Andover voters to decide on adding another 1-cent sales tax

Andover voters will be asked in the Nov. 4 election whether they want to double their city sales tax to 2 cents per dollar to reduce property taxes and fund $13 million in projects.

The community has an existing 1-cent-per-dollar sales tax for street maintenance that began in the late 1990s. There isn’t a sunset on that tax and there wouldn’t be one on the proposed additional tax, Andover Mayor Ben Lawrence said.

Andover residents also pay a Butler County quarter-cent sales tax that began in 2010.

So the current sales tax percentage for Andover is 7.4, which includes the state sales tax of 6.15 percent.

Adding another penny for each dollar, which is expected to raise $2 million annually, would put Andover’s sales tax rate at 8.4 percent. The additional tax would start April 1.

The city’s existing 1-cent sales tax for street maintenance doesn’t have a sunset – or an end point. Andover has had 1-cent sales taxes in the past that have had a sunset, including ones to help a new library and city hall.

But Lawrence said the City Council opted in a 4-1 vote in August not to have a sunset on the proposed sales tax because the revenues from the tax would reduce city property taxes by 22 percent and pay for $13 million in capital improvement projects.

Minutes from the council’s meeting said “at least” 25 percent of proceeds from the additional tax would go to reduce property taxes. But Lawrence said the city is allotting about 50 percent – or $1 million annually – to cutting property taxes.

“Our intentions and thoughts all along were to give half,” he said. “We wanted to give ourselves some wiggle room, depending on what happens in growth and valuations as years go on.

“If the tax sunsets, all of a sudden everyone’s property taxes would jump up 22 percent. We don’t want to do that.”

Andover also has long list of capital improvement projects that require long-term planning, Lawrence said.

The sales tax would address those needs, including a larger shop to house its street maintenance equipment. Cost of that building is projected to be $3 million, he said.

“If we use $1 million each year for those $13 million in projects, that takes 13 years,” Lawrence added. “It doesn’t make sense to sunset it.

“Thirteen years ago we didn’t have this list. So I imagine 13 years from now, when we get done with this list, we’re going to have another list.”

If a sunset were in place, the city would have to incur debt to pay for the projects, he added.

Andover’s population of 12,000 has more than doubled over the past 10 years, Lawrence said, “So our sales tax collection have steadily increased.”

A three-year, 1-cent sales tax used to help build a new city hall, which was completed two years ago, ended 14 months early, Lawrence said.

Increased sales tax collections also are expected to cut short Butler County’s quarter-cent tax that began in 2010 to pay for $14 million worth of emergency communication equipment, county administrator Will Johnson said. Based on the current collection pace, the tax could end a year or two ahead of the scheduled stop date in 2020, he said.

Future Andover City Councils couldn’t repeal the city sales taxes themselves, Lawrence said, but they could vote to put another question on the ballot for voters to decide.

One-cent sales tax questions are on the Nov. 4 ballot for several area cities, including one for five years for Wichita. Bel Aire and Valley Center also have proposed one on their ballots.

Lawrence said state funding cuts have caused cities to resort to sales taxes to fund projects.

“The state has been chipping away at the revenues we used to receive,” he aid. “I think they’ll continue to do that because they’re not in a very good financial position themselves.”

Andover has held two public meetings to discuss the proposed tax and two more are planned: 6 p.m. Oct. 16, during an open house at the Street Shop, 1606 N. Andover Road; and 7 p.m. Oct. 29, Andover Central High School auditorium.

This story was originally published October 2, 2014 at 11:57 AM with the headline "Andover voters to decide on adding another 1-cent sales tax."