St. Louis, Missouri Comprehensive Revenue Study 2009, by the PFM Group

8/7/2019 St. Louis, Missouri Comprehensive Revenue Study 2009, by the PFM Group

http://slidepdf.com/reader/full/st-louis-missouri-comprehensive-revenue-study-2009-by-the-pfm-group 1/349

St. Louis, Missouri

Comprehensive Revenue Study

July 31, 2009

The PFM Group



p

Table of Contents

PAGE NUMBER

Executive Summary .................................................................. 4

Introduction and Project Background ....................................... 14

Revenue Structure ................................................................... 23

Tax Policy ................................................................................ 46

Other Non Tax Revenues ...................................................... 117

Fees, Fines & User Charges .................................................. 136

Tax Collection ........................................................................ 157

Tax Incentives ........................................................................ 178



Executive Summary



Executive Summary

The City of St. Louis is the center of the largest metropolitan area in Missouri, the 18 th largest inthe country. While St. Louis’ population has declined by over 50 percent since 1960, the City’s

population growth this decade is slightly higher than a majority of the study’s comparable cities.St. Louis generally has below average wealth and educational attainment statistics and aboveaverage levels of poverty, unemployment, and crime. The following discusses key topics for theCity.

City Strengths

The City is a regional center with a diverse economy and tax base. The City has madeinvestments in its urban core that have played a role in the re-urbanization trend that has

appeared in St. Louis and elsewhere across the country. The City has shown progress inemployment and wage growth.

City ChallengesThe City has to navigate stagnant to declining revenues and increased demand for services.Despite the more recent gains in employment and wages, St. Louis has experienced a long-termdecline as the City’s proportion of personal income and metropolitan area jobs have fallensignificantly. While comparable cities identified in the report experienced a similar decline inpersonal income, St. Louis’ decline has been the largest.

City Revenue Structure and Growth Rates

St. Louis relies on a mix of revenue. The largest source of City revenues is the earnings tax,which makes up 31 percent of general fund revenue. Combined with the earnings tax, franchise,property, and sales tax revenues comprise 65 percent of City General Fund revenues.

Recent and longer-term revenue growth has been below the general rate of inflation. Severalmajor categories, including sales tax, payroll expense tax, franchise taxes, and departmentalrevenues, have exhibited even less growth.

Evaluation of Strengths and Weaknesses of St Louis’ Revenue Structure



Executive Summary

Future Outlook for St. Louis Revenue

There are long-term revenue factors that have negatively impacted city budgets for a number of years. Absent changes in city revenue structures, they should be expected to continue. First, thenation as a whole is getting older. Older consumers spend less of their income on taxable goods,which is a reasonable predictor of overall government revenue collections. Cities also tend tohave lower household incomes than their suburban counterparts. On a per capita basis, higherincome households provide a much larger share of overall sales tax collections than otherhouseholds. Further, over the last fifty years, personal consumption has shifted from goods toservices, which are often not subject to the sales tax. Consumers are also shifting their purchases

to catalog, Internet, and other e-commerce transactions, which have lower percentages of actualsales tax collection. Combined, these trends help to explain why sales tax revenue, as a share of personal income, has been declining nationally over the last 50 years and why St. Louis has seenits sales tax revenue increase by a combined total of only 3.8 percent since FY1998.

Long-term Budget Outlook

Currently, the City is estimated to face a $31.4 million structural budget gap in FY2011. Thisgap would widen to a total of $215.7 million over the FY2011-FY2015 period.

Comparison of Revenue Structures & Tax Rates

($31,432,791) ($37,367,696) ($45,013,781) ($48,810,221) ($53,146,897)

($14,922,207)

($52,289,903)

($97,303,684)

($146,113,904)

($199,260,802)(250,000,000)

(200,000,000)

(150,000,000)

(100,000,000)

(50,000,000)

0

2011 2012 2013 2014 2015

Dollars ($000)

FY Surplus/ (Deficit)

FY EndingFund

Balance



Executive Summary

diverging opinions on what constitutes good tax policy, and in many instances, politics and self-interest enter into the discussion.

Various resources examine the issues surrounding taxation in a relatively neutral fashion. Whilethere is some variation in the terminology, there are some clear principles that emerge wherethere is close to complete agreement. These principles suggest the system should:

1. Minimize interference by taxes in market decisions2. Be reliable, stable, and sufficient3. Be simple, allow for compliance, and easy administration

4. Be equitable5. Have a balanced variety of sources/broad base

Evaluation of St. Louis’ Revenue StructureThe primary competitive disadvantage the City faces is the impact of its earnings tax. Theearnings tax allows the City to capture revenue from those who work in the City but do not livein the City; however, the City’s dependence on the earnings tax revenue is a cause for concern.Nearly 40 percent of the City’s General Fund revenues are generated by income based taxes,which is well above the average for cities with income-based taxes.

Some revenue best practices sources suggest that local government should seek to derive nomore than $1.50 in income tax revenue for every $1.00 in property tax revenue. In FY2010, St.Louis is projecting to generate over $2.70 in earnings tax revenue for each dollar in property taxrevenue.

Research suggests that the earnings tax can be an impediment to attracting new jobs and

investment in the City. The long-term declines in personal income and jobs as a percentage of the metropolitan area may be a factor of the City’s earnings tax. Other cities across the countryhave experienced the economic impact of an uncompetitive earnings tax. A primary example isthe City of Philadelphia where incremental reductions in its earnings tax over time have been



Executive Summary

10. Increase Use of Service Charges

11. Explore Methods to Leverage City Water Division to Generate Additional Revenue

12. Restructure the City’s Graduated Business License Tax13. Raise Property Tax Millage Rate 14. Shift to a Land Value or Split-Rate Property Tax System 15. Begin a Program of Incremental Reductions to the City’s Earning Tax

16. Explore Changes to the City’s Existing Payroll Expense Tax

A reduction in the earnings tax as part of a package of other revenue options will also help theCity realign its revenue structure to foster growth in its tax base and be more competitive with

the metropolitan region. This approach would signal to the business community and potentialresidents that the City is serious about making itself a more competitive and attractive place tolive and work.

Non-Tax Revenue Across the nation, citizens and voters have exhibited increased resistance to broad-based taxesand fees. As a result, governments have sought other opportunities to raise revenue beyondtaxes, licenses, or charges for services. This study discusses two specific revenue options withpotential to raise additional non-tax revenue, payments in lieu of taxes and market-based revenueopportunities.

Payments in lieu of taxes (PILOTs) are payments to a local government from entities that arenormally exempt from other taxes, particularly property taxes. They are most commonly madeby not-for-profit (NFP) organizations such as universities, hospitals, foundations and publicly-owned utilities. The NFP organizations operating within the City own 22 percent of the City’s

assessed value of property. Among comparable cities that report tax exempt property value, St.Louis has a relatively high proportion of total property value owned by tax exempt entities.

Cities across the nation have developed methods to recover lost property tax revenue from



Executive Summary

tax revenue. In St. Louis, increases to fees, fines, and user charges are restricted by the Hancock Amendment. Together, these revenues accounted for approximately 12 percent of FY2008

General Fund revenues.

Currently, the City of St. Louis does not publish a consolidated fee schedule listing each of itsfees, fines, and user charges. On a smaller scale, many departments do not keep a list of fees,fines, and user charges. While some departments regularly reevaluate their fee levels, many Cityfees and charges have not been reassessed in over a decade.

Recommendations/Options

1. Increase User Fees to Recover More of the Cost of Service 2. Increase Fees for Construction Permits 3. Develop and Implement a User Fee Policy 4. Examine Options to Update or Modernize its IT Systems Related to User Fees 5. Consider Generating Additional Revenue from New User Based Charges

Tax CollectionDue to its status as an independent city, St. Louis has a unique tax collection structure. While

staffing and organization can be important aspects of revenue collection procedures andpractices, it is not within the scope of this study. Briefly stated, the responsibility for taxcollection in St. Louis is highly decentralized amongst several city departments.

Delinquent Tax and Fee CollectionDelinquent tax and fee collection is a key function of any city tax collection agency. Enforcingdelinquent accounts sends a strong message to taxpayers who timely file as well as those who do

not that delinquent or non-payment of tax liabilities will be met with a decisive city response.Cities across the country have utilized multiple methods to deal with delinquent accounts:

Prioritization of Cases



Executive Summary

o Tracking of Delinquent Case Resolutiono Intergovernmental Cooperation

Evaluation of St. Louis’ Tax Collection SystemAs noted above, authority for tax collection in St. Louis is highly fragmented. The City needs tocentralize tax collection functions, policies, procedures, and methods to achieve higher collectionrates and more efficient tax administration. The following are key areas for additional effort:

Online Payment Options Lack of Single-Site City Payment Centers

Lack of Centralized IT Platform Collection of Past Due Receivables and Taxes Lack of Standardized Accounts Receivable and Revenue Collection Policies


Provide Additional and Improve Existing Online Payment Options Set up City Payment Centers

Create a Centralized and Sharable IT Platform for Tax Collection Explore Alternative Methods of Past Due Receivable and Tax Collection Establish Standard Accounts Receivable and Revenue Collection Policies

Make Greater Use of Performance Evaluation in Tax Collection Make Greater Efforts at Intergovernmental Cooperation on Tax Collection

Tax IncentivesAs with most large cities, St. Louis utilizes various tax and other incentives to foster economic

development. This can have multiple effects on the City’s revenue structure – both positive andnegative. The actual need for economic development tax incentives has been a matter of extensive discussion and debate. While this debate is likely to continue, in practice, nearly everylarge city utilizes tax and other incentives for economic and community development



Executive Summary

Overview of TIF UtilizationSt. Louis has made heavy use of TIF to redevelop derelict and abandoned properties, mostly

within or close to the downtown core. The City has had success in redeveloping properties intoprofitable developments, particularly in downtown and adjacent areas. The City has used TIFs toattract new businesses downtown, in many instances to compensate for the effects of theearnings tax. Many of these targets have been small to medium sized businesses that highlyvalue a downtown location; downtown currently lacks an abundance of large corporate tenants.

In recent years, the City has reduced its financial commitment to TIF projects, from $7.5 millionin FY2008, to a projected $2.9 million in FY2010.

Comparative Analysis of TIF Policies

In general, St. Louis’ TIF policies are similar to those of comparable cities. Each city requires“but for” tests, cost benefit analyses, and targets the use of TIF to blighted areas. However, St.Louis and Kansas City maintain a broader array of eligible uses, allowing TIF for general areasthat are targeted for economic development.

In general, pay-as-you-go systems are regarded as the safest financing methods for TIFs, as

expenditures are closely related to the incremental tax revenue generated from the district.

Comparative Analysis of TIF Performance

In comparison to other benchmark cities, St. Louis’ has been relatively conservative in the use of tax increment financing. The City’s number of active TIF projects is roughly on par withcomparable cities, and average PILOT revenue per project, although much lower than KansasCity, is in the mid range.

Local redevelopment agencies often seek near-term private investment ratios to public dollarparticipation at 8 to 1, ranging up to 12 to 1. St. Louis’ average ratio is 6.4 to 1, well below thisrange; however, it is slightly higher than Baltimore and Kansas City.



Executive Summary

Evaluation of TIF ProgramSt. Louis’ use of TIF has been driven by its need to redevelop older, vacant properties into more

profitable developments. The City has been successful in catalyzing developments that have ledto above average increases in City job and wage growth. However, in the process, whether theseprojects actually achieve City development goals and produce satisfactory financial results hasnot been actively considered.

The City also maintains very broad standards for the use of TIF funds. In St. Louis, TIF fundingis restricted to uses specified in the state TIF Act, which lists a very wide array of eligible uses.Currently, City TIF policy expresses a preference for public infrastructure expenditures. Beyond

these, there are no meaningful requirements for the appropriate use of TIF funds.


1. Regular Reporting and Evaluation of TIF Performance

2. Align Projects with Specific Development Goals

3. Undertake More Rigorous Cost Benefit Analyses

4. Restrict Use of TIF Funds

5. Solicit Community and Stakeholder Buy-in and Feedback

6. Consider Use of Pay-as-you-go Financing7. Establish TIF Property Assessment Value Limits

8. Consider New Methods to Recoup City Costs

Tax AbatementTax abatement is another incentive commonly employed by the City as an economicdevelopment tool. In St. Louis, tax abatements freeze the tax assessment of new improvementsat the pre-development level. By statute, tax abatements can last up to 25 years, with the first 10years eligible for full abatement and the remaining 15 years eligible for 50 percent abatement.Those greater than 10 years are required to show extraordinary cost, development obstacles, orextraordinary impact.



Executive Summary

Overview of UseTax abatement in St. Louis has largely been determined by whether areas are able to receive

designation as a redevelopment area. Since tax abatement is open to any residential,commercial, or industrial project in redevelopment areas, a large number of projects have beeneligible for financing.

Comparative Analysis of Tax Abatement PoliciesAs in other comparable cities, St. Louis limits development property tax abatements to 10 years,with the option of an extension. In addition, the City targets tax abatements to Enterprise Zonesbut is unique in allowing abatements for any Board of Aldermen-approved property. St. Louis

and Baltimore do not require a cost benefit analysis for approval of tax abatement; Kansas Cityand Minneapolis maintain this requirement. While St. Louis and Kansas City require jobcreation reporting for commercial projects, they are the only cities that do not have a job creationcriterion for tax abatement applications.

In St. Louis, tax abatement is possible on the added value from property improvements (similarto TIF). Other cities abate fixed percentages of total property tax liability or adjust theabatement in line with the fulfillment of job creation and new investment criteria.

Tax Abatement Evaluation

In St. Louis, it has generally not been difficult to secure tax abatement. The City’s criteria arebroad enough to include a variety of developments that may or may not align with the City’seconomic development goals. In addition, the approval of tax abatement is heavily influenced bythe Alderman of the ward where the development is located, who often can apply specialconditions or unrelated demands on the development as a condition of support.

Currently there are no guidelines or restrictions on the percentage of property assessed valuationthat can be subject to tax abatement. In 2007, 15.7 percent of the City’s assessed property valuewas subject to some sort of real estate tax abatement, accounting for a very significant portion of the City’s property tax base



Introduction and Project Background




St. Louis, Missouri is the heart of a bi-state metropolitan region home to over 2.8 million people.Many national and regional assets are located within the City, including the Gateway Arch,

professional sports franchises, St. Louis and Washington Universities, and Forest Park. Citygovernment has, over the years, maintained reasonable fiscal discipline, which is evidenced byits credit ratings by national credit ratings firms: A+ from Standard and Poor’s, A from FitchRatings, and A2 from Moody’s Investor Services. At the same time, the City has struggled tomaintain regular revenue growth needed to provide city and county services for an urbanpopulation with below average income levels and above average crime rates, while alsorevitalizing its downtown and core city neighborhoods.

At present, the national economic downturn has severely impacted local governments across thecountry and St. Louis is no exception. City leadership has been able to navigate the currenttroubles by taking steps to control personnel costs while seeking to preserve essential services.However, the City’s long term financial position is threatened by a revenue structure that is notproviding the levels of growth generally necessary to sustain and support critical services orfoster economic growth.

To assist the City in understanding how its revenue structure and policies impact city growth and

services, the Missouri Council for a Better Economy (MCBE), a 501(c)(3) organization, engagedPublic Financial Management (PFM) to conduct a comprehensive revenue study. The primarygoal of this study is to better inform the City and its stakeholders of opportunities to strengthenand stabilize the City’s long-term revenue base and improve overall economic performance byevaluating the current and potential revenue “future state” in four areas:

1. Tax Structure and Tax Policy2. Non-Tax Revenue Generation3. Tax and Revenue Collection Processes4. Tax Incentives for Economic Development




assistance from other City stakeholders, including elected officials and their staff. Theirwillingness to provide information, commentary, time for interviews, and answer follow up

questions is notable and has been critical to the successful completion of this study.

Project Approach

In planning and developing this study, the PFM project team used a variety of quantitative andqualitative methods to examine the City’s revenue structure from multiple perspectives. Whendoing quantitative analysis, PFM regularly constructs Excel-based models to help project currentand future City financial outcomes. For this project, PFM created two models:

A long-range financial model that incorporates historical City revenue and expendituredata and future fiscal year forecasts to project the City’s budget position for FY2011-FY2015. The model helps predict the projected long-term growth of the current revenuestructure compared to projected expenditures. The model can also simulate the fiscalimpact of possible changes to the City’s revenue structure.

A property tax model containing current City Assessor data on City land parcels and thebreakdown of property tax by classes of property (commercial, residential, and tax

exempt). The model also provides a detailed breakdown of the share of property taxattributable to land and that attributable to structures and other improvements to theproperty. The model assists in discussions of the share of property within the City that isnot subject to property tax, as well as possible impacts from changes to how land andproperty are taxed.

To provide additional context, PFM identified nine comparable cities for benchmarking on abroad range of financial, economic, and demographic information. This provided a base foranalysis of variations in tax structure, tax burden, and possible impacts on city economies anddevelopment. PFM also conducted best practices research based on our past experiencethroughout the country and analyzed the results of that research with current City practices.




After interviewing City leadership, the project team worked with the Budget Director to

understand and refine General Fund revenue and expenditure assumptions. Over the course of the project, the team also met with various City departments and elected officials to obtain theirinput on current revenue structure as it pertained to their areas of responsibility. In addition,meetings were held with other key stakeholders – including the St. Louis Regional Chamber andGrowth Association, the Regional Business Council, Civic Progress, the Partnership forDowntown St. Louis, and the St. Louis Development Corporation – to gain further insight intothe perspectives of these stakeholder groups. A complete listing of the individuals and groupsthe project team met with can be found in Appendix A.

Benchmarking and Best Practices

The project team identified and compiled comparative benchmarks for St. Louis’ economic,financial, and demographic characteristics. For some issues, supplemental surveys wereconducted to build on existing database resources. Although no two benchmark cities are everperfect twins, comparisons can be helpful both as a diagnostic tool to help identify relativestrengths and weaknesses, and to provide a sense of where other governments are using

innovative methods to generate additional revenue to support critical services. For this, PFMsought to identify cities with similar demographic, geographic, and economic features to St.Louis and/or close regional proximity, resulting in the following nine cities for primarybenchmarking analysis:

Baltimore, Maryland Norfolk, Virginia Kansas City, Missouri Omaha, Nebraska Knoxville, Tennessee Pittsburgh, Pennsylvania Louisville, Kentucky St. Charles, Missouri Minneapolis, Minnesota




For each of the comparable cities, PFM collected information on basic demographics, taxes, taxincentives, and in some areas, more specific departmental metrics.

In addition to benchmarking, this report builds on the project team’s review of an extensive listof best practices research, surveys, and reports. Reports and analyses from universities, think-tanks, commissions, governmental organizations such as the National League of Cities andUnited States Conference of Mayors were all reviewed and incorporated where applicable toprovide the City with the proper context to evaluate its current revenue structure and considerpossible changes.

It goes without saying that the underlying foundation for this report is the knowledge andexperience of the City’s own elected leaders and professional staff, supplemented by PFM’snational experience, peer city benchmarking, and best practice research. Based on thatknowledge and experience, during a collaborative, five-month process involving PFM and Cityelected officials, professional staff and other city stakeholders, the project team has:

Created a financial model that established the “as is” financial position of the City andprojects the impacts from changes to the baseline revenue and expenditure assumptions,including property tax structure over a multi-year period.

Developed a best practices database for use in analysis and review of key project topics,including financial policies and tax collection practices.

Compiled a matrix of revenue options that identifies opportunities to generate additionalrevenue across different categories, including charges for services, business taxes, andproperty taxes.

Incorporated context and analysis through benchmarks, metrics, and best practices. Provided a framework to examine the various options presented to assist City

stakeholders’ decision making process.

Upon project completion, PFM will also transfer the financial models to City staff. This shouldassist the City with integrating longer-range modeling into its budget and financial planning




vitality of its downtown core, which no doubt has contributed to the reversal of a decades-longpopulation decline.

Figure 1: St. Louis Population Trends

Source: U.S. Census Bureau

While St. Louis’ population has declined by over 50 percent since 1960, its population growththis decade is slightly higher than the majority of the study’s comparable cities. In addition, theCity has the third highest population density and is in the mid-range in terms of median residentage.

Table 1A: Geographic and Demographic Indicators

PopulationPopulation Land Area

PopulationDensity

MedianResident

750,026

622,236

452,801396,685

348,189354,361

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

1960 1970 1980 1990 2000 2008

P

o

p

u

l

a

t

i

o

n

YEAR




As shown in the following table, among the comparable cities, St. Louis generally has below

average wealth and educational attainment and above average levels of poverty, unemployment,and crime:

Table 1B: Economic and Demographic Indicators

MedianHomeValue

(2007)

MedianHousehold

Income

(2007)

IndividualPovertyLevel

(2007)

% of Populationwith Bachelor's

Degree or Higher

(2007)

UnemploymentRate

(March 2009)

Crime Index

(2008)St. Louis $128,300 $34,191 22.4% 24.9% 10.1% 1061.9

Kansas City $135,500 $42,123 17.4% 28.9% 10.9% 765.2

St. Charles $182,700 $56,034 7.4% 31.4% 9.9% 382.1

Baltimore $158,400 $36,949 20.0% 24.1% 9.9% 640.6

Knoxville $106,500 $34,185 20.7% 28.3% 12.1% 768.0

Louisville $135,600 $31,624 16.6% 24.2% 10.2% 535.6

Minneapolis $232,800 $44,423 20.4% 42.0% 7.4% 678.3

Norfolk $200,100 $40,701 17.1% 22.3% 8.2% 598.7

Omaha $126,600 $45,170 14.7% 30.8% 5.1% 490.4

Pittsburgh $84,500 $32,363 21.0% 32.0% 6.8% 516.0Source: U.S. Census Bureau, American Community Survey 2007.Note: St. Charles data is based on American Community Survey estimates from 2005-2007 and the city’s crime rate is from 2007.

