St. Louis, Kansas City learning fate of earnings tax -

St. Louis, Kansas City learning fate of earnings tax

ST. LOUIS (AP) -- Voters in St. Louis and Kansas City, Mo., will decide Tuesday whether the benefit of huge tax savings outweighs the potential detriment that losing the revenue could have in their cities.
Missouri's two largest cities will learn the fate of their 1 percent earnings taxes. The tax creates about $140 million annually for St. Louis, a third of the city's revenue, and about $200 million in Kansas City, roughly two-fifths of its budget.
Under a proposition approved by Missouri voters in November, both cities are now required to hold renewal votes on the tax every five years.
Opponents argue that the tax keeps business and residents away from the cities, and they believe the cities should find other ways to fund services.
St. Louis Mayor Francis Slay said he believes residents understand the importance of the tax and a majority of them support it, but whether they'll turn out to vote is another question. Spring elections typically draw low voter turnout.
Supporters in both cities worry that that earnings tax opponents will be motivated to vote, while those sympathetic to the tax may be complacent and stay home.
The Save Kansas City Committee is spending about $1.1 million on television and radio ads and a door-to-door effort supporting the tax, spokesman Steve Glorioso said. In St. Louis, earnings tax supporters have spent about $650,000, focusing on telephone, mailings and door-to-door efforts aimed at the city's 40,000 households where voters who typically turn out in April live.
A Kansas City opposition group called Freedom PAC, funded largely by a conservative nonprofit called American Democracy Alliance, raised about $376,000 for anti-tax marketing and ads, spokesman Jason Klindt said. There is no organized opposition in St. Louis.
The two cities are among roughly two dozen around the country with similar earnings taxes, though some cities tax at a much higher rate. The median income in both St. Louis and Kansas City is around $30,000, meaning the typical resident pays about $300 a year for the tax.
People who don't live in the cities but work there also pay the tax, but have no vote in the election.
(Copyright 2011 by The Associated Press. All Rights Reserved.)

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