Parkville wants to limit options for using tax funds –



A delay in advancing a use tax proposal to the City of Parkville.

After originally intending to hold the first reading of the proposal at last week’s aldermen’s meeting, there was a last-minute change in plans to delay the reading.

The delay allows for fine-tuning of the proposal, Mayor Dean Katerndahl says.

“We delayed the first reading of the use tax authorization so that our city attorney could add a clause that limits use tax use to capital improvements and infrastructure,” Katerndahl said. last Wednesday morning.

“This will require not only our current board of directors, but also future councils to use the funds only for capital improvements and infrastructure,” the mayor added.

Officials plan to put the use tax proposal on the ballot in the April municipal election.

The first reading of the proposal is now set for the Dec. 6 meeting of the council of aldermen, Katerndahl said.

Use tax would require the same rate of city sales tax (currently 2%, but will be 2.5% if a half-cent city sales tax for public safety is passed) in April) must be charged on purchases made from businesses located outside of Missouri as billed by the businesses. located in the city. According to city officials, this would eliminate an inequity between in-state and out-of-state businesses, which provides a competitive advantage for out-of-state businesses.

“It’s a sales tax on out-of-state purchases, primarily over the internet. It puts those purchases on a par with purchases from local merchants,” Katerndahl said.

City officials estimated that a use tax would generate approximately $250,000 to $300,000 per year in new revenue for the City of Parkville.

“The local use tax rate is the same as the local sales tax rate. If the local sales tax is reduced or increased by voter approval, the local use tax will also be reduced or increased by the same action. If local sales tax is applied to a purchase, use tax will not be paid on the same purchase – it’s one or the other, never both,” says a policy report released by the town ahead of Tuesday night’s board meeting. “It generates local revenue, funds community projects and services and it’s not a double tax.”

In November 2021, Parkville voters overwhelmingly rejected the city’s proposal for a use tax that would have been implemented on certain online purchases. The proposal was defeated by 432 votes to 243 for, a margin of 64% to 36%. The participation rate was 13.45%.

In fact, it was the second time in the past decade that a Parkville use tax was voted down by city voters. In 2013, Parkville voters narrowly rejected a city use tax proposal, with 387 votes to 377 in favor.

Last year, in making the proposal, the city said a use tax would have eliminated an advantage that online retailers have over local brick-and-mortar retailers in the community, in that a user tax The use ensures that outside businesses pay into the sales tax fund which helps street maintenance, police and other city services.

Platte County already has a use tax in place, as do some other area entities such as Platte City, Kansas City, Platte Woods, Northmoor, and Lake Waukomis. More than 200 cities in the state have passed a use tax through a vote of their residents, according to Parkville officials.

In the policy report distributed by the city, officials indicate that the city has been advised that grant applications are recommended for approval (confirmation will occur in January 2023). These projects are:

* The next phase of highway improvements. 9, from Park University entrance west to Main Street, south to Mill Street and west to Crooked Road.

* Sidewalks on Bell Road from the highway. 45 south to Hamilton Road.

“These two projects are recommended for a grant, but there are no matching funds available for these projects. A use tax would help leverage grants to be able to fund the matching portion and continue these much-needed projects,” reads the policy report, which is tagged as prepared by City Clerk Melissa McChesney and reviewed by City Clerk Alexa Barton. administrator.

City officials said the freeway. This project has an estimated cost of $5 million, including $1 million for engineering (which is not eligible for a grant) and $4 million for construction. The city says the projected grant was initially an 80/20 proposal, but in order to award more projects, the Mid America Regional Council (MARC) adjusted the formula to a 64/36 allocation. That would mean $2,560,000 from MARC, with the city’s match being $1,440,000 of the $4 million needed for construction. Engineering costs would be borne by the city. Meanwhile, the Bell Road project has an estimated cost of $1,430,000, which includes $150,000 for engineering (engineering costs are not eligible for a grant) and $1,280,000 for construction. This grant was adjusted from an original 80/20 plan to a 58/42 allocation formula, which would mean $750,000 from ADR and $530,000 from a town twinning. All engineering costs would be borne by the city. “Even though we expect to receive about $3.25 million in federal grants, we still need to find about $3 million for twinning and engineering. While we may receive additional state and county assistance, we hopefully cannot match these grants without additional local revenue,” the mayor said.

Katerndahl said a factor in the city’s proposal for a use tax is that the city has “limited funding available for capital projects, including our local streets.

If there are funds available from a use tax, “critical capital projects for city projects and infrastructure would benefit from an available source of funding,” city officials say. .


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