City Strengths

St. Louis’ strengths are well documented by independent authorities, including municipal bond

rating agencies.1 The City is a regional center with a diverse economy and tax base. The regionis home to 21 Fortune 1000 companies, eight of which are in the Fortune 500.2 St. Louis is alsohome to a significant number of large public sector employers that can often be a stabilizingforce in the midst of an economic downturn The City’s financial management has also been




These investments have also shown progress for the City in terms of employment and wagegrowth. As of September of 2008, among the 17 largest counties in the greater St. Louis region,

the City of St. Louis ranked second in annual employment growth and fourth in average weeklywage growth over the past three years.

City Challenges

St. Louis must address several challenges to take advantage of some recent positivedevelopments. The most immediate challenge will be to effectively manage the impacts of thecurrent economic downturn. The City’s ability to navigate stagnant to declining revenues and

increased demand for services will require difficult decisions, as evidenced by the City’sproposed employee furlough program.

Aside from the economy, the City must address several long-term demographic trends. Despitethe more recent gains in employment and wages, St. Louis has experienced a long-term decline –over the past thirty-five years – as the City’s proportion of personal income and metropolitanarea jobs have fallen significantly. The following table details the City’s decline in personalincome as a share of metropolitan personal income (and the other comparable cities) since 1970:

Table 2: Percentage of Metropolitan Area Personal Income

% Change1970-20061970 1980 1990 2000 2006

St. Louis 21.9% 16.7% 13.2% 10.2% 9.6% -56.4%

Kansas City 39.3% 30.9% 25.4% 22.2% 19.8% -49.5%

Knoxville 33.8% 25.0% 20.9% 19.1% 16.8% -50.3%

Baltimore 39.9% 30.6% 25.3% 18.9% 18.1% -54.5%Louisville 27.9% 18.8% 15.8% 13.6% 29.7% 6.3%

Omaha 44.4% 35.6% 35.2% 35.0% 27.6% -37.8%

Norfolk 28 6% 21 5% 16 0% 13 2% 13 0% 54 6%




Figure 2: Percentage Change in Metropolitan Personal Income Since 1970

Given the decline in personal income, it is not surprising that St. Louis has seen a 60.8 percentreduction in its share of metropolitan employees over the same time period. Over time,employment patterns have become more decentralized, weakening the traditional downtownemployment base. This fact is complicated by the large number of municipalities in the St. Louisregion, which has at times led to competition between governments to expand their tax base,arguably to the detriment of the region as a whole. There has been a clear trend toward

migration out of the City to the outlying suburban areas in the region; this generally leads to ahigher unemployment rate and concentrated areas of poverty and crime within the City.

Of late, St. Louis has demonstrated some short term successes, but the longer term trends are

-56%

4%

225%

82%

65%

-14%

-18%

31%

11%

65%

109%

148%

-100% -50% 0% 50% 100% 150% 200% 250%

St. Louis City

St. Louis County, MO

St. Charles County, MO

Jefferson County, MO

Frankl in County, MO

Madison County, IL

St. Clair County, IL

Clin ton County, IL

Jersey County, IL

Monroe County, IL

Lincoln County, MO

Warren County, MO



Revenue Structure



Revenue Structure

As with most cities, St. Louis’ revenue structure has evolved over time and includes a variety of tax and non-tax revenues to support City services. This chapter will analyze:

The City’s current revenue structure Its revenue performance over time Positive and negative aspects of the current revenue structure Impact of current economic conditions on City revenues Its future revenue outlook

Current Revenue Structure

St. Louis relies on a diverse mix of revenue sources to provide the resources to fund currentoperations and services. The largest component of City revenues is the earnings tax, which ismore than twice the size of the next largest revenue source. Franchise, property, and sales taxrevenues are the City’s other major sources. When combined, these three sources total nearly 35percent of total General Fund revenues. Along with the earnings tax, these four sourcescomprise approximately 65 percent of City General Fund revenues.

The following pie chart details the estimated share of General Fund revenues by major category:

Figure 3: FY2010 Estimated General Fund Revenues

Earnings Tax; 31%Intergovernmental;

6%

Departmental; 9%

Employee PensionTrust; 3%



Revenue Structure

Yearly Growth Rates

Since 2006, General Fund revenues have grown at an average rate of 1.7 percent annually. Thisis similar to General Fund revenue growth over the past 10 years, which has averaged 1.5 percentannually. It should be noted that both of these rates are generally below the yearly average rateof inflation.

Over the past five years, the City has benefitted from regular growth in property tax revenues,intergovernmental sources, and convention and tourism tax revenues (hotel/motel andrestaurant). The City’s primary General Fund revenue source, the earnings tax, also grew by an

average of 1.7 percent annually. Other major categories, including sales tax, payroll expense tax,franchise taxes, and departmental revenues have exhibited less growth.

The following table details this historic performance:

Table 3: Tax Revenue Growth

Negative to Flat Growth Flat to 2% Annual Growth 2% or Greater Annual Growth

Amusement Tax Sales Tax Property Tax

Parking Tax Earnings Tax Intergovernmental Revenues

Licenses Payroll Expense Tax Hotel/Motel Tax

Departmental Revenue Franchise/Utility Taxes Restaurant Tax

It is notable that some of the intergovernmental revenue sources subject to state appropriationsthat exhibited strong growth (i.e. Prisoner Housing Reimbursement) have failed to keep pacewith the cost of service. As a result, they have had a net negative impact on the City’s financialcondition.

St. Louis Revenue Sources



Revenue Structure

Table 4: General Fund Revenues FY2006-FY2010

Revenue Category

FY2006Actual

FY2007Actual

FY2008Actual

FY2009Projected

FY2010Budgeted

Avg. Annual

% Change2006-2010

Taxes:

Earnings Tax 131,735,560 136,433,476 141,404,681 141,225,000 141,225,000 1.7% Sales Taxes 47,346,639 48,759,269 49,060,636 48,108,000 48,108,000 0.4% Property Tax 44,590,572 48,292,457 52,182,915 51,518,000 52,281,000 4.0% Payroll Expense Tax 36,280,566 34,857,007 36,960,559 36,912,000 36,912,000 0.4% Sports and Amusement 8,019,310 3,413,518 3,651,018 3,695,500 3,743,500 -12.1% Parking Garages and Lots 2,501,800 2,462,932 2,366,627 2,249,000 2,268,000 -2.4%Subtotal: 270,474,447 274,218,659 285,626,436 283,707,500 284,537,500 1.2%

Franchise / Utility Taxes:Electricity 22,589,626 22,603,973 23,517,484 23,000,000 24,780,000 2.4%

Natural Gas 11,693,773 11,367,239 11,112,921 11,903,000 11,900,000 0.5% Telephone 8,229,350 7,864,858 12,151,676 15,873,000 7,320,000 1.9% Water 4,054,338 4,107,896 4,174,856 4,650,000 5,100,000 6.0% Airport 5,325,580 5,566,475 6,081,190 6,203,000 6,110,000 3.4% All Other franchise fees 958,335 945,067 1,114,113 1,005,000 1,030,000 1.6%

Subtotal: 52,851,002 52,455,508 58,152,240 62,634,000 56,240,000 1.6%

Intergovernmental Revenues:

Gasoline Tax 9,952,657 10,053,775 10,102,934 9,650,000 9,650,000 -0.7%

Health Care Payments 3,699,070 3,737,940 3,760,535 5,200,000 5,500,000 11.4% Prisoner Housing Reimbursement 3,955,258 8,680,576 7,071,542 4,580,475 6,330,000 24.9% Juvenile Detention Reimbursements 2,499,490 2,435,836 2,335,005 2,279,500 2,277,500 -2.3% Motor Vehicle Sales Tax 3,573,545 4,060,390 3,103,595 2,660,000 2,700,000 -7.5% Intangible Tax 56,673 177,536 104,062 630,000 250,000 146.9%Subtotal: 23,736,693 29,146,053 26,477,673 24,999,975 26,707,500 3.5% Licenses:

Graduated Business License 8,077,692 7,702,076 7,936,195 7,750,000 7,750,000 -1.0% Cigarette Occupational License 2,005,991 1,867,600 1,866,507 1,848,400 1,820,400 -2.4% Automobile 1,345,872 1,349,445 1,394,217 1,351,000 1,351,000 0.1% Other Licenses

777,882 1,301,944 769,380 1,027,905 1,034,875 8.1%Subtotal: 12,207,437 12,221,065 11,966,299 11,977,305 11,956,275 -0.5%

Departmental Revenues:

Fines and Forfeits 6,196,970 6,918,735 8,442,263 8,412,000 8,122,000 6.5% Building and Occupancy Permits 8,443,766 7,829,749 6,674,267 7,796,800 8,062,800 -1.1%



Revenue Structure

Earnings Tax

0.0 Percent Projected Growth in FY2010

FY2010 Revenue $141,225,000

% of Total Revenue 31.1%

The earnings tax is a one percent tax levied against gross employee compensation of individualswho live in or work in the City. It is also levied against the net profits of businesses operating inthe City. Receipts from individuals account for 85 percent of the earning tax revenues, with

businesses accounting for the remaining 15 percent. Earnings tax revenues tend to be tied thestate of the City’s economy. Historically, the earnings tax has grown by slightly more than 2.5percent annually. Recently, job losses and declining corporate earnings have taken their toll.This revenue stream is not projected to produce additional revenue in FY2010.

Franchise/Utility Taxes

Declines by a Projected 10.2% in FY2010

FY2010 Revenue $56,240,000


Franchise taxes are assessed on the gross receipts of utility companies, including electric, naturalgas, telephone, water, steam, airport, and other franchises operating in the City. Revenue growthis largely due to rate increases. For example, electric utility receipts make up the largestpercentage of this revenue category and are expected to increase in FY2010 due to a rate

increase.

St. Louis has recently received significant one-time settlement payments as a result of changes toh l i i f hi I N b 2007 h Ci d d i f 10



Revenue Structure

Property Taxes

Grows by a Projected 1.5% in FY2010

FY2010 Revenue $52,281,000


Property taxes are assessed on both real and personal property, with real property tax revenuesaccounting for roughly 80 percent of total property tax revenues. Real property is assessed everytwo years, in accordance with Missouri statute. Personal property tax is assessed annually on

automobiles, boats, planes, and business personal property. The following table details theproperty tax levy by governmental entity within the City:

Table 5: St. Louis Property Taxes – FY2010

LevyMillage per $1,000 ofAssessed Value

State 0.300

Schools 38.028

Community College 2.013

Library 4.938

Zoo, Museum, Garden District 2.344

Sewer District 0.000

Sheltered Workshop 1.295

Community Mental Health 0.777

Community Children's Service Fund 1.775

City - General Purposes 12.276

City - Public Debt 0.949

TOTAL 64.695



Revenue Structure

St. Louis experienced strong property value growth this decade, but it was largely a product of rehabilitated and redeveloped areas, not the widespread speculation that occurred in Florida,

California, and parts of the Southwest. In fact, the State of Missouri was one of only ten states toexperience positive growth in home prices over the 12 months through January 2009.8 Nonetheless, there is the potential of revenue losses in real and personal property taxes due todeclining property values, increased difficulties in collection, and other factors.

Sales Tax


FY2010 Revenue $48,108,000


The City’s portion of the sales tax that is dedicated to the General Fund is 1.375 percent.However, the total basic sales tax rate in the City (not including any business or communityimprovement districts) is 8.241 percent. The following details the breakdown by purpose:

Table 6: St. Louis Sales Tax Breakdown

Sales Tax Percentage

City - General Purposes 1.375%

City - Capital 0.500%

City - Metro 0.750%

City - Regional Parks 0.100%

City - Local Parks 0.125%

City - Public Safety 0.500%Total City Portion 3.350%

Missouri State Rate 4 225%



Revenue Structure

improves. As will be discussed later, there are a variety of factors that are combining to limitsales tax revenue growth in St. Louis and in cities and states around the country. Absent changes

to the current system, it is likely that even improved economic performance will not lead torobust growth in sales tax revenues.

Departmental Revenues


FY2010 Revenue $40,590,180


Departmental revenues include fines and forfeits generated by the courts, as well as permit feesand charges for services from other City departments. Revenues from departmental sources areheavily dependent on court fines and building permits, which generate approximately 40 percentof revenues within this category.

Overall departmental revenues have tended to fluctuate over time. Recently, red-light camera

enforcement and aggressive collection of past receivables have driven fines and forfeitscollections significantly higher; however, it appears that motorists are becoming more aware of the cameras and have begun to change their habits. As a result, red-light camera revenues areexpected to decline in the coming year.

Departmental revenues are projected to show a healthy increase in FY2010. However, eventaking this increase into account, they will still be lower than in FY2006 by approximately $3.5million. Increases in this revenue stream are dependent on the strength of the economy

(particularly housing and new construction, which drive demand for building permits) andpossible rate adjustments. Charges for services have been an increased area of focus formunicipal governments nationwide, and 28 percent of city finance officers recently reportedi i th i it ’ l l f f d h 10



Revenue Structure

based on economic conditions. For instance, prior to the 2001-2002 recession, this revenuestream had experienced growth of 6.6 and 10.4 percent before declining by nearly 10.0 percent in

FY2003.

Intergovernmental Revenues


FY2010 Revenue $26,707,500


Intergovernmental revenues are reimbursements from, or revenue sharing with, the State of Missouri. This source has been the City’s most inconsistent revenue stream. Since FY2004,intergovernmental revenues have alternated between increases and decreases every other yearwith only FY2008 and FY2009 showing a consecutive pattern (two consecutive decreases).

The principal source of intergovernmental revenue is the gasoline tax, which is a share of thestate gasoline tax that is remitted to Missouri cities based on their share of population. Other

sources include health care payments, prisoner housing reimbursements, and the City’s portionof the motor vehicle sales tax. Revenue growth is largely dependent on population growth,automobile sales, inmate populations, and state policy choices.

Convention and Tourism Taxes


FY2010 Revenue $12,938,000


This category includes the hotel/motel sales tax and the restaurant gross receipts tax The



Revenue Structure

Licenses

A Projected 0.2 Percent Decline in FY2010

FY2010 Revenue $11,956,275


The City receives 65 percent of its license revenue from the graduated business license. Thegraduated business license is an increasing rate based on the number of employees a businessemploys. St. Louis voters approved a revised rate schedule in 2006 with incremental additional

revenues allocated to a Public Safety Trust Fund. Revenue growth in this category is dependenton rate increases, business growth, and efficient license administration.

Other Revenue Sources

Table 7: Other Revenue Sources

Revenue Source Description

Sports andAmusement Taxes

Amusement tax receipts are generated by a five percent tax on the grossreceipts of NFL football, NHL hockey and other sporting and amusement ticketsthroughout the City. The St. Louis Cardinals are exempted from the tax due toprivate investments made at the new Busch Stadium. The St. Louis Blues willbe exempt once the Kiel Opera House financing is complete.

12

The amusement tax is projected to produce $3.7 million in revenue in FY2010.Amusement revenue has increased marginally over the past several fiscal yearsand is limited by the number of events and the ticket prices charged.

Parking Garagesand Lots

Parking revenue is derived from a five percent tax on the gross receipts ofpublic and private parking garages throughout St. Louis. Parking revenueshave been slowly declining since FY2006 and are projected to generate $2.3million in FY2010. Revenues from parking are contingent on the City’s ability to





Revenue Structure

Figure 4B: Municipal Fiscal Capacity

St. Louis generates approximately 73.8 percent of its revenue locally through earnings, property,sales, payroll expense, and utility taxes. A common best practice is for cities to generate most of their revenue locally. Frequently, large cities will receive less intergovernmental support than

smaller municipalities, in part due to their enhanced authority to generate local revenue.

3. The existence of tax and expenditure limits (TELs) constrain local fiscal autonomy by

limiting the local government’s flexibility to tax or spend according to state statute.

TELs are state or voter imposed tax and expenditure limitations. There are two significant types,those that limit or restrict property tax increases, and those that limit overall spending increases.Three types of property tax limits exist:

1. Those that seek to cap the property tax rate.

2. Those that seek to limit growth in local property assessments.



Revenue Structure

Figure 4C: Municipal Tax and Spending Limits

Due to the Hancock Amendment, the City has a binding property tax limit, which places a cap onCity property tax levies.

The preceding data from NLC illustrates how cities are heavily influenced by state policychoices. However, local governments also have the ability to create a sustainable revenuestructure by making adjustments that will produce a more resilient local economy. Thefollowing have been cited as useful strategies as for a City seeking to improve its revenuestructure: 14

Develop a Strategic Plan that objectively assesses the impact of local taxes and fees onthe economy;

Avoid Tax Favors that significantly interfere with the market. A well articulated planthat details when and how tax incentives are used is critical;

Diversify the Tax Base through the use of several broad-based tax sources;



Revenue Structure

The City has a blend of income, property, sales, and utility tax revenue. This places theCity ahead of many municipalities nationwide who are dependent on one or even two

broad-based tax sources. St. Louis’ blend of four primary revenue sources keeps the tax base relatively diversified

in line with documented best practices. The City’s economy is well diversified, with five primary sectors—education and health

services, professional and business services, trade, transportation and utilities, leisure andhospitality, and manufacturing—each making up at least 10 percent of the City’semployment base.15 The lack of a significant concentration of employment in oneparticular industry has helped the City weather the current economic slowdown better

than other cities across the country. While many metropolitan areas struggle to demonstrate cooperative regional efforts and

funding mechanisms, the St. Louis region funds the Metropolitan Zoological Park andMuseum District, regional parks, and the Bi-State Development Agency (Metro transit)to preserve metropolitan area assets. In addition, the City’s earnings tax allows it toderive revenue from commuters to offset the costs of infrastructure, public safety, andother city services.

These strengths are in some ways offset by other factors:

While the City has a diverse mix of broad-based revenue sources, it is heavily reliant onthe earnings tax. St. Louis generates more than twice as much revenue from the earningstax than it does from any other revenue stream. It is generally observed that overrelianceon any particular revenue source will magnify its weaknesses, and the earnings tax is nodifferent. The earnings tax is also sensitive to economic downturns, including the currentrecession. This can put the City in a difficult financial position when the economy is

weak. The City is constrained by the Hancock Amendment (Hancock). Hancock requires voter

approval before any political subdivision in Missouri can levy any “tax, license, or fee”



Revenue Structure

The U.S. Government Accountability Office (GAO) has developed a model that simulates theentire state and local government sector. The model shows a significant emerging fiscal gap

over the next ten years. The causes are primarily revenues not growing as a percentage of GDPand fast growing health care costs. In November 2008, GAO estimated a combined $100-200billion gap for 2009-2010; by January 2009 the gap had risen to $312 billion, which illustratesthe rapid deterioration in the state and local government sector.

18

The following figure shows the City’s FY2010 initial budget gap compared to other major citiesaround the country. While the St. Louis gap was significant, it was on the lower end of thesurveyed cities:

Figure 5: City Budget Gaps Nationwide

City Budget Gap

Detroit 300,000,000

Columbus 114,000,000

Phoenix 201,000,000

Kansas City 87,100,000

Chicago 769,000,000

Los Angeles 528,720,000

New York 6,600,000,000

Philadelphia 428,000,000

Atlanta 56,000,000

St. Louis 30,000,000

Boston 140,000,000

Gap as a Percentage of General Fund

6%

7%

10%

11%

11%

12%

13%

15%

17%

18%

20%



tax revelag the o

2008 wilthree recfollowin

As withunemploconsumesales an

ue fell by 5verall econ

l be felt byessions, recthe end of

Figure 6:

its peers,yment increr spendingd payroll

.1 percent imy, thus d

ities througipts have tthe recessio

Recession

the Cityased fromas declinedxpense tax

the first qteriorating

h 2009 andailed expenn. The foll

s and Stat

as been i.3 percent

. Economis have all

arter of 20conomic c

likely throuditures andwing figure

and Local

mpacted bin April 20ally sensitiweakened

9.21

Localnditions se

h most of continued tdetails this

Receipts a

the decli08 to 10.1e revenuefrom previ

R

governmentn during th

010. In eaco do so fortrend:

nd Expend

e in thepercent intreams sucous estimat

venue Stru

finances tefinal mont

h of the preone to two

itures

economy.arch 2009as the ear

es and are

cture

nd tohs of

viousyears

City, andings,now



Revenue Structure

population cohorts spend less of their income on taxable goods, which is a reasonable predictorof overall government revenue collections:

Figure 7A: Sales Tax Revenue Profile by Age, 2007

Source: U.S. Bureau of Labor Statistics

Cities also tend to have lower household incomes than their suburban counterparts, which canimpact overall revenue performance. For example, St. Louis’ median household income in 2007was $34,191 compared with $45,114 for the state of Missouri.22 As the following figureindicates, on a per capita basis, higher income households provide a much larger share of overallsales tax collections than other households:

Figure 7B: Sales Tax Profile by Income Demographic, 2007



Revenue Structure

In addition to these demographic changes, other factors negatively affect revenue collection. Asthe following figure shows, personal consumption has shifted from goods to services, which are

often not subject to the sales tax:

Figure 8: Goods and Services as a Percentage of Personal Consumption

Source: Bureau of Economic Analysis

Consumers are shifting their purchases to catalog, internet, and other e-commerce transactions,which have lower percentages of actual sales tax collection. Transactions involving the sale orpurchase of taxable items conducted over the internet are subject to local sales and use tax law.However the 1992 U S Supreme Court’s ruling in Quill vs North Dakota has made collection

30.0%

35.0%

40.0%

45.0%

50.0%

55.0%

60.0%

65.0%

70.0%

1953

1955

1957

1959

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

% Goods Personal Consumption % Services Personal Consumption



Revenue Structure

number that is somewhere in the middle of Fox-Bruce and the claim of loss of just one-tenth thatmuch, suggests an estimated loss to St. Louis of around $2-4 million annually.

