Chesterfield Mayor Seeking Changes to County Sales Tax System
Mayor Bruce Geiger has agreed to help lead an effort by some suburban St. Louis cities to change the current revenue-sharing system for a 1 percent county sales tax.
Chesterfield Mayor Bruce Geiger is once again leading an effort by several regional mayors and administrators to change St. Louis County's system of sharing sales tax revenue.
The St. Louis Post-Dispatch reported that Fenton Mayor Dennis Hancock hosted a meeting Nov. 30 with representatives from eight suburban municipalities, including Chesterfield. During the meeting, Geiger agreed to help lead the effort, which will require any changes to be adopted by the Missouri Legislation.
The current system originally dates to 1977, when voters approved a 1 percent sales tax in St. Louis County. At that time, cities were either designated as "point-of-sale" cities or "pool" cities, the difference being that the former kept all of the revenue generated from the tax while the latter would contribute to a shared pool.
In 1993, the legislation was changed so that even point-of-sale cities must contribute at least some revenue to the pool. The intention behind the move being that some cities, such as Chesterfield, with large retail centers should share a portion of the revenue generated since shoppers at those business come from all over the region.
What is fair?
For Geiger, the current system unfairly punishes Chesterfield and takes away the revenue necessary to maintain a bustling retail complex or a mall.
"The problem with the pool is that it shares 100 percent of the revenue, but it shares none of the cost necessary to make that revenue happen," Geiger said.
In practical terms, it usually results in Chesterfield losing about half of the revenue it generates from the sales tax. In 2011, the city collected approximately $12 million in sales tax and received $6 million back from the pool.
The amount returned to Chesterfield is based on its share of the overall population in the pool. According to Geiger, Chesterfield, the 14th largest city in the state at 47,000, accounts for 6-7 percent of the pool.
The St. Louis Post-Dispatch story cites Webster Groves city manager Steve Wylie, a proponent of the pool system, who said any change to reduce shares from areas such as Chesterfield or Fenton would be devastating.
However, for Geiger, it's a question of fairness. He said he doesn't mind paying paying into the pool but that its current bite is too big.
Geiger is advocating for Chesterfield to be switched from a pool city to a point-of-sale city, which would reduce its effective contribution from around 50 percent to 25 percent. When the law was initially set up in 1977, Chesterfield didn't have the mall and shopping centers it does now, he said.
"We operate very much as a point-of-sale city although we are considered a pool city," Geiger said.
Last year, a legislative measure to change the system never made it past a House committee in the face of resistance from St. Louis County Executive Charlie Dooley and others.
Still, Geiger said they will try again this year and have already decided to meet again with around 10 cities interested in moving forward. The city council has also voted to spend $50,000 for the services of lobbyist Mike Gibbons, who they hired last year to help press their case at the capital.