Panel to make recommendation to Crestwood board on sales-tax sharing options

City would benefit by backing sharing option, Schlink says

By Kari Williams

The Crestwood Board of Aldermen soon will take a position on sales-tax sharing bills making their way through the state Legislature.

Aldermen approved a motion to form a committee to study three sales-tax sharing bills and make a recommendation to the board regarding which one to support. Committee members were not named at the Feb. 28 board meeting.

City Administrator Petree Eastman said a proposal by the St. Louis County Municipal League, which is expected to have a sponsor within the next week or so, would allow for more income from annexation adjustment and non-pooled local sales tax — almost $119,000 for the city.

“It’s only a little bit less under the Fenton proposal. So I think the impact is in there. It will depend largely on how our numbers go …,” Eastman said.

The proposal would also leave the 1-percent sales-tax sharing in place, with no cap, along with authorizing the county to seek voter approval of a quarter-cent, local-option sales tax in unincorporated areas, according to information Eastman provided to the board.

Under the Municipal League’s proposal, St. Louis County would lose about $3 million in sales-tax revenue, but that loss could be recouped if voters approve the local-option sales tax.

House Bill 1335, which is supported by Fenton, Chesterfield and St. Ann, would put a 15-percent cap on sales tax sharing, end annexation adjustment sharing with the county and allow cities to choose if they want to be an A city or B city.

A 1977 state law designated county municipalities that were levying a local sales tax as point-of-sale, or A, cities, therefore making other cities and unincorporated areas in the county pool, or B, cities.

After 1984, if an area was annexed into a city it became a pool area.

Until 1994, A cities retained revenue generated from a countywide, 1-percent sales tax. B cities redistributed that revenue on a per-capita basis.

State legislation in 1993 required A cities to share part of the 1-percent sales-tax revenue with B cities, based on a progressive sliding scale.

However, areas annexed by point-of-sale cities after 1995 are still in the sales-tax pool.

As a result, cities, such as Crestwood, have point-of-sale and pool areas, making them A/B cities.

Additionally, HB 1335 gives cities the option of making annexation areas point-of-sale or pool, and Crestwood would gain $64,910.

The St. Louis County proposal, HB 1463, would distribute the 1-percent sales tax based on population, which Eastman said would cost Crestwood about $520,000.

Mayor Jeff Schlink said at some point the board has the option to decide if there is a particular bill it wants to support.

“I think that it’s beneficial to the city to throw its hat in,” Schlink said. “The question is do we get behind a proposal that doesn’t have a sponsor, do we support the county or, obviously, do we support Fenton and Chesterfield and a number of other cities as well that are making that proposal?”