Combined, the demographic and personal consumption trends help to explain why sales taxrevenue, as a share of personal income, has been declining nationally over the last 50 years23 andwhy St. Louis has seen sales tax revenue increase by a total of only 3.8 percent since FY1998.

Over the past several years, there have been some hopeful signs about the overall direction of theSt. Louis economy. The City’s population has stabilized and is beginning to grow. As detailedearlier, the City has experienced recent wage and employment growth that has outpaced the

majority of the metropolitan area. The continued development of the downtown core and Cityneighborhoods will be critical to the future growth of the City’s economy and revenue streams.

Long-term Budget Outlook

In order to gauge the City’s future financial position, PFM created a high-level fiscal model thatestimates the City budgetary position based on revenue and expenditure growth assumptionsdeveloped in concert with the City Budget Director. Currently, the City is estimated to face a

$31.4 million structural budget gap in FY2011. Absent action, this gap would widen to a total of $215.7 million over the FY2011-FY2015 period:

Figure 9: Long Term Budget Outlook

($31,432,791) ($37,367,696) ($45,013,781) ($48,810,221) ($53,146,897)

($14,922,207)

($52,289,903)

($97,303,684)

($146,113,904)

($199 260 802)(200,000,000)

(150,000,000)

(100,000,000)

(50,000,000)

0

Dolla

rs ($000)

FY Surplus/ (Deficit)

FY EndingFundBalance



Revenue Structure

the City were to succeed in constraining cost growth to 2.5 percent annually based on projectedFY2010 spending, the City would save $13.1 million in FY2011 and $97.9 million over the

FY2011-FY2015 period.

It must be noted that limiting expenditures is a significant challenge. Cost growth in areas thatinclude healthcare and pensions have been well above 2.5 percent for many years. The City’sunique police governance structure also makes it difficult for the City to control costs.

Rising healthcare costs is a national challenge, and cost growth pressures are not likely tosubside in the near future. Effective management of health care costs requires a balance between

providing high quality coverage for employees and affordability for the employer. Manymunicipalities are examining plan design, health management, and vendor managementstrategies to contain costs and provide quality coverage to employees.

24

The City has already embraced some of these strategies. For example, the FY2010 budgetanticipates an 11 percent increase in the cost of health insurance premiums, which will be sharedbetween the City and its employees. The City will need to remain committed to similar costcontainment strategies if it is to maintain the balance between coverage and costs.

Recently, pension costs have had a significant impact on the City’s budget. The City’s threepension plans were relatively well funded—between 85 and 95 percent of actuarially accruedliabilities—before the recent market declines, but they are now projecting continued costincreases.

The following figure details the cost of funding the City’s pension funds in the last five years:

Figure 10: City Pension Cost Growth

65.6 61.5

60

70





Revenue Structure

The current arrangement likely prevents the City from delivering citywide services in the most

cost-efficient manner. Mayor Slay has called for the City to have authority over the policedepartment; this change would allow the City to explore a coordinated consolidation of specificservices.

Absent legislative change, the City could investigate the possibility of working with the policedepartment to develop a memorandum of understanding (MOU) to more effectively shareservices. This might involve an analysis of the quality of services that are provided by the policedepartment and the City, followed by a mutual decision to determine how to most efficiently

administer the service citywide.

The benefits of shared services in the police department could be expanded to the entire Citygovernment under some form of consolidation. Consolidation of municipal governments hasbeen gaining acceptance and prominence in many areas of the country as an avenue to reduce thecost of government and reduce taxes. In the last two years, many states, including Pennsylvania,Indiana, New Jersey, and New York, have explored government consolidation in different ways.The following table outlines some of the more recent noteworthy efforts:

Table 9: Consolidation Case Studies

State Proposal

Pennsylvania26

The Mayor of Pittsburgh and the Allegheny County Executive have announcedtheir support for a merger between the city and the county after a study led by theUniversity of Pittsburgh evaluated the potential of a merger. The city and countyhave already worked cooperatively to merge 911 call centers and are working tomerge financial systems. At the state level, Governor Ed Rendell has put forth a

proposal to consolidate the state’s 501 school districts to 100.Governor Mitch Daniels has put forth several consolidation initiatives aimed atreducing costs and increasing the effectiveness of local government. Daniels hasproposed several measures including a vast restructuring of county-level



Revenue Structure

State Proposal

New York cont.new villages, consolidation of school district back office functions, and providing aidand incentives for local governments that pursue regional solutions and

consolidation. In light of the recent budget strain being felt across the New YorkCity metropolitan area, many suburban governments on Long Island and inWestchester County are exploring new consolidation efforts.

Government consolidation holds the most promise in areas where there are large numbers of municipal jurisdictions that are smaller in size and population. This is typically in and aroundmajor metropolitan areas where large numbers of inner-ring suburban governments were formedin the 1950’s and 1960’s. Mayor Slay has called for the City to merge with St. Louis County, of

which it was a part prior to 1876.

Similar mergers have taken place between Louisville and Jefferson County, Nashville andDavidson County, and Jacksonville and Duval County. If a full-scale consolidation effortbetween St. Louis County and the City were to be undertaken, it could likely generate significantcost savings, as the City and County could leverage their existing resources more effectivelyacross different governmental functions through streamlined processes and shared resources.



Tax Policy



Tax Policy

To provide a comprehensive overview of the City’s existing revenue structure and tax ratesin comparison to similar cities (both nationwide and within the metropolitan region), severalmeasures were be used to examine the City’s existing tax and revenue structure. St. Louis’tax and revenue profile is also evaluated in comparison with commonly accepted principlesof tax policy as well as other common measures (such as reliability and competitiveness).This analysis is geared toward helping ensure that the City’s revenue streams will be able tosupport critical service need and promote a competitive economic climate.

National Data for Revenue Structures

As previously noted, cities generally use a variety of revenue sources. These includeintergovernmental revenue and own-source revenue (which includes utility, liquor store, andinsurance trust revenue). According to the latest data from the U.S. Census Bureau,intergovernmental revenue accounts for approximately 34 percent and own-source revenueapproximately 66 percent of total local government revenue.30

Intergovernmental revenue is almost entirely from the federal and state governments. Of these, in 2005-2006, local governments received approximately 88.5 percent from state

governments and 11.5 percent from the federal government. Larger local governments,which receive direct payments for programs like the Community Development Block Grant,generally have a higher percentage of revenue received from the federal government.

Own-source revenue is generally broken down into taxes, charges and miscellaneous generalrevenue, utility revenue, and insurance trust revenue. Of own-source revenue, the followingare the percentages collected in each category:

Taxes (52.1 percent) Charges and Miscellaneous General Revenue (30.4 percent) Utility Revenue (11.8 percent)



Tax Policy

would be likely to have a smaller percentage of revenue from the charges for servicescategory.

When discussing revenue structures, it should be noted that averages are often not ameaningful measure. For example, while individual income taxes made up just 1.6 percentof 2005 local government revenue,

31this greatly understates the actual impact for cities that

have that revenue option (which, of course, includes St. Louis) and is of no significance forcities without it. As was noted in a survey of city finances, “the ‘average city’ does notexist.”32 It is necessary to analyze revenue trends and options for relevant groupings of similarly situated cities. The following analyze some of the national factors that areparticularly relevant for St. Louis.

Declining Reliance on the Property Tax

While the property tax is the only local tax used in all 50 states, it has been steadily decliningas a share of local government revenues for decades. One commonly cited study of financesfor cities of over 100,000 population found that property tax revenue declined from 27.1percent of tax revenue per capita in 1977 to 21.4 percent in 2000. 33 Indications are that thistrend is continuing – and may be exacerbated by the state of the housing sector in the current

national economic downturn. While property tax revenue held its own (on a nominal basis)during the previous three recessions, it has declined in many cities during the past two years.

Increased Use of Current Charges to Finance Services

Over the past three decades, charges for services have been the fastest growing category of city revenues. Revenues from charges increased by over 110 percent per capita between1977 and 2000 – much faster than the 26.7 percent overall increase in tax revenues.34 Asnoted above, some of this increase may be in areas where St. Louis does not charge forservices (for example, solid waste, which nationally makes up nearly 7 percent of charges forservices). It does suggest, however, that the City should pay particular attention to this areaas a way to provide greater balance in its revenue structure.



Tax Policy

Income Tax Cities are the Exception, not the Norm

The use of the local income tax is concentrated in a handful of states. As a result, national

averages on city income tax collections are not very useful. Of the 167 cities with apopulation of over 100,000 used in the Wallin survey, only 22 cities in 8 states imposed alocal income tax. Of those that did impose the tax, it had grown in importance, from 17.5percent of all revenue in 1977 to 21.6 percent in 2000.36 Interestingly, cities with a relianceon an income tax appeared to use it more as a substitute for property taxes than cities with aprimary reliance on the sales tax. Income tax-reliant cities only grew property tax revenue by2.6 percent in real terms from 1977 to 2000, compared to 9.7 percent real property taxrevenue growth in sales tax-reliant cities. Property tax revenue comprised an average of only12 percent of general fund revenue in income tax-reliant cities in 2000, compared to anaverage of 21.4 percent for all cities and 17.7 percent in sales tax-reliant cities. 37

Comparison of Revenue Structures & Tax Rates

As previously noted, St. Louis benefits from the authority to collect multiple broad-basedtaxes, which make up the majority of General Fund revenue. This provides the City with areasonably diversified revenue structure. The following table details the City’s existing

revenue profile and the comparable jurisdictions by percentage of total FY2009 GeneralFund revenues: 38

Table 10: General Fund Revenue by Category (% of Total Revenues)

Revenue Source St. Louis Kansas City St. Charles Baltimore Minneapolis Knoxville Louisville Norfolk Omaha Pittsburgh

Earnings Tax 31.0% 32.0% 0.0% 19.5% 0.0% 0.0% 42.1% 0.0% 0.0% 14.6%

Property Tax 11.0% 17.2% 19.2% 51.4% 43.7% 41.9% 26.0% 30.2% 23.8% 29.0%

Sales and Use Tax 10.9% 0.0% 21.4% 0.0% 0.0% 22.3% 0.0% 4.1% 46.0% 0.0%

Payroll Tax 8.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 10.2%

Franchise/Utility

Tax14.0% 20.0% 23.5% 4.8% 7.4% 1.0% 0.9% 5.3% 8.8% 0.1%

Business Privilege

Tax0.0% 0.0% 0.0% 0.0% 0.0% 2.8% 9.2% 3.3% 0.0% 2.0%

Amusement Tax 0.7% 0.0% 0.0% 0.7% 0.0% 0.0% 0.0% 0.5% 0.0% 2.7%

Payments in Lieu of

T0.0% 0.0% 0.0% 0.4% 0.0% 7.3% 0.0% 0.4% 2.3% 1.0%



Tax Policy

When analyzing St. Louis’ revenue structure compared to other cities, there are severalfactors to consider. Among the comparables, St. Louis has arguably the most diverserevenue structure, as it is the only jurisdiction with four different revenue sourcescontributing over 10 percent of General Fund revenues.

While this diversity is a helpful feature, St. Louis is heavily dependent on earnings taxrevenue. In fact, when the earnings tax and payroll expense tax are combined, among thecomparable cities, St. Louis has the second highest dependence on income-based revenuesources.

Finally, St. Louis has the lowest percentage of revenue derived from property taxes—generally considered local governments’ primary revenue source. While this situation is abyproduct of Missouri’s Hancock Amendment and the City’s lower housing costs, St. Louis’percentage of General Fund revenue from property taxes is less than half of everycomparable jurisdiction aside from Kansas City.

Another method to assess the tax burden between jurisdictions is to compare major tax ratesbetween comparable cities. The following tables compare St. Louis to the comparables

across a range of tax categories:

Table 11: Comparison of Real Property Taxes1

PropertyTax

(millage)

ResidentialAssessed

Value PercentTaxable

ResidentialEqualized

(millage)

St. Louis 13.23 19% 2.51Kansas City 20.11 19% 3.82

St. Charles 10.862 19% 2.06

Baltimore 22 68 100% 22 68



Tax Policy

assessed value that is taxable in Missouri, the City’s equalized millage is lower than all thecomparables aside from St. Charles.39

St. Louis is one of five cities in the sample that has some type of earnings or income tax. TheCity also has the second highest local option sales tax among the comparables and the secondhighest overall sales tax rate:

Table 12: Comparison of Income and Sales Taxes

Income taxSales andUse Tax

(Local Option)

Sales andUse Tax

(Total Burden)

St. Louis 1.00% 3.35% 8.24%

Kansas City 1.00% 3.50% 7.73%

St. Charles N/A 3.18% 7.40%

Baltimore 3.05% N/A 6.00%

Knoxville N/A 2.25% 9.25%

Louisville 2.20% N/A 6.00%

Minneapolis N/A 0.90% 7.40%

Norfolk N/A 1.00% 5.00%Omaha N/A 1.50% 7.00%

Pittsburgh 1.00% 1.00% 7.00%Note: Total burden includes county levies.

Among other local taxes, lodging and car rental taxes are generally comparable to otherjurisdictions. These taxes are substantially borne by visitors and have less of an impact onCity residents. While importing tax revenue is generally considered good tax policy, these

tax rates will have an impact on the City’s ability to continue to attract large events, such asNCAA Championships, conventions, and large scale trade association meetings:



Tax Policy

Table 14: Comparison of Local Business Taxes

While St. Louis remains competitive with regional counties on the basis of commercialproperty taxes, the City has the highest sales tax rate along with other applicable businesstaxes. One competitive advantage St. Louis has is that Missouri’s tax structure is morefavorable to businesses than Illinois’. The following details the major tax rates affectingbusinesses in both states:

Table 15: Comparison of State Business Taxes

Missouri IllinoisCorporate Income Tax 6.25% 7.30%

Taxable Income

Three factor orsales only(whichever is

All in-state sales

County Municipality1

Effective

CommercialProperty Tax

Rate

Effective

PersonalProperty Tax

Rate

Business

License

Tax/Fee2

Effective

Manufacturing

Property Tax

PayrollExpense Tax

St. Louis (city) St. Louis city 2.60% 2.16% $200-$37,500 0.52% 0.50%St. Charles County, MO St. Charles city 2.34% 2.26% $65-$75 None None

St. Louis County, MO Clayton 2.71% 2.33% .125% +$5 5.95%3 None

Franklin County, MO Union 1.92% 1.84% $30 None NoneJefferson County, MO Hillsboro 2.32% 2.34% N/A None NoneSt. Clair County, IL Belleville 2.65% 2.65% $75-$550 None NoneMadison County, IL Edwardsville 2.24% 2.24% No fee None NoneMonroe County, IL Waterloo 1.98% 1.98% $55-$105 None NoneMINIMUM 1.92% 1.84% N/A 0.00% N/AMAXIMUM 2.71% 2.65% N/A 0.00% N/AAVERAGE 2.31% 2.23% N/A #DIV/0! N/ADIFFERENCE FROM THE AVERAGE 0.29% -0.07% N/A N/A N/ADIFFERENCE FROM THE AVERAGE (%) 12.6% -3.3% N/A N/A N/A1For each county, the county seat was selected as the sample jurisdiction for each tax unless otherwise noted.2Business license fees vary by type of business3Applies in Clayton Special Business district only



Tax Policy

populations of two million or more, St. Louis did not fare well, coming in 17th of 21.40 Compared to all 59 US cities included in the study, St. Louis also fared poorly, coming in51

st. The City also scored low in rankings on research and development, services, and

manufacturing business tax competitiveness. The study’s findings suggest that, on a nationallevel, St. Louis is not considered a particularly attractive place for major business investment,and this may be one factor why there has been a relative lack of major City corporate tenants.

Tax Burden

A municipality’s tax burden can have a significant impact on its residents’ wealth and theCity’s attractiveness to potential new residents and businesses. Relative tax burdens are

often a subject of analysis, particularly by individual cities or groups with an interest in thiscomparison.

One basic way to view a jurisdiction’s tax burden is to compare the level of revenue perperson or as a percentage of personal income. The following table shows St. Louis andcomparable jurisdictions’ General Fund revenue in relation to population and personalincome:

Table 16: General Fund Revenue Comparison

FY2009 GFRevenue

Per Capita

FY2009 GFRevenue %of Personal

Income

St. Louis $1,283 6.5%

Kansas City $1,080 4.4%

St. Charles $570 2.1%Baltimore $2,111 9.6%

Knoxville $919 4.2%

Louisville $928 3.8%



Tax Policy

often includes income from sales, hotel, and restaurant taxes generated by non-residents. Inaddition, St. Louis (along with Kansas City and Louisville) also generates revenue from non-residents through the earnings tax that substantially impacts the revenue burden on cityresidents.

The District of Columbia (DC) Finance Department publishes one of the better-known taxburden studies, reporting annually on the estimated burden of combined major state and localtaxes for a family of three at various income levels in the largest city in each state. For thisstudy, PFM has used the DC study as a foundation to conduct its own analysis. However,unlike the DC study, PFM’s analysis focused on both aggregate and individual city tax

burdens and relied primarily on 2009 data, when available. The following examines theaggregate impact of the City’s taxes on an average family of three:

Table 17: Comparison of City Tax Burden by Income Level

Estimated City Tax Burden as % of Income - Family of Three by Income Level

$25,000 $50,000 $75,000 $100,000 $150,000St. Louis 4.0% 3.0% 2.8% 2.9% 2.5%

Kansas City 3.6% 2.9% 2.7% 2.8% 2.5%St. Charles 1.2% 1.1% 1.0% 1.0% 0.9%Baltimore 8.4% 9.9% 8.7% 8.2% 8.6%Knoxville 3.6% 2.9% 2.7% 2.8% 2.5%

Louisville1

3.0% 2.4% 2.2% 2.1% 2.2%Minneapolis 3.3% 2.6% 2.2% 2.0% 2.0%Omaha 2.0% 1.9% 1.6% 1.6% 1.5%Norfolk 7.2% 4.5% 4.2% 3.9% 3.8%

Pittsburgh 3.7% 4.7% 4.0% 3.8% 3.9%MINIMUM 1.2% 1.1% 1.0% 1.0% 0.9%MAXIMUM 8.4% 9.9% 8.7% 8.2% 8.6%AVERAGE 4.0% 3.6% 3.3% 3.1% 3.1%



Tax Policy

St. Louis’ city tax burden is below the average for the comparables for all but the $25,000and $100,000 income levels. Like most cities, the City’s tax system is slightly regressive,taking about 1.5 percent more (in terms of share of income devoted to taxes) from thosemaking $25,000 than those making $150,000.

St. Louis’ ranking may be significantly influenced by the fact that it is an independent city,which provides county services in addition to city functions. The following table shows thetax burden for other comparable independent cities and city/counties:

Table 18: Comparison of City Tax Burden by Income Level (city/counties only)

Estimated Burden of Major Taxes- Family of Three by Income Level

$25,000 $50,000 $75,000 $100,000 $150,000

St. Louis 4.0% 3.0% 2.8% 2.9% 2.5%

Baltimore 8.4% 9.9% 8.7% 8.2% 8.6%

Norfolk 7.2% 4.5% 4.2% 3.9% 3.8%

Louisville 4.4% 3.6% 3.4% 3.2% 3.3%

St. Louis Rank 4 4 4 4 4

Among comparable independent cities and city/counties, St. Louis has the lowest tax burdenat each income level.

In sum, St. Louis’ tax system is slightly more regressive than that of comparable cities. TheCity’s overall tax burden is slightly higher than average when compared with comparablecities, especially on low income families. However, the City tax burden is low whencompared with other independent cities and city/counties.

Although analysis of the city tax burden provides unique insights on how much Cityresidents pay in City taxes, an analysis of the impact of all taxes is necessary to gauge thet t ff t f t th i f Cit id t Th f ll i t bl t



Tax Policy

Table 19: Comparison of Aggregate Tax Burden by Income Level

On an aggregate level, St. Louis has the fourth highest tax burden at the $25,000 incomelevel, but one of the lowest burdens for the higher income levels. It should be noted that theCity’s lower tax burden is significantly influenced by Missouri’s status as a lower-tax state.A recent report by the Tax Foundation ranked Missouri’s state-local tax burden as 32nd among states at 9.2 percent, compared to the 9.7 percent average nationwide.41 Among the

comparable cities, only Knoxville is located in a state with a lower tax burden than St. Louis.

The data indicates that the City tax system makes the tax burden on city residents more

Estimated Total Tax Burden as % of Income - Family of Three by Income Level

$25,000 $50,000 $75,000 $100,000 $150,000St. Louis 17.0% 20.8% 23.1% 25.9% 27.2%Kansas City 16.7% 21.4% 23.5% 26.2% 27.6%St. Charles 12.4% 19.6% 22.0% 24.7% 26.2%Baltimore 18.4% 24.9% 25.7% 28.2% 29.8%Omaha 15.0% 22.0% 23.8% 27.1% 28.7%Norfolk 14.1% 19.4% 21.6% 24.1% 25.9%Pittsburgh 19.0% 26.0% 26.0% 28.3% 29.8%

Minneapolis 14.0% 21.3% 23.2% 26.3% 28.2%Louisville 20.4% 23.6% 25.3% 28.1% 29.4%Knoxville 13.9% 17.1% 18.9% 21.5% 23.0%MINIMUM 12.4% 19.4% 21.6% 24.1% 25.9%MAXIMUM 20.4% 26.0% 26.0% 28.3% 29.8%AVERAGE 16.2% 22.3% 23.9% 26.6% 28.2%

DIFFERENCE FROM

THE AVERAGE0.8% -1.4% -0.8% -0.8% -1.0%

DIFFERENCE FROM

THE AVERAGE % 4.9% -6.5% -3.5% -2.9% -3.5%. ou s ran 4 7 7 7 7



Tax Policy

the “deadweight loss” from taxation, must be balanced against the value of the goods andservices that government delivers through use of those tax revenues.

