Archive for Thursday, October 4, 2001

Business community undecided on new 3/4-cent sales tax proposal

October 4, 2001

Mail-in ballots for the city of De Soto's proposed 3/4-cent sales tax increase will apparently arrive in mailboxes before the De Soto Chamber of Commerce takes a stand on the matter.

Chamber of Commerce President Pat Atchison said the Chamber has not discussed the issue.

"We need to talk about it," she said. "The board will discuss it this week."

Phone calls to city businesses earlier this week found local merchants ambivalent about the proposed new sales tax. The calls also indicated the city may have to do more to educate the public about the sales tax. Some local business owners said they were unaware of the proposal just days before ballots arrive Oct. 10.

Last month, the city mailed 2,000 information packets on the sales tax to local residents. Each packet included a letter from Mayor Dave Anderson stating the city would have to raise property taxes to make needed street, sidewalk and drainage improvements if voters turned down the sales tax.

At De Soto's current level of retail activity, the tax would raise $250,000 annually. The money would be placed in a special fund dedicated to infrastructure improvements. The tax would expire in 10 years unless residents vote to extend it.

The city already has a 1-cent sales tax that supplements its general fund. If approved, the 3/4-cent sales tax would increase the sales tax the state, county and city charge in De Soto to 7.625 cents on the dollar. That is higher than the 7-cent total in the nearby cities of Lenexa and Shawnee.

During De Soto City Council discussions on the proposal City Administrator Gerald Cooper said a marginally higher sales tax wouldn't put De Soto retailers at a disadvantage. The city doesn't have a car dealership or other businesses offering big-ticket items that would make the increase noticeable, he said.

John Flegler, who owns De Soto Auto Parts and J-Mart, agreed.

"With the cost of fuel what it is, you're not going to save anything by driving somewhere else to save a fraction of a cent on sale taxes," he said.

Flegler questioned the need for the tax despite acknowledging the city's need to improve streets.

"I'm just not sure they don't have the money but aren't managing it right."

Out-of-town customers will help pay for the city's infrastructure improvements when they purchase goods and services in De Soto. Cooper estimated out-of-town buyers accounted for as much as 40 percent of the city's retail purchases.

Larry Gulley, co-owner of De Soto Carpet and Wallcovering, said that would be the case with his business. Seventy-five percent of his store's business is with out-of-town customers. Gulley said his business is built on its word-of-mouth reputation and doubted it would be hurt by the necessity of passing on the tax increase.

Gulley was one of the local merchants unaware of the sales tax proposal. His initial negative response was tempered when he was told the city would probably raise property taxes should the sales tax be rejected.

"I just hate to see taxes keep going up and up," he said. "At least everybody has to pay sales taxes."

As part of its educational effort for the sales tax, the city is putting together a five-year capital improvement plan that lists the projects the tax revenue would fund.

The capital improvement plan can be viewed at De Soto City Hall, the chamber office at or the De Soto library.

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