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City of Lee's Summit Reduces License Tax...
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City of Lee's Summit Reduces License Tax by 25% for Construction of New Residential Structures
March 19, 2010
The Lee’s Summit City Council created an attractive incentive for both builders and homebuyers by adopting a 25% reduction in the License Tax on Building Contractors residential structures at the March 18 City Council meeting.
The City Council’s decision to reduce the license tax was a recommendation of the License Tax Review Committee, which sanctioned this move at the group’s February meeting based primarily on economic conditions, effecting builders and homebuyers, as well as the decreased number of new housing starts in the City.
The last time the City Council changed the license tax was a 3% increase two years ago – the first time the tax was increased since it was adopted in 1997.
Lee’s Summit housing starts have been decreasing for the last several years due to the country’s slumping economy. In 2009, Lee’s Summit issued 164 single-family residential building permits compared to 151 in 2008. During more robust economic times, the City on average issued 1,200 single-family housing permits annually. What we’re experiencing in our community, however, closely mirrors the rest of the country.
According to a BusinessWeek magazine on-line article, “the Commerce Department reported that housing starts fell 12.8% to a record-low pace of 458,000 in April 2009 from a revised 525,000 in March 2009. This crucial measure of new home construction is down more than 54% from a year earlier and 79.8% below the 2.27 million peak in January 2006.”
Everyone stands to win by increasing housing starts in the City. Builders are able to stay operational employing workers and homebuyers are able to build and set-up a home in the one of the country’s premier communities, Lee’s Summit.
The License Tax was adopted by voters in 1997 to help pay for needed road improvements associated with new developments. Here are some of the projects this source of revenue played a major role in funding:
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