As revenue alternatives are analyzed and considered, the economic impact of these choicesshould be assessed. Generally, there is a preference for smaller, incremental changes in taxesas opposed to large, sweeping changes, particularly where they involve use of a new tax.One reason for favoring incremental changes is that they are less likely to result in significantchanges in market behavior. With larger changes, there is a greater possibility that specificbusinesses or industries will be negatively impacted by the market response to a particulartax. Along the same lines, there generally is a preference for broad use of several tax

methods as opposed to extensive use of only one or two taxes, which may prove to beparticularly burdensome to specific businesses or industries.42

City revenue structures are unique to a particular community and are often driven by stateand local laws and ordinances, history, and local and regional issues, including competitionand intergovernmental relationships. In Missouri, they are also impacted by the Hancock Amendment.

There are widely diverging opinions on what constitutes good tax policy, and in manyinstances, politics and self-interest enter into the discussion. Various resources examine theissues surrounding taxation in a relatively neutral fashion. The National Conference of StateLegislatures has published one frequently-cited list of the “Principles of a High-Quality StateRevenue System.” While the focus is on state revenues, it is a useful guide to taxation ingeneral. Their principles are:43

1. A high-quality revenue system comprises elements that are complementary, including

the finances of both state and local governments.2. A high-quality revenue system produces revenue in a reliable manner. Reliability

involves stability, certainty and sufficiency.



Tax Policy

The American Institute of Certified Public Accountants has published a Tax Policy ConceptStatement that outlines their guiding principles for good tax policy. In many respects, itmirrors the NCSL principles:

44

1. Equity and fairness. Similarly situated taxpayers should be taxed similarly.2. Certainty. The tax rules should clearly specify when the tax is to be paid, how it is

to be paid, and how the amount to be paid is to be determined.3. Convenience of Payment. A tax should be due at a time or in a manner that is most

likely to be convenient for the taxpayer.4. Economy in Collection. The costs to collect a tax should be kept to a minimum for

both the government and taxpayers.5. Simplicity. The tax law should be simple so that taxpayers understand the rules andcan comply with them correctly and in a cost-efficient manner.

6. Neutrality. The effect of the tax law on a taxpayer’s decisions as to how to carry outa particular transaction or whether to engage in a transaction should be kept to aminimum.

7. Economic Growth and Efficiency. The tax system should not impede or reduce theproductive capacity of the economy.

8. Transparency and Visibility. Taxpayers should know that a tax exists and how andwhen it is imposed upon them and others.

9. Minimum Tax Gap. A tax should be structured to minimize noncompliance.10. Appropriate Government Revenues. The tax system should enable the government

to determine how much tax revenue will likely be collected and when.

The National Association of Counties (NACo) has highlighted criteria originally establishedby the International City/County Management Association (ICMA). The criteria include:

45

1. Fairness. A tax should reflect the ability to pay of those who bear its burden, or thetax burden should be matched by the benefits taxpayers receive. In general, taxes that



Tax Policy

1. Transparency is a must2. Be neutral3. Maintain a broad base4. Keep it simple5. Stability matters6. No retroactivity7. Keep tax burdens low8. Do not inhibit trade9. Ensure an open process

10. State and local taxes matter

The Institute on Taxation and Economic Policy, generally considered a liberal think tank, haspublished their own assessment. They identify the following as the building blocks of asound tax system:47

1. Maintain vertical equity (tax systems should not be regressive)2. Maintain horizontal equity (taxpayers in similar circumstances should pay similar

amounts of tax)3. Adequacy (raises enough funds to sustain the level of services demanded by citizens)4. Simplicity5. Exportability (individuals and businesses from other locations that enjoy public

services should help pay for them)6. Neutrality (tax system should stay out of the way of economic decisions).

Finally, a commonly cited local government revenue handbook identifies three criteria that

should guide local government revenue policy making. The criteria are considered to be “thepillars of support for a sound local economy:”

48



Tax Policy

Because Robert Bland’s analysis focuses specifically on local revenue systems, he identifiessome useful areas where local revenue structures may be somewhat different from federal orstate systems. In this analysis, he reaches the following conclusions:

49

When in doubt, use benefits based levies Broad-based taxes and a flat rate are less distorting to the local economy Consumption and income-based taxes should be assessed on potential for border-city

effects Avoid imposing corporate income taxes or gross receipts taxes on business sales Any tax on business should be widely used in the State or region

Taxes on the less mobile components of production (land, buildings, equipment) havethe least detrimental effect on markets Eliminate nuisance taxes that have low revenue yields and high administrative and/or

compliance costs Excise taxes, especially “sin” taxes and those borne by nonresidents usually arouse

the least opposition

Evaluation of St. Louis’ Revenue Structure

As the previous discussion illustrates, there are multiple perspectives on what constitutessound tax policy. Many governments seek a revenue structure that is reliable and not asvulnerable to disruptive swings based on the current state of the economy. Others are moreconcerned that the revenue structure is equitable and does not unfairly burden sometaxpayers relative to others.

The fiscal health of a city is largely tied to its ability to fashion a revenue structure that

manages to meet the majority of the accepted tenets of tax policy – such as adequacy,sustainability, equity (vertical and horizontal), neutrality, and sensitivity. The followingtable analyzes St. Louis’ performance under these principles:





Tax Policy

Figure 11A: Recessions and Tax Revenue Changes

For the recession period, the average annual increase in charges for services was slightlyabove that of comparable cities. However, income tax collections fared somewhat less well,with St. Louis’ average annual change falling below the comparables average, although wellabove Pittsburgh. In addition, St. Louis’ sales and other major tax collections fell during the

recession period, while collections from these taxes actually rose in the comparable cities.However, this finding is heavily impacted by the fact only two comparable cities have localsales taxes. In general, sales tax collections tend to be more sensitive to economic conditionsand St. Louis’ experience may actually be more similar to that of most cities with sales taxes.Property tax increases during the period were also slightly below the comparables average.

During the FY2004 to FY2007 economic expansion, St. Louis’ average annual change in taxrevenues performed better than during the recession, but generally lagged behind comparable

cities, as shown in the following figure:

Figure 11B: Expansion and Tax Revenue Changes

‐10.0%

‐5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

St. Louis Kansas

City

Pittsburgh Baltimore Knoxville Norfolk

Average

Annual

Change‐

Charges

for

Services

(Recession)

Charges for S er vic es Co mp ar ab le s Average

‐3.0%

‐2.0%

‐1.0%

0.0%

1.0%

2.0%

3.0%

St. L ouis Kansas C it y Pit tsbur gh Balt im or e

Average Annual Change‐ Earnings/Income Tax (Recession)

Income Tax Compar able s Average



Tax Policy

Overall, the current City revenue structure has some areas of strength on which to build. TheCity has a diverse blend of revenue sources, based on the relatively broad authority it has tocollect a mix of taxes at the local level. The ability to collect significant income, property,sales, and franchise taxes is important to St. Louis and revenue diversity is considered a bestpractice among local governments. Yet this diversity has not allowed the City’s revenuestream to endure economic downturns better than comparable local governments around thecountry.

While the City’s revenue sources have some positive attributes, there are also reasons to beconcerned about their long-term viability. As previously noted, the City does not have astructurally balanced budget. The City has been able to balance its budget in recent years

through the expansion of telecommunications taxes and one-time actions, such as the releaseof protested earning tax payments and settlements with wireless phone companies. Thesehave enabled the City to continue operations and meet basic service needs, but they are notsustainable over time.

St. Louis is a typical large urban city with a significant portion of City residents who requirea larger amount of government services. There is little evidence that the current revenuestructure will produce sufficient revenue to fund the expected level of essential public

services.

The primary competitive disadvantage the City faces is the impact of its earnings tax. Theearnings tax allows the City to capture revenue from those who work in the City but do notlive in the City; however, the City’s dependence on earnings tax revenue is a cause forconcern. Nearly 40 percent of the City’s General Fund revenues are generated by incomebased taxes, which is well above the average for cities with these taxes.

Some revenue best practices sources suggest that local government should seek to derive nomore than $1.50 in income tax revenue for every $1.00 in property tax revenue.51 InFY2010, St. Louis is projected to generate over $2.70 in earnings tax revenue for each dollar



Tax Policy

Case Study: The Wage Tax in Philadelphia

Background

Since 1940, the City of Philadelphia has levied an earned income tax (wage tax) on residentsand non-residents that work in the city. This tax has contributed to the city’s standing as oneof the highest taxed cities in the nation. Most neighboring jurisdictions do not levy this tax andthose that do have considerably lower rates than Philadelphia. According to a recent study byRobert Inman of the University of Pennsylvania, an average family of four in 2008 would havepaid 14.1 percent of their income in local taxes in Philadelphia, versus an average of 10.8percent in the four neighboring suburban counties.1 The net result has been a significant lossof jobs and population to these surrounding counties. From 1980 to 2006, Philadelphia lost 14percent of its resident population and 103,000 jobs. During the same period, the fourneighboring counties experienced a 22 percent increase in population and gainedapproximately 443,000 jobs.2

As a consequence, recent city administrations have been forcedto offer significant tax incentives to attract major development projects and employers to thecity to compensate for the effects of the wage tax.

Effects of the Wage Tax on the Tax Base

The Inman study found that the wage tax has reduced job opportunities for Philadelphia

residents and ultimately reduced the business and wage tax base. Philadelphia’s wage taxwas at least indirectly responsible for housing value declines, job losses, and reductions inprofits and business sales precipitated by resident population losses. The wage tax plays amajor role in business and resident relocation decisions. As businesses and residents havethe ability to weigh taxes and municipal services, they have found they can enjoy many of theregional amenities of a major metropolitan area while paying the lower local taxes in suburbancounties.

The Inman study also found that the city’s wage tax burden fell most heavily on businesses,as they are forced to pay workers a premium to compensate for the effects of the wage tax.These effects are so significant, that the study estimated that raising Philadelphia’s wage taxrate would yield little marginal revenue, and only have further adverse effects on the businesstax base.3



Tax Policy

Philadelphia has determined that incremental wage tax reductions can be a more practicaland financially feasible way to phase out the wage tax and thus increase business taxcompetiveness and attract new residents. An incremental reduction program may be more

palatable to elected officials and community stakeholders concerned with sustaining fundingfor critical city services. Municipal rating agencies might also respond more positively to it, asit reduces the immediate risk of revenue collapse by spreading out the reductions over alonger period of time.

Most importantly, it sends the signal that the city is moving to reduce the tax burden onresidents and business, making future business investments in the city more attractive. It isimportant to note that Philadelphia’s wage reduction program was executed in tandem withdecreases in the city’s business privilege taxes and an innovative 10 year property tax

abatement program for new residential construction. However, it is evident that the wage taxprogram has improved the city’s competitive standing and allowed it retain and attract moreworkers and businesses that it otherwise would not.

1 Robert Inman. “Local Taxes and the Economic Future of Philadelphia: 2008 Report.” Testimony given at the 2008Police Arbitration Hearing, Philadelphia, PA, June 23, 2008.2

Bureau of Economic Analysis. Regional Economic Accounts: Total full-time and part-time employment by NAICSIndustry, 1969-2006.; US Census Bureau. 2006 American Community Survey.3 Andrew Haughwout, Robert Inman, Steven Craig, Thomas Luce. “Local Revenue Hills: Evidence from Four U.S.Cities.” National Bureau of Economic Research Working Paper Series. 2000.4

Robert Inman. “Local Taxes and the Economic Future of Philadelphia: 2008 Report.” Testimony given at the 2008Police Arbitration Hearing, Philadelphia, PA, June 23, 2008.


The analysis suggests that there is a need to accomplish several tasks through change in thetax revenue structure. These include:

Rebalance the revenue structure by reducing the reliance on income-based taxes,

primarily the earnings tax Reduce taxes that have a significantly negative impact on employment within the

City, primarily the earnings tax



Tax Policy

by charging sales tax on inputs into manufacturing processes. In other cases, it has been lessbased on policy and more based on the ability of certain types of businesses or industry togain exemptions through the political process.

Changes in the economy have also affected the sales tax base. A concern for the future of thesales tax is consumption of goods has been growing more slowly than the growth in theconsumption of services. This has narrowed the sales tax base in most states. It should alsobe noted that relative prices have generally been falling for goods (which are generallytaxed), while rising faster for services (which generally are not taxed). Internet sales havealso had an impact, although in some instances this effect may be overstated.53

Even when considering the differing opinions on impacts, Eugene Steuerle, Co-Director of the Tax Policy Center at the Urban Institute concluded that the sales tax is “not viable in thelong run as a source of revenue” because of the inability to tax inter-jurisdictional sales.54

Most sales and use taxes were created at a time when most consumption was of tangiblegoods, and those goods were subject to the tax. In most instances, all tangible goods aresubject to the tax unless specifically exempted. On the other hand, the consumption of

services has increased over the past 50 years, and they now are nearly two thirds of consumption in the United States as a whole. They have generally not been subject to thesales tax unless specifically enumerated in statute. The following figure reflects the growthin services as a share of consumption in the United States:55



Tax Policy

Figure 12: National Consumption of Goods and Services

Possible Additional Revenue Generation

Because there is little experience with taxing services among Missouri cities, there is littledata to draw upon. In addition, across the nation, there is not an example of a city adopting abroad based sales tax on services independent of all other municipalities in its region, so the

municipal cross border effects are largely unknown. However, there is greater stateexperience with taxation of various services.

S bl S h k i d ii i b dl

30.0%

35.0%

40.0%

45.0%

50.0%

55.0%

60.0%

65.0%

70.0%

1953

1955

1957

1959

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

% Goods Personal Consumption % Services Personal Consumption

T P li



Tax Policy

The pragmatic approach also recognizes that service providers such as doctors, lawyers,accountants, and real estate and other professionals have significant political clout. Even if the tax were desirable, it is probably not going to make it through the political process.

St. Louis’ sales tax base is the same as the State sales tax base. As a result, the City does taxsome services, including:

Gas, electric, water and steam Cable service Computer and software maintenance and installation Telecommunications Lodging Amusement devices

There are a variety of consumer services that could be made subject to the sales tax.Examples of the classes of services recommended for taxing consideration are:

Laundry and cleaning

Photographic studios Beauty/barber shops Shoe repair shops Funeral homes Other personal services Building maintenance Automobile storage Automobile repair and services

Electrical repair Watch jewelry repair Furniture repair

T P li



By applBureau

householpercentand propextensiomillion f The CitThe conrecently(HB814)services.interest i

•$4.6

•Stat

•Pas

• In s

•Opti

•Exp

•Foll

•Sinc

ing consuof Labor

ds characteeneral Fun

erty mainteof the tax

or non-Gen

would neeept of taxatcompleted lto replaceAlthough

n broader ta

million annual

constitution,

ed on to cons

lect cases ma

n would impr

nsion of sales

ws general ec

e services are

er expendittatistics in

ized by aged sales taxance servicto these serral Fund pu

d statutoryion of serviegislative she individuthe bill waxation of se

ly

state statute, a

Impac

umers without

y have an imp

ve horizontal

tax to service

onomic cycles

a growing port

ure behaviothe Consu

and incomo vehicle res would geices would

rposes (par

authority fres has begssion, thel and corpnot passed

vices at the

Additional

Requirednd city code

on Citizen

significant imp

ct on commer

quity as taxat

may slightly r

Reliabil

ion of overall

r as reportemer Expen

cohorts, itpair, housenerate appralso be estis, Metro, et

m the statn to gain trissouri H

rate incomby the Se

state level.

evenue Pot

Statute Cha

/Businesse

act on residen

cial base of th

Equity

ion of goods a

educe the reg

ity/Sufficien

onsumption, t

d by the U.diture Sur

is estimatehold (lawnximately $mated to gec.).56

to expandaction in thuse of Reptaxes withate, it indi

ential

nge

/Developer

ts or business

e City

nd services w

ressivity

y

e expanison

S. Departmey (CES)

that applyare, housek .6 million anerate an a

its sales tastate legisl

resentativesa sales taxates there

in most cases

uld be treated

f the sales tax

Tax Poli

nt of Laboto St. Lou

ing the 1.37eeping, etc.nnually. Thditional $6.

to serviceature. In thpassed a bi

on goods anay be som

more fairly

may reduce

y

r,is

5),e6

s.ellde

T P li



Tax Policy

2. Reduce the Number of Sales Tax Exempted Goods

At present, certain categories of goods are exempted from the state and city sales taxes. In

general, these items are exempted because they are considered essential purchases, arecommonly associated with a desirable activity, or are already subject to tax. For example, inMissouri, certain classes of manufacturing and agricultural property are exempt because theyare associated with business activity that strengthens the state economy and creates jobs.Other purchases, such as those of water, electricity, and natural gas are exempted becausethey are already subject to local utility franchise taxes. In addition to these items, textbooks,motor fuel, and prescription drugs are exempted from the sales tax under Missouri state law.

Removing these exemptions could provide a new sustainable revenue source for the City.Exempting these purchases leaves a significant portion of common household purchasesuntaxed, a problem that has worsened with the national shift away from goods consumptiontoward services. Removing these exemptions can be a way to at least partially counteract theeffects of that trend, while strengthening the City’s anemic sales tax base. At least one othergovernment has been considering this option as way to strengthen its tax base and diversifyits revenue portfolio. A group of California legislators recently developed and proposed a

plan that would remove the state sales tax exemption on services.

Since demand for exempted goods is highly inelastic, it is likely that consumers will bear thebrunt of the tax. Because of this, extension of the tax should not significantly affect Citytextbook sales; however, this should increase the tax burden on city college students thattypically have lower incomes. Removal of the exemption on motor fuel would also raise gasprices in the City relative to the rest of the region and possibly shift business away from Cityservice stations. Imposition of the tax on prescription drugs would likely bring in significant

new revenue, as these purchases tend to be frequent and common. However, the effect onseniors and the disabled would be significant and local pharmacies, particularly independentpharmacies with limited capacity to bear the effects of the tax, would be greatly impacted.

T P li



3. I

Currentlare levie

deed traseller.transferr

•$1.8

•Stat

•Larg

•Opticlas

•Exte

• As dstabl

•Coll

•Addiothe

•Som

•Fits

pose a Re

, 36 states id on the pur

sfer procesost often,

d; however

million annual

constitution,

ely passed on

n would impres of taxpaye

ntion of the sal

emand for thee source of re

ction and ad

tional adminsitr purchases

e adverse imp

ith sound tax

al Estate T

mpose a rechase price

sing and recit takes thsome citie

ly

tate statute, a

Impact

to consumers,

ve horizontals

les tax to pres

e items is notenue

Ea

instration wou

rative costs sh

act; it could re

policy to esta

ansfer Tax

l estate tranof a sold pr

ording. Thform of ause a flat r

dditional R

Requirednd city code

n Citizens/

could have sli

E

quity as it spr

ription drugs

Reliabilithighly influenc

se of Adopti

ld be the resp

ould be minim

Economi

duce patronagBalanced o

lish the broad

sfer tax of perty, ofte

e tax can bn ad valoreegistration

venue Pote

tatute Chang

usinesses/

ght impact on

uity

eads the tax b

nd textbooks

/Sufficienced by econom

on/Administ

nsibility of the

al since the st

c Efficiency

e of city servicr Broad-bas

st possible b

ome kind.associated

imposedm tax on tee. This is

ntial

e

evelopers

ity pharmacie

rden more ev

ay slightly in

ic conditions,

ration

state

te already coll

e stations anded

se

Real estatewith coveri

n either thee value of often appli

s and service

enly across dif

rease regress

it should be a

ects City sales

pharmacies

Tax Poli

ransfer taxg the cost

buyer or ththe propertd as a doll

tations

ferent

ivity

elatively

tax on

y

sf

eyr



Tax Policy



Tax Policy

In recent years, the housing market in St. Louis has weakened, with the average home priceand the number of homes sold experiencing a 29 percent decline and the average home value,a 42.2 percent decline from March 2007 to March 2009, as shown in the following table:

Table 22: St. Louis Housing Market Statistics

2007 2008 2009

Average Home Price $205,517 $185,359 $150,356

Homes Sold 18,242 15,615 11,3561

Value of SoldResidentialProperties

$3,749,041,114 $2,894,380,785 $1,707,442,736

1Annualized estimate based on January-March figuresSource: St Louis Association of Realtors

Imposition of a real estate transfer tax in St. Louis would provide an effective way to capturethe value of property value increases without being subject to Hancock Amendmentlimitations. Revenue is dependent on the amount of real estate sales activity. A significantupswing or downswing in the City housing market could have an appreciable effect on

collections, yet the long–term stability of the tax is ultimately tied to City property values.As demand for housing is unlikely to be affected by such a small levy, the city real estatemarket is not likely to be materially impacted.

Not surprisingly, real estate transfer taxes tend to engender strong opposition from localrealtors associations. However, earmarking revenue to popular programs and activities canmake the tax more politically acceptable and engage more stakeholders to support it.Likewise, tying the passage of the tax to a broader package of reduction in the earnings taxmay allow an opportunity to soften the complaints of realtors, who should also see increaseddemand for City properties as a result of a reduction in the earnings tax.

