Voters in the City of Jackson will have the opportunity on April 2 to decide whether the City can levy a use tax on purchases that residents make out of state. Out-of-state purchases are not subject to sales tax, and the City loses revenue when sales tax is not collected on those purchases.
A public hearing was held at the regular meeting of the Mayor and Board of Aldermen Jan. 7, but no one from the public spoke.
City Attorney Tom Ludwig reminded the Board that by passing the ordinance later in the meeting, the Board was not instituting a use tax; it was simply putting the question of a use tax before the voters on the April 2 ballot. The Board passed the ordinance unanimously.
It is estimated the City of Jackson loses $600,000 to $700,000 a year in sales tax because those purchases are made out of state and sales tax is not charged on out-of-state purchases. Had those purchases been made in Missouri, or had a use tax been charged, the City would have received its 2-1/2 percent in either sales tax or use tax.
The County and the State of Missouri already collect use tax on out-of-state purchases. If voters approve the use tax for the City of Jackson, then Jackson will receive its 2-1/2 percent use tax on those purchases as well.
A use tax is not a double tax. If sales tax is already collected on a purchase, no use tax will be collected. Use tax will only be added to purchase prices of items that are not subject to sales tax.
People who purchase items online from major out-of-state companies such as Amazon.com are already charged a use tax by the State and County.
Small vendors, such as many e-Bay sellers, are not required to charge sales tax or use tax.
Mayor Dwain Hahs told The Cash-Book Journal that if you don’t pay a sales tax or a use tax on current purchases, you will not see a use tax on similar purchases in the future. “If you’re not seeing it now, you won’t see it in the future,” he said.
In a related item, the Board agreed to pay Bold Marketing of Cape Girardeau $14,980 to help educate Jackson residents about the use tax.
In other action:
• Code of ordinances change: No one spoke at a public hearing to consider an amendment to Chapter 65 of the Code of Ordinances, regarding clarification of code wording for text amendments. The Board later approved the amendment.
• Police station: The Board accepted a proposal from Penzel Construction Co., Inc., for $6.5 million under the design-build method relative to the Jackson Police Station Building Project. The contract with Penzel Construction was approved.
• Oversized signs: The Board held a public hearing to consider a special use permit request to place two attached oversized signs (84 sq. feet) on the new Dexter Bar-B-Que building at 2305 East Jackson Boulevard, as submitted by SNL, LLC. (The signs will be moved from Dexter Bar-B-Que’s current location.) No one from the public spoke in favor of or in opposition to the permit. It was later approved by the Board.
• Meeting change: The regular meeting of the Board of Aldermen of Monday, Feb. 18, was moved to Wednesday, Feb. 20, because of Presidents’ Day.
• Park Day set: The annual Park Day was set for Saturday, April 27, beginning at 8 a.m. at Shelter No. 1 in the City Park.
• E-Cycle Day set: The City will have its E-Cycle Electronic Waste Collection Event from 9 a.m. to 2 p.m. Saturday, June 1, at the City’s Sanitation Department Building.
• Clean-Up/Fix-Up Days set: The annual Clean-Up/Fix-Up days will be the week of June 3-7.
• Baseball fields: The Board accepted a donation of $30,000 from the Jackson Youth league, Inc., to used for the construction of new baseball fields in Brookside Park.
• Depository agreements: The Board authorized the mayor to sign depository agreements with Commerce Bank, Wood & Huston Bank, First Missouri State Bank and US Bank. The City currently has deposits in these banks. Other banks could be added in the future. They are required to have a physical presence in the city to be considered.
• Annexation: The Board approved the voluntary annexation of 0.44 acres at 4080 South Old Orchard Road, as requested by the McKendree Chapel Memorial Association.
• Dedication of easement deed: The dedication of a municipal easement deed from Susan R. Jahn, trustee of the Susan R. Jahn Revocable Trust, was accepted relative to the Williams Creek Interceptor Sewer Project.
• Median break: The Board approved a change order that would decrease the contract with Fronabarger Concreters of Oak Ridge by $6,040 for the East Main Street Commercial Entrances and Median Break Project.
• 911: In study session, the Board heard an update on the status of 911 service from Scott Eakers and Randy Davis, members of the 911 Advisory Committee.
Eakers said 911 service was originally funded by an 8 percent surcharge on land-line telephones. However, with the popularity of cell phone usage, fewer people have land lines and the revenue to fund 911 service has decreased from $2 million per year 10 years ago to about $300,000 per year now.
The City of Jackson 911 service is not fully operational at this time; only basic 911 information is available to dispatchers. “We need new software,” Eakers said.
The cities of Jackson and Cape Girardeau and the County of Cape Girardeau have gone together to apply for a $600,000 grant that will help update the software. The grant has been approved, but the money has not yet been received because of the government shutdown.
The additional suite of software to go with the purchase will cost another $300,000. “All of these software companies are super expensive,” Eakers explained.
The Committee is researching ways to get more funding.
One way to increase 911 funds is to pass a 911 tax on cell phone bills. One proposal being considered is to charge every cell phone $1 a month to pay for 911 service. Even if a family has five cell phones, the total charge would be less than the $8 per month that was charged on the family’s land-line bill.
• Electric line relocation: Some city electric poles will have to be relocated for two projects: the diverging diamond interchange at East Jackson Boulevard and I-55, and at the site of the new county courthouse being constructed. The diverging diamond poles are on MoDOT right-of-way and must moved at the expense of the City; the County will reimburse the City for the costs of moving poles at the courthouse site.
• Soccer park lights: The lighted fields at Jackson’s soccer park are overused and a youth soccer club would like to see more fields lighted.
The club has raised $102,000 to cover the costs of the lights and an electrical union has agreed to donate the labor to install the lights.
The Board of Aldermen discussed in study session the need to pay about $12,000 to get an engineering study done. That study will determine a complete parts list plus determine total cost of the project. Then the City will decide whether to attempt to light the remaining six fields at one time or do the project in phases.