Apr. 3—CARL JUNCTION, Mo. — Carl Junction city officials are hoping the fourth time will be a charm.
When voters go to the polls Tuesday, they'll be asked once again to decide whether the town should implement a use tax. Carl Junction residents have rejected the tax three times already.
The ballot proposition concerns a 3% use tax — equivalent to the town's current sales tax rate — on goods purchased online from retailers such as Amazon or other out-of-state vendors.
Steve Lawver, the city administrator, thinks what the problem has been for town officials eager to acquire a new revenue stream is a failure to communicate.
The first time it was put to voters in Carl Junction, towns all over Missouri were looking to implement the tax, and the ballot language the state advised them to use was worded in a negative and confusing manner, Lawver said.
That language was cleaned up for subsequent tries, and a use tax has been adopted by almost 150 municipalities across the state, including Webb City, Duquesne, Carterville and Mount Vernon. But the measure has continued to fail in Carl Junction.
Lawver said it also has been difficult to get across to people that the use tax is for online purchases only, that they will not have to pay the tax on top of their local sales tax when they make purchases in town.
The tax is simply meant to level the playing field for local businesses. Residents who buy goods online do not pay the local sales tax that Carl Junction businesses must charge.
The tax also assists municipalities with the revenue side of their budgets and provides an alternative to increasing property taxes.
Carl Junction city government operates on a $6.5 million annual budget. Town voters have approved half-cent sales taxes for streets, parks and stormwater maintenance, capital projects and, most recently, public safety. An additional 1% sales tax supports the general fund.
Revenues generated by the town's sales tax for fiscal year 2019-20 totaled about $365,000. That was without the half-cent portion for public safety that will go into effect this spring, raising the combined city, county and state sales tax rate in Carl Junction to 8.45% from 7.95%.
With past attempts to pass a use tax, town officials estimated that it could generate about $240,000 in additional annual revenue. That was at a proposed 2.5% rate. The 3% use tax proposed this time would generate about 20% more.
"It would be very close to $300,000 is what we are thinking," Lawver said.
He said the additional revenue would be divvied up among the city's various funds in the same proportions that the local sales tax revenues are.
A third of sales tax revenues currently flow into the city's general fund, which supports City Hall and Community Center operations and a good portion of the town's police department budget.
Another third is split between the street fund and stormwater and parks fund and the final third between the capital projects and public safety funds.
Last year, slightly more than 60% of Carl Junction residents voting in a June election rejected a 2.5% use tax proposal, with 418 against and 276 in favor.
This time, city officials are hoping better communication with the public and a pro-use tax group's information campaign on Facebook will turn the tide.
Lawver said the emphasis has been on letting people know exactly where the new revenues will fit into the city's budget. When people know where the money is going, they are less likely to have a problem with paying the tax, he said.