The Raytown Board of Aldermen will hold its first reading of an ordinance to re- finance the 350 Live TIF Bonds at Tuesday night’s meeting. The anchor of the TIF project on 350 Highway Walmart.
The TIF bond obligation is the main reason Raytown has had tight budgets since the bonds were issued in 2007. The original amount of the TIF project was $39,990,000.00. Despite over ten years of payments on the debt, the City still owes $31,240,000.00.
The proposal before the Board of Aldermen would re-finance the loan at a rate of 4.5%. Most municipal bonds in Missouri are offered around 3%. The high rate reflects the amount of risk investors expose their funds to by investing in the bonds. Unlike the current bonds, the new issue of bonds will not be backed by the good faith of the city.
The length of term for the new financing extends the debt period required by two years (moving the final payment from 2028 to 2030).
This is a very important decision that will have a huge impact on everyone living in Raytown. The people of Raytown and their representatives on the Board of Aldermen have had little opportunity to explain and discuss this very important vote publicly.
A Little Transparency Please
The information given in the city’s official Ordinance Packet does little to shed light on the additional costs taxpayers will be liable for if the bonds are re-financed.
It is understood the Board is taking this action to lessen the cost of future TIF payments. What has not been released is how much more the city will be paying due to a higher interest rate and an extended timeline on the debt.
The people in Raytown deserve to know answers to such questions. Those answers should be made publicly by the Mayor and Board of Aldermen.. They should do so in a timely manner and give the people they serve at least a week to learn of the commitment elected officials are making for them.
The following story is about an editorial the Kansas City Star published on Sunday, October 14, 2018). It’s title . . .
KC voters keep raising their own taxes. When will it be too much?
“The owner of a $200,000 home in Kansas City, Earning $50,000 in salary, and spending $12,000 on taxable goods inside the city, will pay an additional $800 this year for local taxes approved by voters just since 2013.”
We wondered, where does Raytown match up in this equation? The answer was surprising. We compared the sales tax and property tax rates of the cities.
Kansas City’s sales tax rate . . . . . 8.6%
Raytown’s sales tax rate . . . . . . . . 8.35%*
*The sales tax rate is misleading. When you consider that the sales tax rate at Walmart on 350 Highway is over 10% -- AND – that Walmart creates close to 30% of the sales tax revenue in Raytown, the true sales tax rate in Raytown is considerably higher.
We compared Kansas City’s property tax levy to Raytown’s property tax levy. We took care to include the Raytown School District levy in the equation for those living in Raytown and Kansas City.
Kansas City’s property tax levy . . . . . . 9.2446
Raytown’s property tax levy . . . . . . . . . 9.1526
Then we checked other area cities and found that Raytown is in the upper tier of tax levies. In general, Kansas City leads the pack with the highest tax rates. The only exception(s) are lake communities in the metropolitan area.
The Star wrote, “as a result, Kansas City ‘s overall tax burden is high. According to a well-respected study, the city ranks eighth in the country in overall state and local tax burden for a family earning $50,000 a year.”
“In Kansas City, that family paid $5,444 in state and local taxes in 2016 – more than Chicago, Los Angeles, Boston, Atlanta, even New York City.”
Given Raytown’s ranking in tax rates in the Kansas City area, the statistics show how deeply we are affected by high taxes in Raytown.
Remember these facts next time someone tells you how low your taxes are in Raytown.
Speaking of Taxes . . . VOTER BEWARE!
There is a state-wide Missouri Gasoline Tax increase on the November ballot. Voters would be wise to carefully read the fine print. The gasoline tax is not a low impact tax.
The first year of the tax increase will cost the average driver about $26 a year. However, once the tax is fully implemented the cost per year balloons to $104.00 annually.
USE THIS LINK TO VIEW THE EDITORIAL: KC STAR