Town and Country, a suburb of St. Louis with a slightly pretentious name, is making a mockery of the Hancock Amendment. The city has imposed a 23-cent property tax increase (from zero to 23 cents), and is doing so without a vote of the people.
Is this legal? Perhaps.
Is this wrong? Absolutely.
The Hancock Amendment clearly states that new taxes and tax increases have to be approved by voters. Here is Section 22(A) of the state constitution (emphasis added throughout):
Section 22. (a) Counties and other political subdivisions are hereby prohibited from levying any tax, license or fees, not authorized by law, charter or self-enforcing provisions of the constitution when this section is adopted or from increasing the current levy of an existing tax, license or fees, above that current levy authorized by law or charter when this section is adopted without the approval of the required majority of the qualified voters of that county or other political subdivision voting thereon.
However, there are a few exceptions. The one the city seems to be relying on here is in RSMO 137.073.5, which states that a city that has previously voluntarily lowered its property tax rate below the legal ceiling may raise it up to that ceiling without a vote of the people.
However, the state auditor’s annual report on property taxes (page 4) explains how this works:
Sections 137.073.5(3) and 137.073.5(4), RSMo, provide that a voluntary reduction taken in a non-reassessment year (even numbered year) results in a reduced tax rate ceiling during the following reassessment year (odd numbered year). These provisions also allow taxing authorities that voluntarily reduce a tax rate in a previous even numbered year to reverse the impact of the voluntary reduction to reinstate a higher tax rate ceiling in the following even numbered year. To increase the tax rate in the following even numbered year, the taxing authority must conduct a public hearing, and adopt an ordinance, a resolution, or a policy statement justifying its action before setting and certifying its tax rate.
That explanation makes clear that the laws above are intended for reductions and increases that occur in subsequent years. The idea that Town and Country could reduce its property tax rate to zero and then increase it 27 years later without a vote of the people is, frankly, absurd. It’s a total violation of the spirit of the Hancock Amendment.
While this may not be a violation of the law, it is appalling. The residents of Town and Country have every right to be angry that they are being denied their right to vote by the city. Furthermore, if it is legal (and I am hoping someone challenges it in court) this loophole needs to be addressed by the state legislature. A city or county should not be able to set a tax rate for 27 years at zero and then just raise it because two generations ago voters approved a higher rate the city just hasn’t used.
This sort of chicanery is an example of local government at its worst.
