PITTSBURG — Pittsburg City Manager Daron Hall could spend $8 million per year on street maintenance. It would keep every street looking new and give Pittsburg the best streets in the state — possibly the nation. But he knows he can’t do that — no city Pittsburg’s size can — so $2 million will do.
Voters in Pittsburg recently approved, at nearly 3 to 1 in favor, a quarter-cent sales tax for street maintenance. The tax will go into effect October 1, and combined with the current quarter-cent street sales tax, will raise approximately $2 million per year for street maintenance.
Both taxes are slated to run for five years, with the current tax expiring in 2021, and the new tax staying in effect until 2022. The newest tax was put before the citizens in the wake of the expiration of a 10-year, half-cent public safety debt sales tax. The half cent will sunset in September. The tax was used to pay debt accrued by the construction of the Beard-Shanks Law Enforcement Center and Pittsburg Fire Department Station No. 1.
Hall said funds leveraged by the state for street maintenance have been taken from the city, so the public was given the option to see the overall tax rate go back to 8.75 percent, or only decrease to 9 percent and put another quarter-cent towards roads. Of that 9 percent, the city’s portion will be only 1.5 percent — as of October 1 — with 6.5 percent going to the state and 1 percent going to Crawford County.
The citizens voted for the tax, and Hall said the city is happy to be given the opportunity to pursue these street projects.
“The two taxes are five years, and in reality five years is not going to cut it,” Hall said. “We just set those up to give the citizens a chance to look at the programs every five years and judge whether we have done our job.”
He said five year taxes also allow more flexibility. If funding for streets on the state level returns or other projects become a priority, the city can terminate the tax, or ask for another vote to redistribute those funds elsewhere after they expire.
What will the tax be used for?
The city has outlined several streets to be repaired under the 2018 additional tax — found on the graphic above. The quarter-cent sales tax will be used to overlay and repair these streets, as well as establish a cost-sharing fund — of no more than $50,000 — for city sidewalks.
Sidewalk repair is the responsibility of property owners, but the new fund will allow the city to match up to 50 percent of the cost of repairs. While repair is the main goal, Hall said some funds may be used for new sidewalks.
“It will be on a case-by-case basis,” Hall said. “The funds will mostly be used for repair, but if a developer wants to put in new sidewalk that connects to our current walkways, we may help them.”
Why sales tax?
The city would need to raise the mill rate on property taxes 8.3 mills to generate the same revenue as a quarter-cent sales tax. One mill is equal to one dollar per $1,000 of assessed value — totalling 120,000 per mill in Pittsburg.
Raising the funds for streets through property tax also takes the burden off a large chunk of people using Pittsburg streets. By acquiring revenue through a sales tax, not only property owners, but visitors, travellers and anyone else stopping in Pittsburg will help pay for repairs to the streets.
“Sales tax is the best option, especially with the record-setting number of events we’ve seen come to Pittsburg the past year,” Pittsburg Area Chamber of Commerce Vice President Devin Gorman said. “Folks coming for the SAE Baja or large track events at the Robert W. Plaster Center are helping pay for our streets, and when they see how they are maintained, they want to come back for the event again the next year.”
Residents who are unhappy with the quarter-cent tax have thrown criticism at the city — saying sales taxes are making it difficult for poorer residents to afford living in Pittsburg. However, the residents of Pittsburg will be paying lower sales taxes than they have in many years.
While the special-use tax is an added sales tax, the overall tax rate of 9.25 percent will decrease to 9 percent on October 1.
Concerns have also been raised about shopping moving out of Pittsburg to Joplin — especially because Missouri has a sales tax exemption for groceries and certain food items.
“The city is cognizant of taxes,” Gorman said. “And the chamber doesn’t expect business to decrease in Pittsburg. If folks travel elsewhere to shop, they aren’t seeing any significant savings once time, fuel and other factors are figured in.”
Neither Jasper County sales tax (1.225 percent), nor Joplin’s city sales tax (2.625 percent) exempt groceries. A person from Pittsburg buying $100 in groceries at the nearest Joplin Wal-Mart Supercenter — 1501 S. Rangeline Road — would spend $103.85 on groceries with sales tax included. The supercenter is also approximately 33 miles from Pittsburg, so a shopper would make a round trip of 66 miles, using approximately 3.3 gallons of gasoline — for a car getting an average 20 miles per gallon. At Pittsburg’s average $2 per gallon price of gasoline, their total gas cost would be $6.60, bringing their total spent on the shopping trip to $110.45.
That figure does not include the cost drive-time, or the long-term cost of extra wear and tear to the shopper’s vehicle.
The same person spending $100 on groceries in Pittsburg would only pay $109 under the sales tax effective October 1, with less time spent shopping, distance traveled and wear to the vehicle.
Gorman said well-maintained roads also help attract economic development.
“From an economic development standpoint, roads are one of the main things people look at when deciding to move to a city or start a business,” Gorman said. “They look at schools, hospitals and roads. Making sure roads are taken care of is a great way to get folks here, as well as keep events coming to Pittsburg.”
He said the city will still see a decrease from the current tax rate as well.
“Regardless of if the quarter-cent tax passed, the rate was decreasing,” he said. “The question posed to the citizens was how much they wanted to see it go down.”
— Chance Hoener is a staff writer for the Morning Sun. He can be emailed at firstname.lastname@example.org or follow him on Twitter @ReporterChance.