Tax Poli

y



4. P

Public sademonstf di

•$7.2

•Stat

•Burd

•May

•Incr

•Mor

•Sincactiv

•Wou

•Wouproc

•Posbe h

•Tax

ursue Imp

fety is a greated this co

bli

million annual

statute, city c

en would rest

impact volum

ased veritical

sensative to

e collections aity

ld require coor

ld incur new aessing exempt

ibly adverse ieavily affected

base limited to

sition of a

at concern incern whenf t i 2008

ly

ode, and city

Impac

primarily on se

of home sale

equity by shifti

ps and downs

re tied to the v

E

dination with

ministrative cions

pact on volu

real estate pr

11 Surcha

n St. Louis,they passe

O th

Additional

Required

oter approval

on Citizens

llers, not likely

s

ng greater pori

Reliabil

in the housin

olume of real

ase of Adop

ssessor's Offi

osts associate

Econoe of homes s

Balanced

perty sales a

ge on Wir

as in mosta one-half

th 91

evenue Pot

Statute Cha

/Businesse

to affect signi

Equity

ion of tax burd

ity/Sufficien

market yet b

state sales th

tion/Admini

e,

with tracking

ic Efficiencld in the City,

or Broad-ba

d thus relative

less Comm

ajor metropercent sal1 t h

ential

nge

/Developer

icantly busine

en to property

y

nefits from st

y may depen

stration

property sale

yhowever the

sed

ly limited

unications.

olitan cities tax incre

i i

ss community

owning taxpay

blility of prope

heavily on th

and propertie

ity economy i

Tax Poli

. City votese to suppo

t t

and developer

ers

rty values

growth in this

s and

s not likely to

y

srt



Tax Poli y



5.

Currentland othe

•$2.1

•Stat

•Burdsigni

•Impr

•Likelgro

•Somalre

•Likel

• A chbroa

Impose a J

, the City sr retail outl

million annual

voter approv

en would fallficantly affect

oves horizont

y to be a relias

e adminsitratidy in effect

y limited adve

ange would bder base of co

nk Food T

ales tax appets. Howe

ly

l

Impac

n individualsusiness com

l equity by en

le source as r

E

e costs since i

se impact as t

consistent witmmunication d

ax

lies to foodver, there i

Additional

Required

on Citizens

ho own cellulunity or devel

uring all those

Reliabili

evenue should

ase of Adop

t would be a n

Econohe surcharge

Balanced

h broad-basedevices

purchases is an opport

evenue Pot

Statute Cha

/Businesse

r and VoIP coopers

Equity

who use/hav

ty/Sufficien

grow as the p

tion/Admini

ew tax, but col

ic Efficiencould not caus

or Broad-ba

tax policy as

n grocery stunity for t

ential

nge

/Developer

mmunication d

access to 911

y

reference for

tration

lection is simil

ye individuals t

sed

he surcharge

ores, convee City to r

evices, not lik

service pay f

ireless comm

r to landline p

stop using wi

would be appli

Tax Poli

ience storeealize a ne

ly to

r its operation

nication

hones which i

reless phones

ed across a

y

s,

Tax Policy



Tax Policy

conference U.S. Center for Disease Control leader Dr. Thomas Freiden stated that increasingthe cost of unhealthy foods “would be effective” at reducing obesity.66 Dedicating revenuefrom this source to the Department of Health could free up considerable General Fund

revenues for other purposes. The tax is more likely to attract public support when tied topopular programs.

The tax could have a number of negative effects that should be considered before adoption.Ultimately, the tax would shift some portion of snack food purchases away from the Citytoward nearby jurisdictions, reducing City sales tax revenue from these purchases. As withcigarette taxes, it is likely to encourage activity that avoids the tax. In addition, the burden of the tax would tend to fall on poorer City residents, as snack food purchases tend to form alarger percentage of their income due to its accessibility and affordability. A recent analysisfound that in the United Kingdom, the poorest 2 percent would pay 0.7 percent of theirincome toward the tax, while the wealthiest cohort would only pay 0.1 percent.67

As previously noted, imposition of a junk food tax is often controversial. Snack foodcompanies oppose them on the grounds they are discriminatory taxes that unfairly singles outtheir particular industry. A consensus would need to be developed on what items should be

subject to the junk food tax and discussions on the various health benefits of snack fooditems. City imposition of the tax is uncommon; much of the high profile oppositionexperienced in states might not surface in St. Louis.

One study also found that the junk food tax can also be difficult to collect.68 Since this taxwould not be collected by the state and remitted to the City like the City sales tax, reportingand tax remittance issues could complicate collection of the tax. One strategy that stateshave used to mitigate these problems is limiting the tax to grocery stores and convenience

stores.

Although most commonly levied on snack foods such as potato chips, hard pretzels, and

Tax Poli

y



additionapproxi

6. E

In gener

•$25.

•Stat

•Woufood

•Wou

•Stabvend

•Admandtax

• Not lstor

•Wou

l five percately $25.5

xtend the

l, it is fairl

5 million annu

statute, city c

ld change coand soft drink

ld decrease v

ility is likely toors outside th

inistrative costconvenience s

ikely to have ss in the City a

ld broaden tax

nt tax onmillion ann

igarette O

y common

lly

ode, and city

Impac

pliance requirsales in the Ci

rtical equity b

be adverselyCity

E

s for collectingtores would be

ignificant econnd shift snack

base to includ

alty and sually.

cupation T

or municip

Additional

Required

oter approval

on Citizen

ments for groty

increasing th

Reliabil

ffected by sm

ase of Adop

the tax wouldnecessary as

Econo

omic impact, yfood purchase

Balanced

e snack foods

gary snack

ax to Retai

lities acros

evenue Pot

Statute Cha

/Businesse

cery and conv

Equitytax burden o

ity/Sufficien

ggling activity

tion/Admini

tend to be higwell as devel

ic Efficienc

et would hurt ts to nearby jur

or Broad-ba

and soft drink

foods and

l Sales

s the nation

ential

nge

/Developer

nience stores

n low income r

y

, tax evasion,

stration

h. Identificatiopment of proc

y

he business oisdictions

sed

s

soft drinks

to impose

, reduce the v

esidents

nd shifts of p

n and registratedures for rem

grocery and c

Tax Poli

would yiel

ome form

lume of snack

rchases to

ion of groceryittance of the

onvenience

y

d

f

Tax Policy



Tax Policy

Figure 13: State Tobacco Tax Increases

Source: Danny Dougherty, Stateline.org

Cigarettes impose costs to society for remediation of public health issues associated with

smoking. Cigarette taxes are generally seen as an effective way of recouping those costs.However, it is also true that unusually high tax levies increase cigarette smuggling and illegalsales that can quickly lead to other forms of criminal activity. This activity can also increasechildren’s access to cigarettes, as sales migrate from convenience stores to street corners. Inaddition, cigarette taxes tend to be regressive, having a greater impact on lower incomesmokers. For example, an individual earning $25,000 per year spends roughly 1.3 percent of annual income on tobacco products per year, while a person earning $70,000 spends about0.4 percent.74

The State of Missouri currently imposes a 17 cent per pack tax on cigarettes, which ranks asthe second lowest tax in the nation.75 In addition, the City currently imposes a cigarette

Tax Poli

y



7. I

Many cidiscourathe sociataxes haevidencealso sug

•$2.6

• State

•Couloutl

•Wou

• Wolow

• Cou

•EcoCity

•Exp

pose an A

ties havee undesira

l costs of ae been shotheat theseest that liqu

million annual

statute, city cod

d have slight nts that sell cig

ld decrease v

ld be reasona

ld be administ

omic impact liis the only juri

nds City tax b

lcoholic Be

sed an alcle behaviorcohol whiln to ameli

taxes reducor taxes ma

ly

e, and city voter

Impac

egative effectarettes

rtical equity b

bly reliable rev

E

ered as a surc

kely to be miniiction to imple

ase by extendi

verage Tax

oholic bevs. Studies

discouragirate certainthe inciden

y reduce alc

Additional

Requiredapproval

t on Citizen

on convenienc

increasing ta

Reliabilenue stream,

ase of Ado

harge to the Ci

Econo

mal, may shiftment the tax

Balancedng the cigarett

rage tax tave found

ng excessivsocial pro

ce of auto aohol consu

evenue Pot

Statute Cha

/Businesse

e stores, phar

Equity

burden on lo

ity/Sufficienas the price el

tion/Admini

ity sales tax, c

ic Efficien

cigarette sale

or Broad-be tax to retail

o enhancethe tax cane consumptlems.76 Foccidents anption by h

ential

nge

/Developer

macies, grocer

er income re

ysticity of dem

stration

llected and re

y

to neighborin

sedales

their revenprovide aion. In add

example, tteen drinki

avy drinker

y stores, and

idents

nd for cigarett

mitted by the

Missouri juri

Tax Poli

ue base anay to recouition, alcohere is stron

ng.77

Studis 78

ther retail

es tends to be

tate

dictions if the

y

dplgs

Tax Policy



Tax Policy

Missouri House of Representatives has recently considered, but not adopted, legislation thatwould increase the liquor tax. Other states have also recently considered or moved toincrease their liquor taxes, as shown in the following figure:

Figure 14: State Liquor Tax Increases

Source: Danny Dougherty, Stateline.org

Imposition of a liquor tax in St. Louis would likely bring the total tax rate on alcoholicbeverages in line with cities in other states.

Currently, the City imposes annual license fees on manufacturers and retail and wholesale

distributors of alcoholic beverages. While all of the comparable cities have some sort of alcoholic beverage permit or licensing fee for both wholesale distributors and retail outlets,only three of the comparable cities currently levy alcoholic beverage taxes on sales, as shown

Tax Poli

y



AdoptinA stratepopular

programpresente Based oretail salannually

•$3.6

•Stat

•Wou

•Wou

• Wolow

• Wo

•Wouman

this tax wy to enlistity health

. Framingas a way t

liquor taxs of wine a

.

million annual

statute, city c

ld increase ta

ld decrease v

ld be reasona

ld entail new

ld shift consuufacturing and

uld requireoter supporograms, w

the tax in trecover th

revenue in snd distilled

ly

ode, and city

Impac

burden on alc

rtical equity b

bly reliable rev

E

dministrative

ption away frdistribution in

voter approt for the tahile reducin

is way micosts to so

imilar jurispirits in the

Additional

Required

oter approval

t on Citizen

oholic bevera

increasing ta

Reliabil

enue stream,

ase of Ado

osts to advert

Econo

m alcohol towustry

Balanced

val under thwould be

g the amoun

ht make thiety from a

ictions, it iCity would

evenue Pot

Statute Cha

/Businesse

e manufacturi

Equity

burden on lo

ity/Sufficien

as the price el

tion/Admini

ise and collect

ic Efficien

ard other beve

or Broad-b

e terms of to tie at leat of General

tax morecohol abus

estimatedgenerate a

ential

nge

/Developer

ng and distrib

er income co

y

sticity of dem

stration

the tax

y

rages, yet hur

sed

he Hancock t some of tFund subsi

alatable toinduced be

seven percproximatel

tion industry

nsumers

nd for alcohol

the city alcoh

Amendmene revenue t

dies for the

voters, whehaviors.

ent tax on a$3.6 millio

tends to be

olic beverage

y

t.oe

n

lln

Tax Policy



y

Other cities have seriously considered or enacted plastic bag taxes. This year, Seattle,Washington enacted a 20 cent “green fee” on paper and plastic bags that will be the subjectof a voter referendum in August. New York, New York and Philadelphia, Pennsylvania

have considered a tax but rejected it based on its impact on families. Other cities, includingPortland, Oregon have been hesitant to charge such a tax in the middle of an economicrecession. Most recently, the District of Columbia enacted a five cent tax on plastic bags,earmarked to cleaning up the Anacostia River. Justification for the tax is often on thegrounds that it promotes conservation of natural resources while reducing the volume of litterin city streets and clogging agents in rivers and streams.

These taxes tend to be opposed by merchants and plastic and chemical trade groups, sayingthe taxes amount to an undue focus on their industry. Plastic bag manufacturers havevigorously opposed the taxes and have been known to sue municipalities that enact plasticbag bans.81

The tax tends to be rather regressive, as lower income individuals often lack personalvehicles and tend to use them more often to carry groceries home and for other practicalpurposes. In addition, it is likely there would be cross border effects, causing City residents

near the city limits to shop outside the city, reducing City sales tax revenue.

As adoption in St. Louis would require voter approval under the Hancock Amendment, itcould be helpful to tie the proceeds of the tax to environmental cleanup and educationprograms, releasing General Fund revenue for such activities for general purposes. Ascommunication to the public of such a change would be critical, an advertising campaignwould have to start to build awareness of the tax. Collection of the tax could also be anissue, as it would depend on a certain amount of voluntary compliance. The District of

Columbia has addressed this issue by allowing stores to keep a small portion of the tax ascompensation for collection.

82

Tax Poli

y



9. E

Currentlestablishincreasinup well

FY2001The strecontribut

•$1.6

•Stat

•WouCity

•Wou

•Taxbeh

•Admthe tmer

•Tax

•Taxi

xplore Adj

, St. Louisments. Theg on averaduring rece

to FY2004gth of the

ions to the

million initially

statute, city c

ld change co

ld decrease v

likely to be vervior changes

inistrative costax, with 1 centhant oppositio

may hurt groc

ng plastic bag

ustments to

levies a 1.City’s rest

e 2.9 percesions, as re

ownturn, wrestaurant tost of city s

declining to $

ode, and city

Impac

pliance requir

rtical equity b

y unstable, rev

E

s would be miper bag as con

ries and conv

would broade

the Restau

5 percent turant tax bt annually

staurant tax

hile Generaax base preervices fro

Additional

20,469 annua

Requiredoter approval

on Citizens

ments and ta

increasing th

Reliabil

enue should d

ase of Adop

imal, merchampensation.

Econo

nience stores

Balancedn the City's ta

rant Gross

x on thease has beefrom FY19collections

l Fund revesents a univisitors an

evenue Pot

lly

Statute Cha

/Businesse

collection bu

Equitytax burden o

ity/Sufficien

rop off as awa

tion/Admini

ts would haveoter approval

ic Efficienc

in the City an

or Broad-babase

Receipts T

ross receipn growing8 to FY20increased

ues as a wue opportu

d non resid

ential

nge

/Developer

den for food s

n low income r

y

reness of the t

stration

responsibilitymay be difficul

y

shift purchas

sed

x

s of all sitt a slow bu8. Reveny 0.7 perce

ole declinenity to solints enjoyin

tores, reduce f

esidents

ax increases a

for collecting alt due to indust

es to nearby ju

down dinint steady rates have helnt during th

0.5 percenit additionmeals in th

ood sales in

nd consumer

nd remittingry and

risdictions

y

g,

de

t.le

Tax Policy



y

meals served. The tax could also increase demand for take-out meals, because they are notcurrently subject to the tax. In addition, it is likely the resilience and continued growth of therestaurant tax base will lessen the effect of any reduction in restaurant meals sales.

One option would be to limit the increase to downtown only, perhaps aligned with currentbusiness or community improvement districts, as is done in Minneapolis. Restaurant demanddowntown is more likely to be inelastic, due to its status as a hub for tourist and businessactivity. In addition, tourists, business travelers, and convention attendees are less likely toview leaving the City for restaurant alternatives as a viable option.

A logical option would be to expand the restaurant tax to apply to take-out establishments.This would broaden the City’s tax base and also create a more equitable outcome by applyingthe tax to both sit down and take-out establishments. As take-out establishments tend to befrequented more often by lower-income individuals, the burden of the tax would tend toaffect lower income residents more heavily than others, increasing the regressivity of theCity’s tax system. However, application of the tax to take-out food can also discourageunhealthy food purchases in favor of healthier options.

Based on the restaurant tax base assumed in the City’s projected FY 2010 restaurant taxrevenue estimates, it is estimated that increasing the restaurant tax to 2.5 percent wouldgenerate in the range of $4.5 million annually. Extending the current 1.5 percent restauranttax to take-out establishments would generate approximately $4.6 million annually. If bothsit down and take-out restaurants were taxed at 2.5 percent, the tax would generate anadditional $12.1 million annually. Any of these options would require voter approval underthe provisions Hancock Amendment.

Tax Poli y



10. I

The costcosts an

•$4.5esta

•Stat

•Buror d

•Imprresiesta

•Like

•Miniiden

•Posindu

•Exte

crease Us

to provideother facto

million annualblishments, or

e constitution,

en would restvelopers

oves horizontents do. Alsoblishments

ly to be a relia

mal adminsitratify and notify

ibly adverse istry is not likel

ntion to take o

of Service

municipalrs. Many l

ly for increasin$12.1 million f

state statute,

Imp

primarily on fo

l equity by enimproves tax f

le source as r

tive costs sincity take out e

pact on voluto be severe.

ut establishme

Charges

services hacal govern

Addition

g the restaurarom taxing sal

Requir

nd city code

ct on Citize

od establishm

uring visitorsairness by ap

Relia

evenue has pr

Ease of Ad

e tax is alreadtablishments

Econe of restauraMay lead to i

Balanc

nts would exp

grown ovents have r

l Revenue

nt tax, $4.6 ms of sit down

d Statute C

ns/Busines

nt owners, no

Equity

nd non-residlying the tax t

ility/Suffici

oved stable ov

ption/Admi

in effect for r

omic Efficiet meals serve

ncreased patr

d or Broad-

nd the City's t

r time, duesponded b

otential

illion from extend take out e

ange

es/Develop

t likely to signi

nts contributeboth sit down

ncy

er the past de

nistration

staurants. Ma

ncyin the City, h

nage of resta

based

ax base

to increasiy making se

nding the existtablishments

rs

icantly affect

to the cost ofand non-sit d

ade

y require addit

owever effectrants outside

ng personnrvice charg

ing tax to taket 2.5%

usiness com

ity services juwn food

ional effort to

n restaurantcity

ls

out

unity

t as

Tax Poli

y



updatedthat are sUser Fe

potential

In additibe subjepropertyof this scould re

• $4.7

•App

•The

dev

• Impr

• Likelajus

•Som

in decades,et by state schapter, t

to be a mor

n, there arect to a sereasementsrvice andlize increas

million annual

oval by Misso

impact would

lopers who m

oves horizont

ly to be a morments to servi

e adminsitrati

including thtatute ande City’s se

e robust rev

some serviice charge.ithout a ne

ther similad revenue

ly

ri voters

Impac

e felt by thos

y be faced wit

l equity by en

sufficient souce charges

e costs may b

e City’s autould be movice charg

nue stream

es that theFor exam

arby lightedservices while reduci

Additional

Required

t on Citizen

who seek Cit

h higher costs

uring all those

Reliabil

ce of revenue

ase of Adoe associated

Econo

omobile licre difficult ts have not

for the City

ity provideple, the Citalley at a c

ere recoverng subsidiz

Revenue Po

Statute Ch

/Businesse

services. M

for permits an

Equity

who use City

ity/Sufficien

that would inc

tion/Adminith new fees,

mic Efficien

nse charge.o adjust. Hkept pace

.

s to citizensy providesost of $170,d throughtion of sele

tential

nge

s/Developer

y have a sligh

d licenses

services pay f

cy

rease consiste

istrationut overall stru

y

There areowever, as dver time a

free of chafree lightin000 per yeaservice chart properties

s

t impact on bu

r its operation

nt with more r

cture is alread

other chargetailed in thd have gre

ge that coulg for privar. If the coges, the Cit.

inesses and

gular

in place

set

desty

Tax Policy



Expand the existing wholesale customer base to generate additional General Fundrevenues.

Water Division PrivatizationThe sale of the Water Division could bring a significant one-time payment to the City’scoffers, but would also require an extensive feasibility study and cost benefit analysis. Inaddition, there would be significant transaction costs associated with the sale, which wouldreduce the immediate benefit realized by the City. The revenue the City would have togenerate would have to be weighed against several factors:

The City would likely lose the recurring franchise revenue it receives from the waterdivision for a one-time benefit.

Currently the City largely does not have water meters for a significant proportion of its residential population and thus does not charge customers based on quantity of water consumed; this would likely be viewed as a negative by any potential owner.

A potential owner would likely seek to maximize the return on investment byincreasing water rates currently set by City ordinance.

City leadership may not wish to change the current operations of the water division.

In 2007, St. Louis won the title of “Best Tasting City Water in America” in a U.S.Conference of Mayors competition. A move towards privatization would very likely prove difficult in the current

economic climate. The City of Chicago, which has been a leader in privatizing publicassets, recently cancelled its planned sale of Midway Airport due to the investmentteam’s inability to secure financing. In 2008, the Commonwealth of Pennsylvaniasolicited bids to lease the Pennsylvania Turnpike which were lower than initiallyprojected and the highest bidder eventually withdrew its bid amid credit concerns.

Increase Water Rates

City Ordinance #67919 approved water rate increases of 19 percent in April 2008 and 11

Tax Policy



on the water division’s audited financial statements. From FY2005 to FY2008 the City hasgenerated between $3.1 and $3.9 million from wholesale water contracts, which helpsubsidize the water rates for City residents and businesses.

The City’s policy of selling water to large industrial users or surrounding jurisdictions isrelatively common. The City of New Berlin, WI recently entered into a 20 year agreement topurchase water from Milwaukee.86 Portsmouth, VA has received over $8 million annuallyand is projected to generate over $12.8 million in FY2010 from wholesale contracts with thenearby suburban communities of Suffolk and Chesapeake.87 St. Louis’ water treatmentplants are currently not operating near capacity and thus have the ability to increase supplysignificantly at a low marginal cost if the City can identify additional potential customers.

