County asks for legislature to fund tax reduction fund



The Marion County Board of Commissioners approved a letter to send to the Senate Tax Committee in support of SB 196 in their meeting on Monday. SB 196 would restore the Kansas Legislature’s legal obligation to fund the Local Ad Valorem Tax Reduction Fund (LAVTR) and provide true property tax relief.

The board points out in the letter that the LAVTRF is currently supposed to transfer 3.63% of state sales and use taxes to cities and counties.

“Revenue sharing in this manner dates back to the 1930s, with the current statutory framework having been established in 1965. At that time, the local share of certain cigarette revenue stamp taxes and cereal malt beverage taxes were taken from the local government and rolled into the state general fund. A direct transfer was made into LAVTR to replace this loss of funds,” the letter said.

County City Revenue Sharing (CCRS) is supposed to transfer 2.823% of state sales and use taxes to cities and counties. CCRS was established in 1978 as part of an agreement between State and local governments regarding several different taxes.

This time-tested partnership was effectively canceled in 2003 when the Kansas Legislature made no fund allocation – a practice the Legislature has continued each year since. The LAVTR and CCRS funds were part of an agreement between the state and local governments that involved the loss of revenue sources in exchange for the establishment of these funds.

Additionally, in 2006, the Kansas Legislature exempted new machinery and equipment (M&E) from property taxation. The final bill included partial reinstatement of the LAVTR fund because the M&E exemption would harm local budgets. Yet cities and counties did not receive LAVTR payments.

The board explained that Marion County’s greatest funding challenge used to be funding infrastructure for safe and efficient transportation. Today the county’s challenge is the continued flood of unfunded mandates, taking control and restricting of revenue sources by higher levels of government. The letter stated that for 2022 in Marion County, the restoration of the agreement would equal $591,356 or 3.5 mills in direct property tax relief. The Marion County Commission urged the Senate Tax Committee to return the LAVTR funds to the counties. The letter declared that the board would be committed to pledge that every LAVTR dollar received will be directed to property tax relief for county citizens.

The Marion County Commission declared their support for SB 196 and asked that the committee recommend the bill favorably for passage.

In other business, the board:

* voted to have Dave Mueller remain board chairman and David Crofoot as vice chairman

* agreed to deposit Marion County funds in all Marion County banks

* heard from Marion County Treasurer Tina Groening regarding having a student from Marion High School do a work-study internship in the department. Groening explained that the student is a senior hoping to major in accounting and would like some hands-on experience that she can get with the county.

* discussed road issues, particularly in the Tampa area, with Road & Bridge Superintendent Steve Hudson and Administrative Coordinator John Beal

* met with Chris Tillison of Alloy Architecture and Health Department Director Krista Schneider and approved hiring a Construction Manager at Risk for the Health Department Project

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