Laclede County Proposes Its Own Tax Cut
Patrick Ishmael and I have been writing and talking a lot about the proposal on the ballot in Clay County to reduce its very high commercial property surtax. Voters in Clay County will decide whether to reduce the surtax rate slightly to equal Jackson County’s tax rate. We think that even though the change is modest, it would be a beneficial move for economic growth in Clay County.
Not to be outdone, Laclede County officials have also decided to put a surtax reduction before voters. While the Laclede County rate is not as high as the Clay County rate, it is nonetheless very high and by far the highest among neighboring counties. Laclede County’s rate cut is also larger than Clay County’s. Laclede County officials are proposing to reduce the surtax from $1.03 per $100 of assessed valuation to $0.51. The key thing to remember is that the surtax does not roll back as assessed valuations increase, so over time as the local economy grows—and this tax cut should help it grow more—the rate remains the same and the tax revenue generated by it will increase. For the record, the $0.51 rate is right on average for Missouri counties. (Some are saying that the average rate is $1.02, but whoever calculated that clearly used a weighted average. The largest counties of St. Louis, Jackson, and Clay with their very high rates significantly alter the calculation. I think the unweighted average (mean: $0.53; median: $0.41) is preferable for comparing individual counties to each other, especially counties such as Laclede, which is economically competing more with Camden and Dallas counties than with St. Louis and Kansas City.)
The Lebanon R-3 school district is crying some wolf about the size of this rate cut. School officials claim the district will lose $275,000 per year from this; however, Lebanon R-3 is a large school district, and that figure is less than one percent of its total revenues. This is a district that received $4 million in federal stimulus funds alone last year and which is poised, like every Missouri taxing district, to soon see a significant increase in personal property tax revenues this year from the dramatic increase in used car values. The personal property tax windfall alone should make up for the potential loss of revenue from the surtax reduction, should the voters pass it.
This commercial property surtax cut should be a real benefit to economic growth and job growth in Laclede County, and it will be interesting to see what the voters decide.