Finance director explains 1-cent tax extension does not raise taxes Print
Tuesday, 26 October 2010 10:44

• Daily Leader
With the 1-cent sales tax vote right around the corner on Nov. 2, there has been some confusion regarding whether or not the tax, if passed, will raise taxes within the City of Liberal. The answer is no, according to Finance Director Chris Ford.
Ford would like to ensure the public that extending the 1-cent sales tax will in no way raise current taxes. The tax has been in place for 16 years and if the public chooses to keep it, he said, nothing will change.
“Dealing with the 1-cent sales tax, this is the same identical tax that we have had for the last 16 years,” Ford said. “As it expires toward the end of 2011, we are asking the public for another extension of what has already been on the books for the last 10 years. It certainly is not a tax increase.”
Some of the confusion regarding the tax, Ford said, may have been generated from the rise of the state sales tax this past summer.
“I think part of the confusion may have come on when the State of Kansas increased the state sales tax by one percent back on July, 1,” he said. “That might be part of where the confusion is coming from. The city 1-cent sales tax is totally independent of the State of Kansas tax.”
Although taxes are not necessarily a welcome thought, Ford said the tax has been necessary to complete many city improvements.
“This 1-cent sales tax renewal will be the same as it has been,” he said. “People are concerned about taxes, and I don’t think people particularly like taxes, but I think we have found a mechanism in order to do all of the improvements to the community.
“Once upon a time, the city’s share of Western Avenue would have been approximately $800,000,” he explained. “Of course, since the state economy and their transportation plan is in the state that it is in, basically 100 percent of the project fell upon us, which was $4.2 million.”
Property taxes throughout the City of Liberal have also remained low due to the 1-cent sales tax, Ford said.
“This sales tax has definitely worked to keep property taxes low,” he said. “Streets and drainage alone, you figure that in order to do all of the improvements that we have done on an annual basis, the city property tax would have to be increased by a third in order to generate the funds to be able to do that.”
Although the City of Liberal will be reaping the benefits of the tax and alone deciding if the tax will remain in tact, one third of the fund generated from the 1-cent sales tax have and will come from outside of Liberal.
“We have been approximating that two-thirds locally and one-third from outside of the community,” Ford said. “We approximate over the 10 years, $35 million of revenue, $3.5 million per year. Then, approximately $12 million would come in from outside the community.
 “This way, whether you are or are not a property owner, a resident of Liberal, not a resident of Liberal – all of those pennies from every dollar of retail purchase add up and are able to do some very good projects,” he added.
Ford said there has been some controversy regarding the possibility of the tax funding a future recreation center. However, he said, the city commission has a resolution to put the issue to a vote in May, if the 1-cent sales tax does pass again.
“The other important thing to mention too, is the 1-cent sales tax vote is in November,” he said. “I know there has been a lot of talk about a recreation center. Some people are for it, some people are not for it. The commission has adopted a resolution where by shall the 1-cent sales tax pass in November, the following May, there will actually be a public election on a recreation center.” 
Ford explained the process of collecting and distributing all taxes within the State of Kansas.
“Essentially, a retailer upon making a retail sale, will report their sales and pay their taxes depending on what their payment schedule is – some people are weekly, some are monthly, some quarterly and some annually,” he said. “Those monies go to Topeka and they have their allocations – the 6.3 percent State of Kansas tax, they keep it. Then the county and city taxes are distributed back out through the treasurer’s office. We receive our notice of distribution and deposit our money.”

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