Prop. A targets earnings tax in large cities, limits options for small towns

Proposition A, an amendment to the Missouri Constitution, will be voted on Nov. 2 and could affect the authority of the Kirksville City Council to make financial decisions.

If passed, Prop. A will make four major changes in Missouri. One, it will repeal the authority of "certain cities" to implement earnings taxes to fund their budget. Two, it will make cities that already have an earnings tax, including Kansas City and St. Louis, approve the continuation of their tax every five years. Three, it will phase out any earnings tax during the next 10 years that is not approved by voters. Four, it will prohibit any city from adding a new earnings tax to fund it's budget.

The bulk of the effect of this proposition will be felt by Kansas City and St. Louis. The cities budgeted $199.2 million and $141.2 million respectively in 2010 alone, from their earnings tax, according to the ballot but Kirksville will also feel the side effects.

Melanie Smith, community service director for the city of Kirksville, said the Council does not support this proposition because it wants to reserve the right to implement an earnings tax in the future. Smith said the council has no plans of implementing one, but it doesn't want the state to tell it how it can and can't implement taxes.

The Let Voters Decide campaign was created in support of Prop. A with a $7.32 million donation to the campaign from Rex Sinquefield, a retired Missouri philanthropist, according to ballotpedia.com. LVD's main argument is that voters should be able to decide if they want a local earnings tax, according to the website.        

"A yes vote gives voters in St. Louis and Kansas City the right to decide, in future local elections, whether they want to continue their local e-tax or gradually phase it out over a period of 10 years. Equally important, voting yes on A will prohibit the politicians from imposing any new local earnings taxes on working people in Missouri," according to the Let Voters Decide website.

The media contact for Let Voters Decide did not return Index phone calls as of press deadline.

Zachary Wyatt (R), candidate for District 2 state representative, said during an interview which was published on trumanindex.com,  that he supports Prop. A.

"Cities shouldn't base their budget on taxes that they receive from people," Wyatt said. "They should base their budget on money they know they are going to have. When you base your budget on money that you're not going to get, you're more than likely going to fail and not be able to fund everything that you want to do."

Rebecca McClanahan (D), incumbent for state representative, said during a question-and-answer interview with the Index that she does not support the proposition because Missouri communities should have the right to institute an earnings tax.

McClanahan said she also doesn't support Prop. A because it would limit the ability of communities like Kirksville to use an earnings tax to fund projects like the four-lane highway between Macon and Kirksville, which was funded with an increased sales tax.

"Even beyond the implications of it, I have concerns that Prop. A is almost wholly funded and supported by one individual that is a very wealthy Missourian that doesn't like the idea of an earnings tax and essentially funded the petition drive to get that issue on the ballot," McClanahan said. "So I not only have trouble with the impact that it would have, but I also have trouble with how it got there. Because I'm not sure that one person should have that kind of power over every single community in Missouri."

For more information on Prop. A visit www.sos.mo.gov/elections/govotemissouri/ballot.aspx