A Fine First Step in the Right Direction for Special Taxing District Reform
For decades, Missourians have been paying hundreds of millions in special sales taxes they all too often had no clue about. Special taxing districts, like transportation development districts (TDD) and community improvement districts (CID), collect taxes to (mostly) subsidize private developments. While the laws authorizing these taxes have transparency provisions, they’re seldom enforced (or are toothless), so reliable data on TDDs and CIDs are hard to come by.
Thankfully, reforms are being passed and Missouri’s shadowy sales tax mosaic may soon come into view. HB 1858 was signed into law this past Friday. The law will require all political subdivisions (such as counties, cities, TDDs, and CIDs) to submit maps of their boundaries to the state Department of Revenue. The result will be a clear and concise presentation of the myriad sales tax jurisdictions littering our state. The map should be available by July 2019.
A map of all the jurisdictions collecting sales taxes may not sound like a big deal, but it is. While it’s easy to know what county or town you’re in, it hasn’t been so easy to figure out whether you’re shopping in one or more TDDs or CIDs. These districts are required to present maps of their boundaries only when petitioning to form, and so it is often nearly impossible to figure where they are exactly later down the road. They can also be as small as a single shopping center or district! In short, you could have been paying an extra two percent in sales taxes and had no way to find out where to shop to avoid it (other than an expensive sort of trial and error).
While HB 1858 is a win for taxpayers and transparency advocates, there is still a lot of work ahead of us. TDDs and CIDs continue to be used for projects with questionable public benefits, have poor reporting standards, and operate with little to no public scrutiny. Missouri taxpayers deserve accountable, transparent government for the public good, and it’s time to give it to them.