By Leilani Haywood
The Lee’s Summit City Council tabled a proposed 1% sales tax increase at the February 1 meeting. After Fraternal Order of Police President Rick Inglima presented data demonstrating that Lee’s Summit Police Department pay was at the bottom and not addressed in the $2.5 million Springsted compensation study, City Council voted to hold a work session to figure out options to address a projected $5 million shortfall in the city budget to bring salaries up to market.
A 1% sales tax increase and use tax was just one of the options for Lee’s Summit budgetary challenges. Other options considered are a 6% cut across the board from each city department and exploring cost containment measures. Mayor Pro Tem Rob Binney, a mayoral candidate in the April election, said, “I’m awestruck as to how we got to this point. We’re trying to implement $2 million for salary increases and suddenly it’s not enough and the compensation study is terrible. We’re being faced with a reduction in franchising taxes and every city has declining sales taxes. We have a good community with good public safety and we’ve rolled back the levy and tried to pay for things responsibly.”
Raise Sales Tax, Add Use Tax
Councilman Diane Forte noted that with a 1% increase in sales tax, Lee’s Summit would be lower than Blue Springs 8.6% sales tax. “Compared to other areas in general, the city of Lee’s Summit has one of the lower tax rates in eastern Jackson County,” says Steve Arbo, city manager.
A proposed tax increase requires voter approval. Councilman Phyllis Q. Edson expressed concern that public safety workers wouldn’t receive a raise until January 2019 if the ordinance didn’t pass. “We have a room full of people who have been put off,” she said to applause. The additional 1% sales tax could generate $15 million in additional revenue.
City Council is also exploring a 1% use tax that isn’t an ‘Amazon tax’ or tax on online purchases. According to Conrad Lamb, the city finance director, the use tax is for purchases from out of the state of Missouri. The first $2,000 spent out of state isn’t subject to use tax. “The state legislature passed Missouri clickthrough legislation in 2013 which is a use tax for online purchases. You don’t have to file use tax on the first $2,000 spent,” said Lamb.
Explore Cost Containment
“There’s a possibility of voters won’t pass this,” said Councilman Phyllis Q. Edson. “Shouldn’t we go through a cost containment exercise before we go through the voters? Why aren’t we talking about making those cuts first?” Edson moved to have a work session considering cost containment options without having to dip into the reserve fund balance for the $2 million to address wage inequities.
Arbo said he would have some ideas for cost containment “but it could be distasteful. I might bring up some sacred cows. We will evaluate public safety, public works and the $2 million.” Binney suggested public polling to get some data on how Lee’s Summit supports public safety.
Raising taxes and cost containment measures as well as pulling $2 million from the reserve fund balance are some of the options for raising salaries for Lee’s Summit police, firefighters and public safety workers. In the meantime, Councilman Craig Faith says he knows three police officers looking for a job in the Kansas City metro area. “They are not looking at Lee’s Summit for this reason. This is a problem we have now. Public safety folks are not asking for astronomical amounts but just up to market rates.”