Ballwin Council Opposes Sales Tax Restructuring

The Ballwin Board of Aldermen voted Monday to oppose possible changes to the structure of the city’s shared, St. Louis County sales tax in an effort to prevent annual local losses of funds that subsidize the city budget.

The legislation being considered by Missouri House members would impact a total of roughly $12.8 million shared among municipalities that receive a portion of the county’s 1 percent sales tax, Mayor Tim Pogue said Monday.

Currently, St. Louis County’s “point-of-sale” cities, also called “A” cities, which usually have large commercial bases, are allowed to keep most of their generated sales tax revenue but required to contribute a portion to the county-wide pool.  For “pool” or “B” cities, meanwhile, the majority of that revenue is put directly into the shared pot.

Under the proposed legislation, point-of-sale cities would no longer contribute to the area pool, thus decreasing the overall amount of shared revenue. Pogue said that even with only the county’s two largest point-of-sale cities no longer contributing part of their revenue, the other participating cities would collectively stand to lose $10 million.

Without point-of-sale cities contributing to the pot, Pogue said it’s estimated that the amount distributed to the pool cities would decrease from $116 per resident to $76 per resident.

“From there, it’s estimated that this amount would continue to deteriorate,” Pogue said, citing the likelihood of additional pool-cities opting to become point-of-sale cities, thus being allowed to impose local sales taxes that wouldn’t be shared county-wide – a switch current state law does not allow.

“So that amount would continue to deteriorate until it was just one city that is part of the pool tax.”

Pogue and the board of aldermen voted without dissent to formally oppose the legislation, “because of the deterioration to our tax base that this bill would cause us.”

Ballwin isn’t alone in its opposition to the legislation.

In addition to the St. Louis Municipal League, representatives from areas such as University City also have expressed opposition.

“I admit that this tax sharing system does not look fair because the ‘A’ cities lose money to the pool –  money they could use to provide for their residents. True enough,” University City Mayor Shelley Welsch to Patch. “But this is one of those ‘greater good’ situations. And I hope most ‘A’ cities will realize this and not support the passage of HB534.”

Editor's Note: This article was last updated at 10:20 p.m. on Wednesday, March 16.  A previous version of the article incorrectly stated the projected collective and local dollar amounts participating municipalities and Ballwin stand to lose if HB534 is approved in its form to date. We regret this error.