New customers would most likely come from newer fast growing suburban communities inthe region who do not have access to water and do not want to incur the expense of buildingexpensive infrastructure. Another approach would be for the City to explore marketing itswater to other jurisdictions in the region that may currently rely on Missouri American oranother provider.

Conclusion

The current economic and credit environment is not favorable to privatization of the waterdivision. Even if it were the preferred policy option, the revenue generated would besignificantly constrained by the current credit markets. In order to more effectively leveragethe water division, the City should examine annual modest adjustments to water rates, intandem with identifying ways to increase wholesale revenues through new or expandedcontracts. This would provide the City with additional revenue based on the valuable serviceit provides its residents. Success in increasing wholesale revenues would allow the City tobetter leverage the capital investments it has already made and import revenue from non-City

sources.

Tax Poli

y



12.

Businessbusiness

•$1.0wat

•City

•The

• An i

•Wat

•Virtuwhol

•Veryhav

•Cha

estructure

licensing iinformatio

million annualr rate increas

code

impact of incr

crease in wat

r is a more rel

ally no adminsesale contract

limited advermetered rate

ges would be

the City’s

s used byn and to

ly; potential ins

Impac

ased water rat

r rates may b

liable source o

itrative costs as may require

e impact as a

consistent wit

raduated

local goverprotect th

Additional

reases based

Required

t on Citizen

es would be f

somewhat re

Reliabil

f revenue sinc

ase of Ado

s water bill paadministrative

Econoincrease wou

Balanced

broad-based

usiness Li

nments acrpublic a

Revenue Po

on success of

Statute Ch

/Businesse

lt by all City r

Equity

gressive for lo

ity/Sufficien

it is a necess

tion/Admini

ment structurcosts

ic Efficienld only alter b

or Broad-b

tax policy

ense Tax

oss the natgainst inc

tential

expanding wh

nge

s/Developer

sidents and b

wer income in

cy

ity

stration

e is already in

yhavior of City

sed

ion as a wmpetent a

olesale sales

s

sinesses

ividuals and h

place; howeve

businesses an

ay to colled dishone

nd level of

ouseholds

r additional

d residents wh

tst

o

Tax Policy



The City’s business license tax is structured as a graduated set of license fees based on abusiness’ number of employees. Restaurants, hotels, amusements facilities, cigarettevendors, parking garages, and manufacturers are subject to separate licensing fees that are

levied on an ad valorem basis on gross receipts, sales, or personal property value. Thisarrangement is not common among other comparable cities, as shown in the following table:

Table 26: Comparable Business License Tax Structures

Minimum Fee Maximum Fee Fee BasisStructured by

Business Type?

St. Louis $200 $37,500 Number of employees No

Kansas City $25 $693,867 Gross annual receipts Yes

St. Charles $25 $5,000 Flat fee by business type Yes

Baltimore $10 $1,000 Flat fee by business type Yes

Knoxville 0.04%1 0.10% Gross annual receipts Yes

Louisville 1.45% 1.45% Net profits No

Minneapolis $5 $10,286 Flat fee by business type Yes

Norfolk $50 0.58% Gross annual receipts Yes

Omaha $5 $600 Flat fee by business type Yes

Pittsburgh 0.10% 0.10% Flat fee by business type No1Percentages indicate the fee is levied on a percentage of gross receipts.

In most comparable cities, business license taxes are structured based on the type of business,usually with smaller businesses (such as vending machines, sidewalk vendors) paying lowerfees and large and/or nuisance businesses (concert hall operators, adult businesses) payinghigher fees, based on their impact on the city. Three comparable cities assess businesslicense taxes based on gross annual receipts, with the rest charging a flat annual fee based onthe type of business. Only Louisville provides an exception, with a 1.45 percent flatoccupational license tax levied on net profits.

Tax Policy



of these services through higher tax levies. It is considered good tax policy to tie tax leviesto the benefits received by taxpayers from associated City services.

The business license tax can be a flexible source of significant revenue that can be utilizedmore broadly to meet City priorities.89 However, St. Louis’ current license structure, tied tothe number of employees, does not readily allow this. An ad valorem levy would captureincreases in City business gross receipts or profits while ensuring proportional contributionsfrom both large and small businesses.

In comparison to several comparable cities, St. Louis does not receive a significant amount of business license tax revenue per business:

Table 27: Average Business License Tax Revenue per Business

Although St. Louis is roughly in the middle of comparable cities in business license taxreceipts, the cities with higher license tax revenues per business than St. Louis each have anad valorem levy on gross or net receipts. Among cities with flat licensing fees, St. Louisextracts the greatest amount of revenue per business.

Unlike other comparable cities, St. Louis also has an earnings tax on business net receipts.When the average net profits tax liability per business is added to St. Louis’ estimate, St.

Louis receives on average $2,747 per business, the second highest of the comparables. Of course, changes to the license structure that are tied to reductions in the earnings tax wouldameliorate this issue

St. Louis St. Charles Baltimore Knoxville Louisville Norfolk Omaha PittsburghComparables

Average

Avg. Business License

Fee/Tax per Business1 $797.09 $210.20 $138.60 $553.95 $2,082.10 $4,148.11 $175.21 $1,146.17 $1,207.76

1Based on 2006 city budget and census data.

Number of businesses for St. Charles, Knoxville, Omaha, and Pittsburgh are estimates based on each city's proportion of county businesses in 2002. Data was not available forKansas City and Minneapolis.

Tax Policy



Adopting this tax could also increase the overall tax collection rate from businesses.Pittsburgh recently undertook a similar reform, when it abolished its flat feeoccupational privilege tax and ad valorem mercantile tax in favor of a new payroll

preparation tax and reduced business privilege tax on gross receipts. The City plansto phase out the business privilege tax in FY2010. As a result of the change,Pittsburgh has seen a modest increase in annual business tax collections. Adopting asingle business tax structure not only eases compliance, but can make the City morecompetitive with other regional jurisdictions.

2. Develop a graduated business license tax structure by business type that is tied

to impacts on the City services.

Restructuring the business license tax in accordance with business type can be aneffective way to discourage or encourage the development of certain businesses in thecity. It can provide a way to compensate the City for the variable service impacts of different businesses, while eliminating the inequities of the current payroll size basedtax structure. It would also bring the City’s tax system more in alignment with thebenefits principle, by allowing association of business license fees with respectivebusiness service demands on the City.

3. Convert the business license tax into an ad valorem levy on gross receipts.

Converting the current payroll size based structure into a simple gross receipts levywould not only reduce administrative costs, but possibly increase the collection rate.Business income reported to the IRS and Missouri Department of Revenue can beused to help recover City tax liabilities from non-filing businesses. This option has

the same benefits from simplification as the occupational license tax, yet has theadded benefit of allowing for coordination and possibly joint filing with othergovernmental entities.

Tax Policy



Table 28: Effect of Business License Tax Options on City Businesses

A consolidated net profits occupational license tax would slightly reduce the tax liability for

pharmacies, and convenience stores while durable goods wholesalers and manufacturerswould see a slight increase. Auto repair shops would see a significant net reduction in theirtax liability. The same tax levied on gross receipts, however, would increase the burden onmanufacturing firms and wholesalers, while significantly lowering the burden forpharmacies, auto repair shops, and convenience stores.

Under the second option, business with larger numbers of employees such as manufacturingfirms, pharmacies, and durable goods wholesalers would all see a decrease in their business

tax bills. Smaller businesses such as auto repair shops and convenience stores would seesignificant jumps in their business tax liabilities. However, these effects can be mitigated bycharging small businesses a license tax rate well below the average, while charging larger

Net Profit2 Number of

Employees3

Current

Business

License & Net

Profits

(Earnings) Tax

Liability

Option 1A:

Consolidated

Net Profits

Occupational

License Tax

(2.014%)

Option 1B:

Consolidated

Gross Receipts

Occupational

License Tax

(.071%)

Option 2:

Graduated

Structure by

Business Type

(Average tax=

$946)

Option 3: Ad

Valorum Levy on

Gross Receipts

(.019%)

Business 1:

Manufacturing Firm$479,612 37 $7,796 $9,659 $10,304 $5,742 $7,558

Business 2:

Pharmacy$178,003 28 $4,030 $3,585 $3,824 $2,726 $2,805

Business 3:

Durable Goods$527,783 17 $6,778 $10,630 $11,339 $6,224 $8,317

Business 4: AutoRepair Shop

$17,354 6 $849 $350 $373 $1,120 $273

Business 5:

Convenience Store$25,667 4 $582 $517 $551 $1,203 $404

2Assumed to be 3.3% of pre tax gross receipts, the national average ratio of corporate profits to income based on 2007 Census and BEA Data.

1Reflects total inflation adjusted gross receipts f or each St. Louis industry sector in 2002 and the projected number of for-profit business establishments in

2010, based on historical Census Bureau data.

Tax Poli

y



13.

As detailpropertyCity’s h

tit

•Revecon

•City

•Wou

•Wouequ

•Theprofi

•Adonet

• Not lsam

•Wou

aise Prope

ed earlier,taxes of aneavy reliai

nue neutral, yomic competit

code and city

ld change co

ld increase holly

business licents taxation mig

ting a by busirofits tax or c

ikely to have se

ld broaden tax

ty Tax Mil

t. Louis rey comparabce on the

it

et could haveiveness

oter approval

Impac

pliance requir

rizontal equity

se tax has beeht make tax re

E

ness type strunversion to a

ignificant econ

base to includ

lage Rate

eives the le city and

earningst i

Additional

additional reve

Required

on Citizens

ments for bus

by treating bu

Reliabil

n a stable, butvenues more

ase of Adop

ture would incross reciepts

Econo

omic impact,

Balanced

e business gr

west percelso had ontax and it

th Cit ’

evenue Pot

nue potential

Statute Cha

/Businesse

inesses, lead

Equity

inesses with

ity/Sufficien

slow growingensitive to ch

tion/Admini

rease overalllevy would like

ic Efficienc

s the aggrega

or Broad-ba

ss or net rece

tage of Geof the low

s negativeth b

ential

ased on futur

nge

/Developer

o higher tax li

large and sm

y

source of revenges in the b

stration

dministratively reduce over

y

e tax liability

sed

ipts

neral Fundest equalizimpact o

d b d t

growth from

bilities for larg

all numbers of

nue. A shift tosiness cycle

ost. Consolidall administrati

n business sh

evenue frod rates. Th

the Cityt k t

nhanced

er businesses

employees

gross or net

ation with theve cost

ould remain th

es

e

Tax Poli y



The Citycap forCity cou

City belaveragetax bill, r

• $8.5

• City

•The

•Whilregr

•The

•The

•Thesligh

•Thisbroa

rate is curity generald generate

ow the HaSt. Louis hepresenting

million over t

code and city

increase woul

e the increasessive and ma

property tax h

administrative

property tax htly adverse im

is an existingd-based, but it

ently 2.624purposes.

approximat

cock cap,meowner,91

a 16.3 perc

o years

oter approval

Imp

fall on all rea

would affect anegatively im

s been the Cit

and collection

s the least ecpact on proper

ax so increasiwould help to

mills per $Based on aly $8.5 mill

and remainthis wouldnt increase.

Additional

Require

act on Citizen

l and personal

ll property ownpact vertical e

Reliabi

y's most relia

Ease of Ado

methods are

Econo

nomic impactty values abse

Balanceng the rate willrebalance the

1,000 of asannual in

ion in recur

competitivrepresent a

Revenue Pot

Statute Cha

s/Businesse

property owne

Equity

ers, the propequity

lity/Sufficien

le revenue so

ption/Admini

lready in plac

mic Efficienc

associated wint any other c

or Broad-banot make theCity's current

sessed valurease of onring Genera

e with co$49 increa

ntial

ge

/Developers

rs in the City

rty tax is gene

y

rce over time

tration

y

h it, however,anges to the

sedCity's revenueevenue mix

tion belowe mill for tl Fund reve

parable citie in the an

ally believed t

an increase mity's revenue

structure mor

the Hancoco years, th

nue, keep th

es. For thual propert

be somewha

ay have astructure

balanced or

k ee

ey

t

Tax Policy



is commonly used in New Zealand, Denmark, South Africa, Kenya, Estonia, Taiwan, andSingapore. In addition, cities such as Canberra, Sydney, and Hong Kong also use some formof land value taxation. The approach has been endorsed by eight Nobel Prize winners and

both conservative and liberal economists as a more fair and equitable taxing method.Typically, the LVT is seen as a means of shifting the property tax burden away from lowerincome taxpayers while creating a climate more conducive to development activity.

Distributional Issues

Because of its realignment of the property tax base, the LVT tends to redistribute theproperty tax burden to different classes of property owners. Under the tax, property ownerswith larger plots of land bear a greater share of the property tax burden. In practice, the

burden of the tax tends to fall on higher-income residents, which tend to spend a largerportion of their income on land. Lower income property owners generally face reduced taxliabilities due to their ownership of single homesteads on smaller plots of land. In thisrespect, the LVT would be likely to make the City’s tax system less regressive. Largecommercial and industrial property owners are likely to bear more of the burden of the tax, asthey tend to have larger land parcels with parking and landscaping associated with theirproperties.

Imposition of the LVT in St. Louis might have an adverse impact on senior citizens andothers on a fixed income. If executed in concert with a reduction or phase out in the earningstax, it could increase the City tax burden on senior citizens, who often own properties withhigh market value but have low taxable incomes. However, a pure land value tax would alsolead to lower assessments and tax liabilities in blighted, decaying areas and higherassessments and liabilities in areas experiencing consistent increases in property values.

It is important to note that implementing a LVT will have different effects in different typesof cities. A study by Bowman and Bell (2008) found that in Dover, NH, a bedroomcommunity outside of Boston, the LVT would increase the liability on residential property



Tax Policy



encourage the more efficient use of land, discouraging sprawl and more expansivedevelopment. Land values are also seen as “unearned increments” that result from theactions of society, whereas structure improvements are largely the result of property owner

decisions. Land value taxation may provide a way to reclaim this socially-created value forthe public sector.95

A land value tax, unlike other taxes commonly levied by local governments, has no distortiveeffect on market behavior. As the supply of land in any city is fixed, the increased propertytax liability on land cannot shrink the property tax base and thus reduce future taxcollections. Since land ownership is a constant, the tax base is not sensitive to economicchanges in the business cycle, as is the case with the earnings and sales taxes. Thus the LVT

is an unavoidable tax, and collections should only be influenced by demand for City land andthe effectiveness of City collection efforts.

Under a pure land value tax, there is also little incentive to leave a property vacant or to holdit for speculative purpose. However, for certain properties, the LVT could cause such anincrease in the property tax liability that it would reduce the demand for land in a particularlocation and thus the value of the land itself. This could have the unintended consequence of discouraging development of vacant parcels. However, imposition of the LVT can alsoreduce the price of housing, making it more affordable for first-time buyers.

While LVT has theoretical appeal, there are practical issues that have limited its adoption inthis country. The land value tax is generally a departure from conventional tax policy as itnarrows, rather than broadens the tax base. The removal or reduction of the tax onimprovements can lead to significant increases in property tax liabilities for certain propertyowners. The split-value tax tends to be more costly to administer than the conventional

property tax on land and improvements. It requires that much attention be paid to the landvalue/improvements split and requires greater accuracy in land value assessments that canoften prove costly to achieve.

Tax Policy



Determining the appropriate land/structure split can also be a major issue in implementation.The appropriate split should be dictated by the composition of a city’s property tax base anddesired tax burden distribution outcomes. Municipalities in Australia and New Zealand have

used a ratio that represents a typical improvement to overall property value split. InPennsylvania, the land to improvements tax ratio has on average been about 4 to 1, althoughfor many years the cities of Pittsburgh and Scranton maintained a 2:1 ratio without difficulty.However, a ratio of 3:1 can be seen as a “golden mean” and was identified in Bowman andBell’s 2004 study as a ratio that minimizes the redistributive impact of the changes inproperty tax burdens. Since the determination of the land/improvement split is critical tocalculating the individual taxpayer liability, more assessment appeals are likely to be filed onthe basis of land value determinations. For this reason, it is best to undertake significant

efforts to ensure the accuracy of assessments and to adopt a land/structure tax ratio that isacceptable to the community at large.

One way to correct for the immediate effects of the tax is to phase it in over a period of time.This was generally the case in Pennsylvania, and it gave property owners a chance to adjustto the new tax method and gradually spread the burden of higher tax liabilities over a periodof time. Moreover, it spreads out the upfront administrative costs of the shift over a longerperiod and aligning them more with tax collections over time.

In addition, adequate measures should be put in place to protect homeowners from abruptincreases in property tax liabilities resulting from the change. One such measure is propertytax circuit breakers. Property tax circuit breakers are mechanisms that identify or pinpointwhen property taxes, as compared to income, are excessive and thus reach a thresholdconsidered to be burdensome to the homeowner. The threshold is usually determined as aratio of property taxes paid to household income, or as a set income ceiling. The tax liability

is then capped to a certain percentage of household income. This option reduces property taxliabilities to a manageable level, mitigating the more severe effects of the shift on City homeowners.

Tax Poli

y



15. B

The Citrevenue

it has beearningsjobs, resi

•$20

•Stat

•Wou

•Wouown

•Thepatt

•Thermor

•Theadv

•Shift

egin a Pro

’s earningsrom non-re

n documentax has sevdents, and

million annuall

constitution,

ld shift propert

ld increase vrs of larger p

property tax hrns of propert

e would be inprecise asse

property tax hrse impact on

would narrow

ram of Inc

tax is an isidents due

ed in the exral negativealth movi

y

state statute, c

Imp

y tax burden a

rtical equity brcels of land

s been the Citvalue growth

reased adminisments of lan

s the least ecproperty value

City's property

emental R

mportant rto its status

perience inimpacts. I

g out of th

Additional

Require

ity code and ci

ct on Citizen

way from resid

shifting great

Reliabiy's most reliain the City

Ease of Ado

strative costsvalue

Econo

nomic impacts.

Balance

tax base to m

eductions t

venue streas the econ

other citiest is likely tCity of St.

Revenue Pot

Statute Cha

ty voter appro

s/Businesses

ential and tow

Equity

r portion of pr

lity/Sufficiencle revenue so

tion/Admini

ssociated wit

mic Efficienc

associated wi

or Broad-ba

ostly land

the City’s

m that allomic center

nd in the aat these im

Louis.

ntial

ge

al

/Developers

ard commeric

operty tax bur

yrce over time,

tration

calculating th

h it, however,

ed

Earnings

ws the Citof the regio

ademic litepacts have c

l property own

en to higher-i

would be tied

e land/improv

the shift may h

ax.

to generan. Howeve

ature that thontributed t

ers

come propert

to long-term

ment split and

ave a slightly

er,

eo

Tax Policy



following table details the proportion of metropolitan employment in St. Louis and twocomparable cities with earnings taxes compared to three other comparable cities that do notimpose an earnings taxes:

Table 29: City Employment as a Percentage of Metropolitan Area Employment

1970 1980 1990 2000 2007Decline

1970-2007

AverageDecennial

Decline

St. Louis 25.8% 16.9% 13.9% 10.5% 11.2% -56.6% -25.4%

Kansas City 41.0% 33.4% 27.1% 23.7% 21.3% -48.2% -16.7%

Baltimore 43.5% 31.0% 25.9% 20.4% 20.7% -52.5% -22.2%Average EarningsTax Cities

36.8% 27.1% 22.3% 18.2% 17.7% -51.9% -20.8%

Omaha 68.0% 54.3% 52.7% 53.2% 44.5% -34.5% -7.4%

Knoxville 44.5% 59.7% 26.3% 24.4% 27.0% -39.3% -9.7%

Minneapolis 25.8% 17.7% 14.5% 12.8% 11.3% -56.2% -20.5%

Average Non-Earnings Tax Cities

46.1% 43.9% 31.1% 30.1% 27.6% -40.1% -12.4%

The averages between the earnings tax cities and the non-earnings tax cities reveals a cleardistinction between the two groups, as cities that do not have an earnings tax retain asignificantly higher proportion of the metropolitan area employment compared to theearnings tax cohort.

Despite this impediment, the City of St. Louis has shown recent signs of progress ingenerating job and income growth through the use of tax incentives and leveraging state

programs such as the historic preservation tax credit. This momentum is further aided by agrowing nationwide movement toward urban living, characterized by a growing preferencefor walkable communities, transit, cultural venues, and other urban amenities the City offers.

Tax Poli

y



potentialattractiv

The reduapproachcurrent emoderniof 20-25logical fito adjuseconomi

•$36.City

•City

•Wouprov

•Mayservi

•Redopti

•Adm

residents tplace to li

ction progrmight not

conomic de and augpercent (i.

rst step. Thits approaand budge

4 million estimleadership poli

code

ld reduce overiding an incent

reduce horizoices

ction would fns

inistrative cost

hat the Cite and work.

am could tastart immewnturn andent its reve. a reducti

e City willch to eithetary conditi

ated in FY201icy choices an

Imp

all tax burdenive to invest in

ntal equity as

rce the City to

s would be mi

y is seriou

ke severaldiately, toafter the C

nue strucutn from 1.eed to closwithhold

ns change.

