Park sales tax increase approved for April ballot would eliminate real estate, PP taxes set in 1945

By: 
Dave Marner
Managing Editor

Owensville aldermen on Jan. 7 unanimously approved an ordinance setting ballot language for the April 2 election calling for a reduction in real estate and personal property taxes for park operations while increasing by one-quarter cent the existing quarter cent park sales tax.

The ordinance, No. 1279, is essentially the same as proposed in December but eliminates the reference to a mill tax being collected for park operations on real estate and personal property taxes of city residents and replaces it with the actual cents per $100 of assessed valuation collected currently.

“The term mill is outdated and unused,” City Administrator Nathan Schauf told aldermen at their meeting earlier this month.

Schauf told aldermen the proposal was seeking voter approval for “eliminating the property tax and increasing the sales tax” to fund park operations.

Since the park system’s formation in the mid-1940s, an appointed Park Board has controlled spending of funds generated from the two mill (two-tenths of a cent) tax per $100 of assessed valuation on real estate and personal property owned by city residents.

A quarter-cent sales tax for park operation was approved by voters in 2006 and, until the past two budget preparation cycles, control of it was largely ignored by the elected aldermen. The ability to seek voter approval for that type of sales tax was authorized by state statute which allowed municipalities to fund either park operations or stormwater control projects with a designated sales tax.

Although never an apparent issue when the quarter-cent sales tax was considered, current aldermen have since received legal interpretation of the statute which they say publicly gives elected officials control over spending of this money — $179,719.80 was collected during the 2016-17 fiscal year, according to city records. The city received $116,924.75 during the same period from real estate and personal property taxes designated specifically for park operations. 

A trend across Missouri has been to have elected boards consolidate their control over park funds governed by appointed administrative boards — a fact stated several times by one of the city’s attorneys over the past two years during budget preparations.

Under the proposed ballot question being presented in April, the Board of Aldermen would control the spending of the sales tax. An administrative, or “autonomous park board” as city attorney Leland Curtis previously described it on numerous occasions, would be replaced by an advisory board which would not have direct control over spending allocations.

Ed Sluys with Curtis, Heinz, Garrett & O’Keefe, is now handling the city’s account. 

Schauf earlier this month reminded aldermen their attorney said their position is that since the original two mill tax assessment which created the park system was being eliminated, that would also mean the need for an autonomous park board would be eliminated and replaced with an advisory one.

“If this would pass, park funding from the sales tax would be handled exclusively with this (elected) board,” said Schauf.

Mayor John Kamler reminded the board that when they were working on the 99-year lease of park grounds with the fair association that Lee (Curtis) had told them there were less than 40 municipalities in Missouri which still maintained administrative park boards.

“We could go to an advisory board,” said Kamler.

Kamler has also noted the benefit from elimination of the real estate and personal property taxes will reduce the city’s overall tax burden from its residents by 33.58 cents per $100 of assessed valuation. He also noted the sales tax will generation at least $60,000 in additional revenue annually based on prior collection records. In the 2016-17 fiscal year’s figures cited previously for this report, the sales tax generated $62,795.09 in additional revenue over what was collected in real estate and personal property taxes.

Schauf to leave city post

Schauf announced Jan. 8 his intent to leave his city administrator’s post to take the administrator’s job in Pevely, Mo., south of St. Louis. His last day will be Feb. 8. He began his career here over four years ago.

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