Replacing Sedgwick County’s portion of property taxes with a sales tax would help market the area, a county commissioner said Wednesday.
“I want to talk to you about tearing up a portion of your property tax bill,” Commissioner Karl Peterjohn told members of the Downtown Wichita Kiwanis Club on Wednesday, promoting a sales tax as a way to provide a “shot in the arm to existing businesses and property owners. This would be a ‘We’re open for business’ welcome sign.”
With the city considering a sales tax to pay for some major projects, the county could put a sales tax on the November ballot, Peterjohn said.
The District 3 commissioner, who represents residents in the western half of the county, estimated that replacing the county’s portion of property taxes would result in a 1 1/2- to 1 3/4-cent sales tax. The county’s mill levy this year is 29.3 mills, which represents about a quarter of a property owner’s total tax bill. A mill is $11.50 annually on a $100,000 home. Peterjohn is not advocating replacing other taxing entities’ mill levies with a sales tax – just the county’s. The majority of the property taxes that residents pay go to schools.
Peterjohn noted that a countywide sales tax would reduce the burden for property owners and bring in money from visitors to Sedgwick County.
But not everyone is ready to sign off on the idea, which Peterjohn said he plans to push at a county financial retreat next month.
Commissioner Dave Unruh, a fellow Republican, said he’d be willing to listen to Peterjohn’s idea but “it seems to me that good government requires a balanced revenue stream. Sales tax, property tax and support from the state are our primary sources of revenue. I don’t think eliminating one leg of that three-legged stool would be a good solution.”
Depending on a sales tax could be troublesome in a down economy, he said.
“If you eliminate one source of revenue and you’re dependent on two and one of those is so dependent on the swings in the economy, I don’t believe it would provide the stability that I think is important,” Unruh said.
Commissioner Richard Ranzau said a sales tax would “put more control into the consumer’s hand” and reduce the property taxes of everyone in the county uniformly.
“In my mind, you could eliminate all of the special property tax exemptions that go to certain select individuals,” Ranzau said.
Commission Chairman Jim Skelton said he sees both pros and cons with Peterjohn’s idea.
A higher sales tax might drive people elsewhere to buy certain high-ticket items, he said.
But a sales tax might make up for the millions in dollars in property taxes that the county can’t collect, Skelton said. For example, just less than $36 million was due in back taxes to the Sedgwick County Treasurer’s Office from tax years 2000 to 2011.
“There’s a benefit there” in getting people to pay their fair share, Skelton said.