District Sen. Will Kraus, R-Lee's Summit.

Torpey congratulated the R-7 community for "thinking outside the box" about school finance in the face of declining state revenues and a failed property tax levy election last year.

As outlined by McGehee, the 1 percent sales tax would generate about $15 million - about $7.5 million for local schools and about $7.5 million to finance a property tax rollback of 45 cents per every $100 of assessed valuation.

That would translate to a reduction of $216.50 in annual property taxation for the owner of a $250,000 home in the district and, for commercial building owners, a reduction of about $1,450 for every $1 million in building valuation.

But according to McGehee, the school district would work closely with city officials to determine the right amount of the sales tax increase. In the event that the city supported only a half-cent increase, he said, the district would still stand to reap $3.75 million annually, while property owners would save half the amounts listed in the example above.

McGehee didn't venture a guess on how city officials might come down on the proposal, but he said he did expect some pushback from rural lawmakers in the general assembly. Without large retail bases to apply such a tax to in their districts, he said, those lawmakers may argue that allowing the sales tax increase in the R-7 district would contribute to inequitable school financing funding.

Cierpiot said the proposal might also be challenged by those who oppose sales taxes as regressive, meaning "they hit the poor harder than the rest of us." And Kraus added that the Missouri Municipal League would probably come out against the proposal because cities may wish to retain additional sales tax authority for their own uses.

But Kraus, too, hailed the idea as an example of creative problem-solving. And McManus added that, "It makes sense to give local folks the right to excel in education, which is an economic engine for this community."

He and Cierpiot said adding sales tax to a school district's fundraising mix represented a "big step," which likely wouldn't be considered during the current session, already crowded with education issues.

But when Kent Kirby, chairman of the Citizens Advisory Committee, asked the lawmakers how the district could get the ball rolling, Cierpiot recommended getting R-7's lobbyists to start talking the proposal up in Jefferson City.

Article source: http://www.lsjournal.com/2012/02/01/v-print/78995/lawmakers-voice-support-for-r.html

Source: http://education.ahipcup.com/lawmakers-voice-support-for-r-7-sales-tax-idea/

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