Chesterfield may soon get to keep more of its sales tax | St. Louis Public Radio

Chesterfield may soon get to keep more of its sales tax

May 11, 2016

The Missouri Senate has approved a change to St. Louis County’s complicated and controversial system for distributing a 1-cent sales tax.

Now, it’s up to the Missouri House whether to support or reject the idea.  And then Gov. Jay Nixon will decide whether to agree.

The Senate-passed bill would change the distribution system for the county’s so-called “pool” cities, which are municipalities that pool their share of the sales tax together and divvy up the proceeds based off population. 

The bill, under certain circumstances, would allow pool cities to keep at least 50 percent of their proceeds. This would likely result in a revenue boost for places like Chesterfield, which has been trying to change the pool tax system for years.

Sen. David Schatz, R-Sullivan, represents most of Chesterfield. He’s strongly supportive of the change, which was included in a broader bill altering local government regulations.

“I did a lot of work during the interim,” Schatz said earlier this week. “I met with every senator in St. Louis County. I met with several mayors. And I said ‘this is a reasonable approach’ to a ‘nuclear option.’

“A nuclear option is basically phasing out the pool,” he said. “So I would say ‘I would take ‘reasonable.’ And I think that was fair.”

Schatz said he promised that if his proposal is approved, he won’t revisit the pool issue again.

Legislative efforts to change the pool-tax system have failed for decades, largely because any change often hurt another city. Pat Kelly of the St. Louis County Municipal League said this particular proposal “has a limited effect on the pool.”

“Because [some cities] are taking some of the revenues out of the pool, then the other [pool] cities’ revenues will grow – but not as fast,” Kelly said. “I’m going to just use this number: If everyone was going to get a 3 percent increase in revenues without those changes, now the majority of the [pool] cities would get a 1 percent increase in revenue. And those ones getting 50 percent of their revenue may be getting a 4 percent increase in revenue.”

Chesterfield officials have long complained they don’t get enough money from the system, noting that the city became a retail mecca in recent years.

But Kelly, a former municipal official, said he isn’t that sympathetic. He noted that joining the pool was a prerequisite for Chesterfield being allowed to incorporate as a city in the late 1980s.

“It’s not like they’re not able to pay their bills,” Kelly said. “So they’re changing the pool and they’re going to gain an additional $200,000 in revenue for their $40 million a year budget – something like that. So my question would be really to Chesterfield: ‘Really? I mean, what is this really for?’ ”

The bill that passed the Senate does not include a measure authorizing a vote for a sales tax hike to fund the St. Louis County Police Department. That's been a major goal for St. Louis County Executive Steve Stenger over the past year.