Eight years. That’s how long a top Independence city official anticipates it will take a higher sales tax rate to raise enough revenue to properly fund the debt that was necessary to construct the Independence Events Center.
That’s how long a top Independence city official anticipates it will take a higher sales tax rate to raise enough revenue to properly fund the debt that was necessary to construct the Independence Events Center.
By 2020, Assistant City Manager Larry Kaufman says, the economy should improve, resulting in increased sales and sales tax collection within the Events Center’s Community Improvement District, which includes most of the busiest shopping corridor in Independence.
The Events Center CID board of directors provided a copy of its proposed annual budget slated to start July 1 to the City Council this week. Last August, the board voted 4-1 to raise the CID tax from 0.5 percent to 0.75 percent to make future debt payments due for the Events Center’s construction.
If the tax had remained at 0.5 percent, based on projections from the city’s Finance Department, not enough funding would be available beginning in 2013 to make the payments.
In a letter to the city clerk, Kaufman, who also serves as the board’s chairman, wrote, “Depending on economic conditions, refinancing of existing debt at lower interest rates may also allow a stabilization of or decrease in the sales tax levy in future years.”
The increase will affect shopping areas like Bolger Square (Target, Dick’s Sporting Goods and JCPenney), Independence Commons (Kohl’s, Best Buy and Marshalls), The Crossroads (Walmart), Independence Center mall, Hartman Heritage Center (dressbarn and World Market) and Eastland Center (Costco and Lowe’s). The Falls at Crackerneck Creek development, including Bass Pro Shops, is not included in the Events Center CID.
The total sales tax collection rate will now be either 8.35 percent or 8.475 percent, depending on where goods or services are purchased within the CID. That equates to a maximum of $8.48 in sales taxes for every $100 of goods purchased at the mall, Walmart, Target and other 39th Street-area shopping centers, compared to $8.23 in taxes now collected.
When surrounding property owners approved the CID in late 2007, they voted to impose a sales tax of up to 1 percent within the district, which meant that no additional approval from the general public, the City Council or another governing body would be necessary. The CID may remain in effect for 35 years, and the final debt payment is scheduled to take place in April 2038.
City Council members Monday night also approved the reappointment of two CID board members for additional four-year terms, including the assistant city manager (Kaufman) and the city’s director of finance and administration (Jim Harlow).
In the petition approved by surrounding property owners in 2007, it was stated that the five-member board of directors – appointed by the mayor – would consist of three city officials, either elected to serve or employed by the city, City Manager Robert Heacock said. Board members receive no compensation for their roles.