Redu

(based on 0.economic co

Required

ct on Citizen

on all employethe City

on-residents

Reliabi

replace reven

Ease of Ado

imal as tax al

about ma

orms, in tellow the City receivesre. At that0 percent tly monitor

planned re

ced Revenue

5% reductionnditions

Statute Cha

s/Businesses

d St. Louisans

Equity

ho work in th

lity/Sufficienc

ue from altern

tion/Admini

eady exists

king itself

ms of the tity’s econoauthority tpoint, initi

o 0.80 or 0the status ouctions or

to 0.75%); furt

ge

/Developers

and City-bas

City would c

y

tive sources

tration

a more co

iming and smy to reboo enact othl reduction.75 percentthe prograaccelerate

her reductions

d businesses

ntribute less t

r from addition

petitive an

tructure. And from thr changes tin the ranwould beand be su

eductions

based on

in addition to

public

al revenue

d

neoeaes

Tax Policy



City leadership could examine expanding the existing payroll expense tax to largenon-profit entities that are currently not subject to the tax

The City could opt not to make any changes to the existing payroll tax structure

Elimination of the Payroll Expense Tax

St. Louis is the only city in the metropolitan region with a payroll expense tax which, inaddition to the earnings tax, has made the City less attractive compared with surroundingmunicipalities. This situation has required the City to be aggressive in its attempts topreserve its existing employers through the use of tax incentives or other measures whichmay erode revenue streams. The elimination of the payroll expense tax would serve as asignal to the business community that the City is becoming a more hospitable place to

operate. Obviously, there would be a cost associated with this decision, as the City isprojected to generate $36.9 million in FY2010 from the payroll expense tax. However, as theCity considers different ways to shift its revenue structure away from those taxes that have anegative impact on economic growth, it should consider eliminating the payroll expense tax.

Expand the Payroll Expense Tax to Large Non-Profits

The payroll expense tax exemption of non-profit employers creates a more pronounced taxburden on for-profit employers who pay property taxes in addition to the payroll expense tax.

The obvious tax advantages (or disadvantages to for-profit enterprises) may help to explainwhy the three largest employers in the City are non-profit entities, and six of the top tenemployers are non-profit or governments.97

Establishing some type of PILOT payments from non-profit entities is discussed in-depth inthe Other Non-Tax Revenues chapter, the City may also want to consider an alternativeapproach of extending the existing payroll expense tax to larger non-profit employers. TheCity could choose to exempt certain smaller non-profit entities that may find the tax increase

onerous in light of the services or role they play in the community. However, colleges anduniversities and hospitals could be considered. These entities do not pay property taxes, andin some cases represent a large portion of the City’s real estate While there may be some

Tax Poli

y



Retain th

The Citychoose t

alternati Conclusi

City polincludinlarge noto the miwould li

ultimatelCity lead

•$36.

•$8.3

•City

• If thmak

•Exte

• An e

for-p

e Existing

may decido retain th

e changes t

on

icymakerseliminatio

-profits togration of jely have a

y be deterership puts

9 million reduc

million in addi

code; City vot

tax were elime the City mor

nsion of the ta

xtension of th

rofit business

ayroll Expe

that change existing

o its revenu

hould consof the taxake the str

obs out of positive im

ined by thforward.

tion estimated

tional revenue

rs

Imp

inated it wouldattractive to

x to large non-

tax would inc

s which all be

nse Tax Str

es to the pastructure d

structure.

ider seriousto reduce tcture moret. Louis, anact. Whic

scope and

Reduced/A

in FY2011 to

to extend the t

Required

ct on Citizen

reduce the buusiness and d

profits may im

rease horizont

efit from publi

Reliabi

cture

roll expense to its fa

changes te businessequitable.d changespayroll ex

goals of th

dditional Rev

liminate the t

ax to hospital

Statute Cha

s/Businesses

siness tax burevelopers

act non-profi

Equity

al equity as no

c services

lity/Sufficienc

e tax are unmiliarity a

the payroax burdenhe existings part of a

pense optio

e revenue a

enue

x

and universiti

ge

/Developers

den on for-pro

entities' incen

n-profit entitie

y

desirable atd its desir

ll expenser extensionstructure h

broader taxis best for

nd tax stru

es

it St. Louis bu

tive to invest i

would be trea

the time ane to explo

ax structurof the tax ts contributereform effothe City wi

ture chang

inesses and

the City

ted similarly t

de

,odrtll

s





Tax Policy



Goods and Services Tax

Category Type Revenue Option DescriptionCollecting City

Department

Municipality with

Revenue Source

Goods and

Services TaxFuel Tax Motor Fuel Tax Tax imposed on purchase of motor fuel Collector of Revenue New York, NY

Goods and

Services TaxFuel Tax

Petroleum

Products Receipts

Tax

Imposed on companies engaged in refining /

distributing petroleum products, based on gross

receipts

Collector of Revenue State of New Jersey

Goods and

Services TaxLiquor Tax

Alcoholic

Beverage/Liquor

Tax

Tax on per glass consumption of beer, w ine, mixed

beverages, and liquorExcise Division Chicago, IL

Goods and

Services TaxLiquor Tax

Malt Beverage

(Beer ) Tax

Tax levied on malt or brew ed beverages, tax

depends on sizeExcise Division Atlanta, GA

Goods and

Services Tax

Occupational

License Fee

Insurance

Premium Tax

License tax on the amount of premiums w ritten by

insurance companies doing business w ithin the cityCollector of Revenue Florence, KY

Goods and

Services TaxParking Tax

Employee Parking

(per month)Monthly parking fees for airport employees Airport Authority Denver, CO

Goods and

Services TaxParking Tax Airport Parking Tax Special tax imposed on airport parking Airport Authority Denver, CO

Goods and

Services TaxTransfer Tax Recordation Tax

Paid on property that is transferred (bought/sold)

from one entity to another. Based on value of

property, meant to recoup cost of maintaining and

updating property records

Collector of Revenue Alexandr ia, VA

Goods and

Services Tax

Transfer

Tax/Fee

Real Estate

Transfer TaxTax based on purchase price on sale of real estate Collector of Revenue Chicago, IL

Goods and

Services TaxUtility Tax

Electric Universal

Service Charge

Tax imposed on energy customers to provide energy

to low -income customersCollector of Revenue State of Maryland

Tax Policy



Licenses and Permits


Department

Municipality with

Revenue Source

License or

Permit FeeAnimal License Fee

Multiple Pet License

Fee

License fee to maintain multiple pets in a single

residence

Animal Care and

ControlLouisville, KY

License or

Permit Fee

Development and

Impact FeesImpact Fees

Special development fees charged for the

impact on roads, parks, libraries, f ire, police,

and general government

Building Division Phoenix, AZ

License or

Permit Fee

Development and

Impact FeesTelecom Tow er Fee

Fee charged for construction or installation of

telecommunications tow ers

Communications

DivisionOak Hill, TN

License or

Permit Fee

Development and

Impact FeesGrading Perm its

Permit f ee based on estimated costs of grading

and soil erosion and sediment control w ork

performed

Building DivisionSnohomish County,

WA

License or

Permit Fee

Development and

Impact FeesGas Burner Perm it Fee

Mechanical permit fee to install a gas burner on

a propertyBuilding Division Minneapolis, MN

License or

Permit Fee

Development and

Impact FeesFence Permit Permit fee to erect a fence on a property Building Division New Prague, MN

License or

Permit Fee

Development and

Impact Fees

Construction Trailer

Permit FeePermit fee to set up a construction trailer Building Division Gresham, OR

License or

Permit Fee

Development and

Impact Fees

Gas Water Heater

Permit Fee

Mechanical permit fee to install a gas w ater

heater on a propertyBuilding Division Gresham, OR

License or

Permit Fee

Development and

Impact Fees

Gas Fireplace Permit

Fee

Mechanical permit fee to install a gas fireplace

on a propertyBuilding Division Gresham, OR

License or

Permit Fee

Development and

Impact FeesFurnace Permit Fee

Mechanical permit fee to install a furnace on a

propertyBuilding Division Gresham, OR

License or

Permit Fee

Development and

Impact Fees

Condominium

Conversion Permit Fee

Permit f ee to convert a property into

condominium unitsBuilding Division Gresham, OR

License or

Permit Fee

Development and

Impact Fees

Solar Access Permit

Fee

Permit fee for protecting solar access to a

solar energy systemBuilding Division Gresham, OR

License orPermit Fee

Inspection ImpactFee

Fuel Dispense r Perm itFee

Permit fee to install a high speed fuel dispenseron a vehicle

Fire Department Pelham, NY

License or Occupational Weights and Measures Licensing fee on dealers and repairers ofLi C ll t O l k WI

Tax Policy



Licenses and Permits


Department

Municipality with

Revenue Source

License or

Permit Fee

Occupational

License Fee

Trespass Towing

Registration Fee

Registration fee for tow serv ices that perform

trespass towingLicense Collector Howard County, MD

License or

Permit Fee

Occupational

License Fee

Solicitor and Peddler

Registration Fee

Annual registration fee to operate as a

solicitor, peddler, or canvasserLicense Collector Elma, NY

License or

Permit Fee

Occupational

License Fee

Amusement Device

Fee

Annual fee f or operation of an amusement

device such as a pool table or coin-operated

machine

Excise Division Ferndale, WA

License or

Permit Fee

Occupational

License Fee

Restaurant License

Fee

Annual licensing fee to operate as a dining

establishmentLicense Collector District of Columbia

License or

Permit Fee

Occupational

License Fee

Ice Cream Vendor

Truck Fee

Annual license fee to operate an ice cream

truck Department of Health Pelham, NY

License or

Permit Fee

Occupational

License FeeFireworks Permit Fee Permit fee to operate as a firew orks vendor License Collector Covington, WA

License or

Permit Fee

Occupational

License Fee

Precious Metal Dealer

Licensing Fee

License fee for persons buying second-hand

precious metal (gold, silver, platinum) pieces. License Collector Duluth, MN

License or

Permit Fee

Occupational

License Fee

Wine Dealer Licensing

Fee

Annual license fee levied on w ine-dealing

establishments and individualsExcise Division Huron, SD

License or

Permit Fee

Occupational

License Fee

Auctioneer Licensing

Fee

Annual license fee to operate as a

profess ional auctioneerLicense Collector Anoka County, MN

License or

Permit Fee

Occupational

License FeePet Shop License Fee

Annual license fee to operate a commercial pet

shopLicense Collector Robbinsdale, MN

License or

Permit Fee

Occupational

License FeeCircus License Fee License fee to operate a circus in the city License Collector Hartford, WI

License or

Permit Fee

Occupational

License Fee

Kennel or Cattery

License Fee

Annual license fee to operate a dog kennel or

catteryLicense Collector Orono, MN

License or

Permit Fee

Occupational

License Fee

Bowling Alley License

FeeAnnual license Fee to operate a bowling alley License Collector Battle Creek, MI

License or

Permit Fee

Occupational

License Fee

Limousine Permit FeePer vehicle to permit fee to operate a limousine

service

License Collector Battle Creek, MI

License or

Permit Fee

Occupational

License Fee

Limousine

Replacement Tag FeeFee to replace an existing limousine permit tag License Collector Battle Creek, MI



Tax Policy



Property Taxes


Department

Municipality

with Revenue

Source

Property

Tax

Non Profit

Tax/FeePILOT

Payments in lieu of taxes negotiated w ith

non-profits (hospitals, schools, churches,

etc.) that receive city services but pay

property taxes.

Collector of Revenue Philadelphia, PA

Property

Tax

Personal

Property TaxAirplane Tax

Special personal property tax levied on

aircraftCollector of Revenue

Stafford County,

VA

Property

Tax

Personal

Property Tax

Machinery and Tool

Tax

These are levied on all machinery and tools

used in manufacturing, mining, radio, and

television broadcasting, cable television, dry

cleaning or laundry bus iness.

Collector of Revenue Richmond, VA

Property

Tax

Personal

Property Tax

Recreational Ve hicle

Tax

Additional tax on recreational vehicles and

outdoor recreation vehiclesCollector of Revenue Overland Park, KS

Property

Tax

Personal

Property TaxWatercraft Tax Special personal property tax on w atercraft Collector of Revenue Radcliff, KY

Property

Tax

Personal

Property TaxWheel Tax

Per passenger vehicle w ith a graduated

schedule for larger vehiclesCollector of Revenue Omaha, NE

Property

TaxReal Estate Tax

Real Estate Non-

Utilization Tax

Tax based on assessed value of vacant

real estateCollector of Revenue

East Providence,

RI

Property

TaxReal Estate Tax

Public Improvement

Frontage Fee

Special assessment, on a one time or

annual basis for public improvements

abutting an aff ected property

Collector of Revenue Minneapolis, MN

Property

TaxReal Estate Tax

Street Light

Assessment

Direct benefit assessments on neighboring

properties funding maintenance, operation,

and improvements to street lighting.

Collector of Revenue Cincinnati, OH

Property

TaxReal Estate Tax

Land Value Property

TaxTax based on property value of land Collector of Revenue Fairhope, AL

Tax Policy



Charges for Services


Department

Municipality

with Revenue

Source

Charge for Service Airport FeeCommer cial Vehicle

Lane Fee

Per trip fee levied on commercial vehicle

traffic lane drop offsAirport Authority Denver, CO

Charge for Service Airport Fee

Common Use

Term inal Equipment

Fee

Fee levied on resident air carriers for use of

terminal equipmentAirport Authority Denver, CO

Charge for Service Airport FeeConcourse Ramp

Area Rental Fee

Fee levied on air carriers for use of

concourse ramp areaAirport Authority Denver, CO

Charge for Service Airport FeeInternational

Facilities Charge

Per passenger fee charged for use of

airport international facilitiesAirport Authority Denver, CO

Charge for Service Airport FeeBaggage Claim

Facilities Charge

Per passenger fee charged for use of

airport baggage claim facilitiesAirport Authority Denver, CO

Charge for Service Airport FeeTicket Counter Use

Charge

Fee levied on air carriers for use of airport

ticket countersAirport Authority Denver, CO

Charge for Service Airport Fee Apron FeeAnnual per unit fee for use of passenger

loading gatesAirport Authority Denver, CO

Charge for Service Airport Fee Baggage System Fee Charge for lease of baggage system Airport Authority Denver, CO

Charge for Service Airport FeeInterline Bag

Transfer Area Fee

Fee levied on air carriers for use of inter-

airline baggage transfer areaAirport Authority Denver, CO

Charge for Service Airport FeeCargo Facilities

Charge

Annual per square foot fee for use of airport

cargo f acilitiesAirport Authority Denver, CO

Charge for Service Airport Fee Ground Handling FeeFee levied on ground handling of luggage

and freightAirport Authority Denver, CO

Charge for Service Airport FeeCourtesy Booth

Rental

Daily charge on vendors for use of airport

courtesy boothsAirport Authority Denver, CO

Charge for Service Airport FeeSecurity Screening

Fee

Per passenger charge for use of security

screening f acilitiesAirport Authority Denver, CO

Tax Policy





Department

Municipality

with Revenue

Source

Charge for Service Correctional FeeDaily Inmate Jail Fee

for Room and Board

Daily fee charged to inmates in city

correctional facilities f or room and boardCorrections

Ashland

County, WI

Charge for Service Correctional Fee Fingerprint Fee

Process ing fee f or f ingerprinting levied on

inmates or other persons needing

fingerprinting services

Police DepartmentColorado

Springs, CO

Charge for Service Correctional FeePhotograph

Development Fee

Processing fee for photograph development

levied on inmatesPolice Department Battle Creek, MI

Charge for Service Court FeeDeferred

Prosecution Fee

Fee charged for the temporary deferral of

criminal proceedingsCity Courts

Eau Claire

County, WI

Charge for ServiceDevelopment and

Impact Fee

Stormwater

Management Fee

Property-based fee based on the average

stormwater runoff from various land use

types w ithin the City and on property size

Collector of

RevenueOak Creek, WI


Impact Fee

Sewer Connection

Fee

Fee paid to the city prior to connection to the

sanitary sew er systemBuilding Division Watertow n, WI


Impact FeeDevelopment Fee

Fee imposed on new developments to assist

w ith the cost of essential municipal services

related to residential development

Building DivisionMartinsburg,

WV


Impact FeeAdvertising Fee

Fee levied to recover the cos t of advertising

for development-related public hearingsBuilding Division New port, RI


Impact Fee

Developer Drainage

Fee

Per unit storm drainage fee charged on new

developmentsBuilding Division Kent County, MI


Impact Fee

Wireless Facilities

Professing Fee

Process ing fee for applications f or

collocation of w ireless facilitiesBuilding Division South Gate, CA

Charge for Service EMS Fee 911 SurchargeCharge added to resident's phone bill to

defray cost of 911 servicesCEMA Lincoln, NE

Charge for Service EMS Fee911 Surcharge (cell

phones)

Charge added to resident's phone bill to

defray cost of 911 serv ices, on cell phonesCEMA New York, NY

EmergencyFee to cover cost of police fire, and EMS

personnel responding to an accident caused CEMA Police Fire

Tax Policy





Department

Municipality

with Revenue

Source

Charge for ServiceMedical Examiner

Fee

Cremation

Authorization Fee

Charge for a coroner's authorization to

cremateMedical Examiner

Dodge County,

WI

Charge for Service Police FeeWarrant Pickup

ChargeSpecial charge for w arrant pickups Sheriff's Office

Columbia

County, WI

Charge for Service Police FeeIndustrial Pre-

treatment Surcharge

Surcharge levied on businesses that emit

w astew ater containing an excessive

amount of pollutants

Water Division Fargo, ND

Charge for Service Police Fee Blood Tes t Fee

Fee to cover cost of blood test on a person

under the influence of alcohol or a controlled

substance that causes an accident

Police Department Battle Creek, MI

Charge for Service Records FeeExpedite Vital

Records Fee

Fee charged to expedite a vital records

request

Recorder of

Deeds

Kenosha

County, WI

Charge for Service Records FeeCriminal History

Check Fee

Fee for criminal history checks required in

city license and certification applicationsLicense Collector Greendale, WI

Charge for Service Records Fee911 Tape

ReproductionFee for reproduction of a 911 tape Police Department

How ard County,

MD

Charge for Service Records FeePolice Report

Reproduction FeeFee for reproduction of police report Police Department Concord, CA

Charge for Service Records Fee Lien Search Fee Fee for a city-performed lien searchRecorder of

DeedsGresham, OR

Charge for Service Right of Way Fee

Right of Way

Maintenance

Assessm ent Charge

Charge for summer and winter street

services, snow plowing, sidewalk repair,

litter pickup, ordinance enforcement and

Collector of

RevenueSt. Paul, MN

Charge for Service Right of Way Fee Street Naming FeeFee to review an application to rename a

streetBuilding Division Gresham, OR

Charge for Service Sheriff's FeeSheriff Real Estate

Sale FeeService fee levied on Sheriff -arbitrated sales Sheriff's Office

Eau Claire

County, WI

Charge for Service Sheriff's Fee Foreclosure FeeFee charged to successful bidders on

foreclosed propertiesSheriff's Office

Fond du Lac

County, WI

Tax Policy



Other Revenue Options


Department

Municipality

with Revenue

Source

Other Revenue

OptionsFee Review

Asses s Adequacy of

Fees to Recover Costs

Review the degree currently charged fees recoup the

cost of serviceAll departments

Long Beach,

CA

Other Revenue

Options

Market-Based

Revenue

Market-Based Revenue

Options

This encompasses various entrepreneurial concepts,

including advertising, exclusivity arrangements, rental

agreements, and corporate sponsorships. This

includes general outdoor advertising, street furniture,

indoor advertising, etc.

Collector of

RevenuePittsburgh, PA

Other RevenueOptions

Property Sales Sale and Disposition ofSurplus Property

This encompasses various entrepreneurial concepts,

including advertising, exclusivity arrangements, rental

agreements, and corporate sponsorships. Thisincludes general outdoor advertising, street furniture,

indoor advertising, etc.

Supply Division Brentw ood, MO

Other Revenue

OptionsReal Property Tax

Real Proper ty Parcel

Taxes

Parcel taxes are assessed as a uniform amount per

property regardless of assessed value. While

regressive, the amount that can be raised can be

significant, and they are nearly always tied to a specific

project or purpose. Used extensively in California.

Collector of

RevenueParadise, CA

Other Revenue

OptionsSales Tax

Public Improvement Fee

(PIF)

Similar to a retail sales tax, the f ee is charged to retail

customers and the revenue is used to pay debt service

on bonds to build public improvements.

Collector of

RevenueLakewood, CO

Other Revenue

OptionsSales Tax

Streamlined Sales Tax

Initiative (collecting

taxes on Internet sales)

Sales taxes on online purchases.Collector of

Revenue

State of North

Carolina

Other Revenue

OptionsSales Tax Sales Tax on Services Expansion of sales tax to services

Collector of

RevenueHonolulu, HI

Other RevenueOptions

Tax-BackedFinancing

Revenue AnticipationNotes (RAN)

Governments are able to issue tax exempt notes f or

cash flow purposes. In many cases, this can yield

positive arbitrage that meets IRS regulations.

Comptroller'sOffice

Richmond, CA



Other Non Tax Revenues

Other Non Tax Revenue



Across the nation, citizens and voters have exhibited increased resistance to broad-based taxesand fees. As a result, governments have sought other opportunities to raise revenue beyondtaxes, licenses, or charges for services. In many instances, these revenue sources capitalize on

city assets; in other instances, it reflects the need to obtain assistance from key portions of thecommunity or metropolitan area that otherwise do not share in the cost of maintaining importantcity services.

Examining these opportunities for additional revenue generation from non-tax sources focuseson innovative revenue options used by cities across the nation that do not require additionalcontributions from city taxpayers. This overview will concentrate on two specific revenueoptions, payments in lieu of taxes and market-based revenue opportunities. Based on an analysis

of other cities’ experience, we believe that they may provide significant additional revenue forthe City of St. Louis.

