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March 28th, 2024
L&T Opinions Page

earl wattL&T Publisher Earl Watt

 

Removing sales tax on groceries is a good thing. Kansas is only one of a handful of states left that has a state tax on groceries, and despite the Legislature trying to get rid of the tax in the past despite resistance from Governor Laura Kelly, she somehow positioned herself as though it was her idea.

But, as Ronald Reagan said, it’s amazing what can be accomplished when we don’t care who gets the credit.

Getting rid of the state sales tax on groceries is good, but there is another issue that is complicating matters, and that is the Legislature considering eliminating any and all taxes on groceries, including local taxes.

This becomes very significant to use here in Liberal.

For one, we have the 1-cent sales tax, better known as the Focus on the Future tax. This tax was originally passed in 1993 and has been renewed by the voters in 2000, 2010 and 2020.

The sales tax allows us to make improvements throughout the city, from streets, drainage and capital improvements to beautification, crime prevention, housing and economic development.

The fund brings in about $4 million per year.

But if the state initiative is passed, the 1-cent sales tax that is reflected on grocery purchases will go away. That could be a sizable chunk that has been used for local improvements through the 1-cent sales tax. I’d estimate at least 30 to 50 percent of the local sales tax comes from grocery purchases.

If the 1-cent sales tax is reduced by $1.5 to $2 million, that greatly reduces our ability to improve our community.

The only alternative to the reduction would be to increase property taxes. 

I don’t believe it is the intent of the Legislature to pass laws that result in higher local property taxes.

There is another key component to the local 1-cent sales tax. It was supported by a local vote. 

This tax was not simply imposed by a commission. It had to be taken to a public vote, and the public overwhelmingly supported it. In the 2020 renewal, the public supported the sales tax 72 percent to 28 percent.

At the time o the renewal, it was clear that groceries were included in the 1-cent sales tax, and the people voted for the self-imposed tax. 

Basically, that means taxation with representation, just like the founders wanted. 

By the state removing the local tax from groceries, it would be akin to prohibiting taxation despite representation, and it would shift the burden from the community at large as well as the economic draw Liberal has as the regional trade center to just property owners shouldering the improvements.

But that’s not the only initiative that would be affected.

A few years ago USD No. 480 also had the need to replace aging schools, and an ingenious plan was developed to provide $127 million worth of improvements with matching financial support from the State of Kansas as well as a half-cent sales tax. The remainder, about 30 percent of the overall cost of the expansion, would fall on to property owners.

With a solid plan to educate the public through the Citizens for Responsible Growth Committee, and a solid plan to provide five new schools while liquidating or razing the retired buildings, some more than 75 years old, the public again overwhelmingly supported the plan. It passed with 76 percent approval to just 24 percent opposed.

Again, this was a vote of the people. They chose to shoulder the cost with the existing financial plan.

That plan included a half-cent sales tax.

If the Legislature passes this tax reduction bill, that means a good chunk of the half cent sales tax that comes from grocery purchases will be gone, and whatever hole that leaves will have to be made up from local property owners.

This was not a tax imposed by the school board. They don’t have the authority to pass sales tax initiatives.

Instead, this was an interlocal agreement between USD No. 480 and the city of Liberal after the vote to support the bond.

The people voted for the plan and the financial instruments to fund the plan.

It is now both harmful and contradictory for the state to remove a portion of a duly passed tax by the people who are paying it.

Lowering taxes is a good thing, but in the case of removing local sales tax initiatives, all the Legislature will cause is financial hardship for local funding that has already been approved.

If the federal government tried to impose its will on the Kansas Legislature, they would reject that effort as overreach.

Why, then, would local entities not perceive the same attempt at eliminating local tax initiatives as overreach from Topeka?

If these taxes were not approved by local voters, they might have a point.

But these taxes were supported, in large numbers, by local voters. They should be viewed as binding agreements by the local voters, and state laws should not be able to change those existing agreements by eliminating a large piece of the collections.

The Kansas Legislature should continue to expedite the removal of the state sales tax on groceries, and at the same time leave local sales tax initiatives to be decided by the local voters.

LETTER TO THE EDITOR, Reita Isaacs, Liberal

 

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