Payments In Lieu of Taxes

Introduction

Payments in lieu of taxes (PILOTs) are payments to a local government from entities that arenormally exempt from other taxes, particularly property taxes. They are most commonly madeby nonprofit organizations, such as universities, hospitals, foundations and publicly-ownedutilities. In addition, other governmental entities, including convention authorities or schooldistricts, often negotiate payments to the city as a reimbursement for services. Finally, both stateand federal governments have entered into PILOT agreements with other cities around thecountry. In many cities, PILOTs provide an effective method to recover the cost of city servicesprovided to the institutions and reduces taxpayer subsidization of these organizations’ operations.

Property Tax Exemption in St. Louis




The NFP organizations operating within the City include three universities, four colleges, twelvehospitals, as well as numerous religious organizations and charitable foundations. Theseorganizations own residential, commercial, personal property and manufacturer’s machinery,

tools, and equipment property. The following figure shows the percentage of tax exempt andtaxable property in St. Louis:

Figure 15: Distribution of Assessed Property Value*

*Note: Data is based on the FY2008 St Louis Comprehensive Annual Financial Report.

According to the City Assessor’s latest estimates, in 2008, St. Louis had approximately $4.46billion in assessed value of taxable residential, commercial, and manufacturer’s equipmentproperty. Of that amount, $1.28 billion was assessed value associated with NFP organizations.

This represents 22 percent of total assessed valuation.

This breakdown is shown in the following figure:

Tax Exempt22.0%

Taxable78.0%




notable that the three largest employers in St Louis are NFP organizations, and they account for asubstantial portion of the City’s assessed property valuation. In 2007, these three NFPs – BJCHealth Systems, Washington University, and St. Louis University – employed over eight percent

of the City’s workforce.

Among comparable cities that report tax exempt property value, St. Louis has a relatively highproportion of total property value owned by tax exempt entities, as shown in the following table:

Table 30: Comparison of Tax Exempt Property Value – FY2008101

Tax ExemptProperty Value

Total PropertyValue

Tax Exempt %

of TotalProperty Value

St. Louis $1,283,851,000 $5,841,034,000 22.0%

Baltimore $9,818,578,020 $36,451,265,431 26.9%

Knoxville1 $213,839,000 $9,844,269,000 2.2%

Minneapolis2 $8,465,785,000 $45,562,351,000 18.6%

Pittsburgh $7,777,749,000 $21,032,626,000 37.0%

AVERAGE $6,568,987,755 $28,222,627,858 21.2%

DIFFERENCE FROMAVERAGE (%)

-80.5% -79.3% 3.8%

1Includes real property only.2Numbers are for

FY2007

Among comparable cities that report this information, only Baltimore and Pittsburgh have largerproportions of tax exempt property. Overall, St. Louis ranks above the average for comparablecities.

Case Studies




Boston, MA

The City of Boston has a PILOT program that focuses primarily on tax-exempt institutions that

are expanding - either through new construction, rehabilitation, or acquisition. The voluntaryprogram was designed to recover a portion of property taxes lost from buildings and land ownedby tax-exempt organizations.

103Contributions are expected to cover municipal services normally

covered through property taxes, such as street cleaning and public safety.104

Under Boston’s program, the City initiates discussions with a nonprofit organization based on aformula that considers proposed project costs, the assessed property value, and an evaluation of similar structures. This initial estimate is used as a starting point for discussions with nonprofit

institutions on the final value of the PILOT agreement.105 Contracts include escalator clausesthat increase contributions annually through the life of the contract based on the U.S. Departmentof Commerce’s Implicit Price Deflator for State and Local Government.106

Under its PILOT program, Boston has reached agreements on payments from major cityhospitals, universities, and regional authorities. The agreement with the Massachusetts PortAuthority (Massport) is the most significant source of revenue. In FY2009, Massport willcontribute $16.2 million to the City. In addition, Boston will receive $14.4 million in payments

in lieu of taxes from other nonprofit entities, including $8.6 million from educational institutionsand $5.5 million from medical institutions.107

Madison, WI

As the state capital and home to a major state university, the City of Madison’s property taxcannot be applied to a large portion of its assessed value. Tax exempt entities ownapproximately 38 percent of the assessed property value within the city. Madison has long usedPILOT agreements as a way to recoup property tax revenue from these properties. In FY 2009,PILOT payments from various community organizations were anticipated to add $6.2 million to




Madison also has agreements with other nonprofit institutions. These include:

Overture Center for the Arts ($498,400)

Monona Terrace, Community and Convention Center ($303,800) Community Development Authority contributing ($237,500) and, Golf Enterprise ($130,600)108

Additional PILOT contributions are received from the Ho-Chunk Nation, the Fluno Center forExecutive Education, the Wisconsin Housing and Economic Development Authority, OakwoodWest Continuing Care Retirement Communities, as well as various other nonprofits. In thecoming fiscal year, Madison also anticipates receiving as much as $810,000 from the University

of Wisconsin Hospital.109

Pittsburgh, PA

Since its founding in 1758, the City of Pittsburgh had a long history of robust economic growth.However, in the early part of the decade, Pittsburgh fell on hard times, and in late 2003 the Citywas designated as a ‘distressed’ city under Pennsylvania’s Municipalities Financial RecoveryAct. On the verge of financial collapse, Pittsburgh was forced to look for new sources of

revenue. One of the methods to assist the City was a new Public Service Fund to collectcontributions from the numerous universities, health care facilities, foundations and other non-profit organizations in the City. While voluntary, contributions from non-profit institutionsincreased from approximately $0.6 million in 2003 to $5.2 million in 2007. The contributionsranged from $100 from the city YMCA to $1.5 million from the Pittsburgh Medical Center. 110

The Public Service Fund was anticipated to receive collections for the PILOT program from2005 through 2007. At the end of 2007, the partnership was dissolved and the Mayor’s Officetook the responsibility for renegotiating a new agreement for nonprofit contributions. Noagreement has been reached at this point, but a renewed agreement is planned. 111




million in contributions to the City of Providence over 20 years.112 These payments wereestimated to total about $3.8 million annually, representing just under one percent of FY2008General Fund revenue.

113There are three components to the agreements. The first is voluntary

payments for 20 years for property already owned, with payments growing at 1.5 percentannually. There are also provisions for fixed payments for certain properties purchased by theschools around the time the agreement was reached. The final component is transition planpayments for properties purchased and taken off the tax register during the lifetime of theagreement.

Cambridge, MA

The City of Cambridge’s PILOTs experience began in 1928, when the Massachusetts Institute of Technology (MIT) acquired valuable land along the Charles River. Cambridge, concerned withthe erosion of its property tax base from MIT’s expansion, negotiated a PILOT agreement withthe institution to compensate for the loss of taxes. Since then, Cambridge has negotiated withnumerous colleges and universities in the city on a case-by-case basis.

114These efforts are

coordinated through the Mayor’s Office, in consultation with other City departments.Cambridge receives approximately $3.3 million annually from PILOT agreements.

In 2005, the City negotiated a 40 year pact with MIT. The agreement was expected to total atleast $101.4 million and included an escalator clause increasing contributions by 2.5 percent peryear. Harvard University later entered into a 50 year agreement with Cambridge consisting of anannual payment of $1.7 million with 3.0 percent annual increases. Additionally, the agreementstipulates a base increase of $100,000 each decade and a one-time payment of $1.0 million atinception. The total package was expected to be $209.0 million over 50 years.

PILOT Opportunities in St Louis

As large property owners and major regional employers, tax-exempt organizations have a




PILOT Agreement Options

Cities adopt various approaches to seek assistance; this sometimes depends on state statutory

restrictions. As a ‘carrot and stick’ method, the City could seek to impose a municipal servicesfee on these institutions. In some cities, this is a broader fee that covers services for cityresidents and/or businesses, with property tax payments used as an offset to the fee.

While this has been found to be legally acceptable in some jurisdictions, it can lead to anadversarial relationship between the City and key stakeholders and costly legal expenses. It maylead to the relocation of some institutions to locations outside the City, although major hospitalsand universities are largely constrained by their prior investments in exercising this choice. It is

generally accepted that this forced type of reimbursement to the City may result in thedeterioration of City relationships with key community organizations and stakeholders.

Often, a preferable option is to create municipal services agreements. These identify the servicesprovided to the non-profit organization and the charges associated with providing the services.Although this is common in urban areas, negotiation and maintenance of these agreements canbe difficult. In practice, service agreements can be difficult to enforce, short in duration, andrequire significant time and effort to finalize such agreements. As a result, it can be difficult to

budget for them, as revenues associated with them tend to be irregular. Individual agreementscan also be perceived as unfair, as negotiated payments vary from institution to institution, withsome institutions not participating at all.

In instances where these agreements are negotiated, the amount of the annual payments can bedetermined by various methods. These include:

Flat annual payment; Payment based on the estimated property value and the current millage rates; Adjusted property valuation, which is the most common structure for agreements.




Table 31: Comparable PILOT Revenue

2008 2007

% of GFRevenues

TotalPILOTs

% of GFRevenues

TotalPILOTs

Baltimore1

0.43% $5,606,000 0.46% $5,917,724

Knoxville 7.27% $12,316,370 7.27% $12,021,740

Minneapolis 0.12% $427,229 0.12% $400,112

Norfolk 0.43% $3,476,967 0.43% $3,413,931

Omaha 2.23% $5,988,700 2.08% $5,448,575

Pittsburgh 0.99% $4,316,000 1.15% $5,169,566

AVERAGE 1.91% $5,355,211 1.92% $5,395,275

AVERAGE (excluding max)

0.84% $3,962,979 0.85% $4,069,982

12008 projected year end total.

Of the comparable cities, Minneapolis and Baltimore receive payments in lieu of taxes fromprivate nonprofit organizations. In Baltimore, the majority of PILOT revenue has come fromagreements with Johns Hopkins University and its extensive health system. Omaha, Baltimore,Knoxville, and Norfolk receive payments from other governmental entities, including public

utilities, housing authorities, and port authorities, as compensation for city services. Of thecomparable cities with PILOT programs in effect, on average, approximately $5.4 million inadditional revenues were realized in FY2008. However, this result is greatly influenced by thefact that Knoxville receives an unusual amount of PILOT revenue from its public utilities board.With this outlier removed, on average about $4 million in revenue is generated annually fromcomparable PILOT programs, accounting for 0.8 percent of General Fund revenue.

State PILOT Reimbursements

Some states, including Connecticut and Rhode Island, offer reimbursements to localgovernments for lost property taxes due to tax exempt organizations In Connecticut the State




While there is not a significant portion of state property in St. Louis, a lobbying effort inconjunction with other cities with a large presence, such as Columbia or Jefferson City, could

help adopt similar programs in Missouri. Given the current economic downturn has also had anappreciable impact on the state’s budget, this is probably better classified as a long-term solution.

PILOT Program Structure

There is tremendous variety in the structure of city PILOT programs. The following tablehighlights the types of PILOT programs that have been used in several states and localitiesduring this decade:

Table 32: PILOT Program Types

DescriptionExamples of Reimbursement Levels to

Localities

Private Colleges andHospitals

Reimbursement for City property tax losses due toreal property tax exemptions for private colleges andhospitals

77% reimbursement – Connecticut;

Individual agreements – New Haven, CT;Pittsburgh, PA, Wilkes-Barre, PA; Erie, PA;Cambridge, MA; Providence, RI

State-Owned Property

Reimbursement for City property tax losses due toreal property tax exemptions for state-ownedproperty; percentage reimbursement variesdepending on use of property

Connecticut - 100% for prisons/jails; 100% ifstate-owned property comprises more than 50%of the property within a municipality; 45% for mostother state-owned property and for municipally-owned airports

New ManufacturingMachinery and

Equipment

Reimbursement for City property tax losses due tolost revenue on manufacturing machinery andequipment exempt from taxes

Connecticut – rising from 20% to 100% through2013, then capped at the 2013 amount

Elderly and Disabled

Reimbursement for lost revenue resulting fromproperty tax exemptions for elderly and disabledpersons

Connecticut - 100% reimbursement for state-mandated exemptions to property tax for elderlyand totally handicapped individuals




Conclusion

While there are various ways to solicit contributions from NFPs, the best plan likely involves

contact with local nonprofits to explain the need for assistance and to create long term,sustainable agreements. Local non-profits may be more willing to discuss ways in which theycan contribute if the City were to elect not to explore the extension of the payroll expense taxdescribed in Tax Policy chapter. One approach would be to begin with newly expanding entitieswithin the City, as was done in Boston. These agreements would be long term and regain thelost real estate taxes from the land and buildings recently acquired by the tax exempt institutions.Through developing good relationships, it is more likely that local non-profit entities will bewilling to enter into long term agreements with the City for PILOT contributions.

To minimize further erosion of the property tax base from the growth and expansion of nonprofitinstitutions, the City should consider special agreements with new or expanding non profits togradually phase out tax payments on properties transferred from taxable entities to theseinstitutions. Continued tax payments by these institutions could be considered payments in lieuof taxes. This can reduce the immediate loss of revenue from these property transfers, whichoften has an effect on annual property tax revenues.

Revenue Potential

The revenue generation potential from individually negotiated PILOT agreements with the City’stax-exempt entities would be a function of the number and size of the tax-exempt entities withinSt. Louis, how many of those entities would be willing to enter into a PILOT agreement with theCity, and the size and structure of each entity’s payment obligation to the City. However, basedon the number of nonprofit institutions in the City and revenue yields from comparable cities, itis estimated that PILOT agreements with non-profit entities in the City of St Louis, after creationof a city-wide program, could raise as much as $5 million in new annual revenues.

The following City institutions are owned by governmental and nonprofit entities and arepossible candidates for PILOT contributions:


T bl C did f PILOT C ib i



Table 33: Candidates for PILOT Contributions

FederalColleges andUniversities

Hospitals State

Jefferson ExpansionNational Memorial116

WashingtonUniversity

Christian HospitalChouteau & ComptonState Office Building

St Louis UniversitySSM Depaul Health

CenterMill Creek StateOffice Building

Harris Stowe StateUniversity

St. Louis VA MedicalCenter – John Cochran

Prince Hall FamilySupport Center

Forest ParkCommunity College

St Louis ConnectCareWainwright StateOffice Building

St. LouisCommunity College

Barnes-Jewish Hospital St. Louis Central JobService

St Louis College ofPharmacy

SSM Cardinal GlennonChildren’s Medical

Center

Ranken TechnicalCollege

Forest Park Hospital

SSM St Mary’s HealthCenter

St Alexis Hospital

St. Louis UniversityHospital

St Louis Children'sHospital

Kindred HospitalSt Louis

BJC Health Systems, the City’s largest employer, owns three of the City’s major hospitals andwould be an excellent first candidate for an agreement. In addition, Washington and St. LouisU i iti l h j i th Cit d ld l b d did t f




Market Based Revenue Opportunities

Introduction

Market based revenue opportunities (MBROs) are agreements between cities and privatecompanies that provide payments for marketing and advertising using City property and assets.This broad term encompasses various entrepreneurial concepts, including advertising, exclusivityarrangements, rental agreements, and corporate sponsorships. These market the City’s assets,and if correctly implemented, can produce revenue streams that conform to community standardsand parallel the City’s plans for community and economic development. While some MBROopportunities, such as bus shelter advertising, are generally well established in the municipal

marketplace, many areas are still evolving. There are various types of agreements that may bereached that allow the City to partner with private companies and realize new City revenues.

Types of MBROs

The concept of MBRO encompasses various potential revenue generating projects that generallyfall within the categories of advertising, municipal market partnerships, street furniture,secondary real estate use, made-for-sponsorship packages, and athletic fields and recreationfacilities.

Partnership deals offer exclusive rights to a particular company or organization to provideservices within City-owned buildings. Most common are agreements negotiated with soft drink and snack food companies. These companies are given exclusive rights to sell their products invending machines, cafeterias and restaurants within City buildings, and at City events. As partof these agreements, the City may assert that a certain portion of the products offered fit withCity health requirements, such as offering fruit drinks and bottled water in addition to softdrinks. There are many ways to structure the revenues from these deals. A city may elect to

receive a percentage of profits or a flat operation fee per year for these privileges.

As food and beverage companies may be given exclusive rights to offer products other brands


I d d i i Ad i b l d i bli lib i i i



Indoor advertising. Advertisements may be placed in public restrooms, libraries, civiccenters, parking garages, and recreation venues.

General outdoor advertising. Billboards and other outdoor signage can generate both afixed rental payment and/or a share of gross advertising revenues. Revenue-generationpotential is mostly a function of location. A single prime billboard location can generatetens of thousands of dollars per year. Temporary ad banners on the fencing for publicconstruction sites may also provide revenue opportunities.

Other miscellaneous advertising. Advertisements can be placed on, for example,parking garage receipts or parking tickets, while subsidizing printing costs. Other

advertising options being pursued by municipalities nationally include: tax and utility billinserts; banners on municipal websites; advertising placements on the sides of rolloutrefuse carts used in conjunction with automated trash collection; vehicle advertising“wrap” arrangements; and advertisements on parking meter poles.

Street furniture. Advertising revenues can offset, or even eliminate, the costs of “streetfurniture” amenities such as bus shelters, benches, public toilets, newsstands, trashreceptacles, information kiosks, bicycle racks, and telephone pillars. Many cities around

the country have instituted street furniture programs supported by advertising includingBoston, MA, Hartford, CT, Los Angeles, CA, and Philadelphia, PA.

Secondary use of public real estate. City facilities and/or infrastructure can generatesupplemental revenues from options such as leases for the placement of telecommunications equipment (i.e: cell-phone towers) and facility rentals for events andactivities not currently in use.

Athletic fields and recreation facilities. Naming rights for athletic fields or recreationalfacilities can generate revenue needed to build and/or maintain the complexes. In


i l di P i V i d G l M h ll id f h i h b



partners, including Pepsi, Verizon, and General Motors, have all paid for the right to bethe “exclusive” provider of their respective products and services to the City.

Huntington Beach, CA. The City realizes $3 million per year in benefits from corporatepartners including Coca-Cola, Chevrolet, Simple Green, and Yamaha. Programs haveincluded corporate sponsorship of an environmental education summer camp anddesignation of an official City lifeguard vehicle.

Miami, FL. Purina sponsored construction of two “Dog Chow Dog Parks” as part of amarketing campaign in exchange for naming and promotion rights and a waiver of feesfor park events.

Jacksonville, FL. Jacksonville has pursued MBRO arrangements for advertising at itsvarious athletic venues. Additionally, as northeast Florida’s largest city, Jacksonville hasaggressively sought advertising agreements for city buses. Possibilities for advertisinginclude both the interior and exterior of buses, in addition to “fully wrapped bus”advertising. Advertising fees are based on the number and size of the advertisement, thelength of the advertising contract and the graphic production, installation, and removalcosts.

Boston, MA. Boston’s Street Furniture Program yields an annual fixed fee of $750,000and an annual license royalty fee (10 percent of annual revenues, generating $314,780 inFY2003), from advertising on automatic public toilets, bus shelters, city informationpanels, newsstands, and telephone pillars.

Most comparable cities have used corporate sponsorships as means of financial support for Cityevents and special programs. Examples include Kansas City’s Summer Youth EmploymentProgram, Louisville’s Forest Fest, Minneapolis’ National Night Out, and Baltimore’s PortsAmerican New Year’s Eve Spectacular.


N M ti d B fit F t t f it i l th i b fit t



Non-Monetized Benefits. For street furniture programs in general, there is a benefit tohaving benches, bus shelters, kiosks, and newspaper corrals that are clean, wellmaintained, and aesthetically pleasing. For corporate partnerships, a city can benefit

from a positive association with a prominent company and/or product. A public/privatepartnership can enhance a city’s stature and image.

Administrative Burden Reduction. Vendors typically administer market-based revenueinitiative programs. While contracts are managed by City staff, the “hands free” natureof the programs keeps oversight responsibilities (and commensurate costs) to a minimum.Additionally, because vendors are familiar with administering such programs, the steeplearning curve typically associated with new initiatives can be avoided.

There are a number of issues that should be carefully considered before creating a MBROprogram:

Aesthetics. Companies that develop MBRO are keenly aware of their customers’ desirefor aesthetically pleasing products. While aesthetics must be discussed when fashioninga new program, competent and experienced vendors have dealt with these issueseffectively in numerous situations.

Content. Typically, cities considering MBRO are concerned about affiliating themselveswith companies and/or messages inconsistent with city ethics and civic culture.Companies that develop MBRO are accustomed to dealing with these concerns and willtypically give the client city total control over such matters. A St. Louis MBRO programcould exclude from consideration companies involved with activities incompatible withcommunity standards. Additionally, a preference for partnerships with St. Louis-basedenterprises could be exercised.

Community Nexus. When MBRO such as municipal marketing partnerships are


Th f ll i h ti t f th t b t t d f l t MBRO



The following are rough estimates of revenue that can be extracted from select MBROs.

Advertising frames: Vendors estimate that each advertising frame can generate as much

as $1,920 annually, with a city receiving between 10 to 25 percent of the revenue.

Parking meters: Advertising can be sold for an average of $95 per unit per month, with10 to 20 percent going to the city.

Parking ticket receipts: Approximately 0.5 cents of revenue per ticket can be realized.

Roll-out refuse cart signage: Revenues tend to be in the range of $2.00 - $9.00 per cart

per year.

Beverage and snack beverage machines in parks: These typically yield about $1,400per machine per year in well used parks.

City vehicle fleet advertising: This can yield approximately $500 per vehicle per year.

Actual revenue potential cannot be estimated until programmatic parameters are established; in

particular, revenue potential is subject to the City’s tolerance for placements, concepts, andcontent.

Implementation in St. Louis

The City’s current experience with MBROs has been limited to corporate sponsorship for Cityprojects, such as Project Homeless Connect. A formal MBRO program offers an opportunity forthe City to maximize the revenue-generating capacity of City assets. However, careful attention

should be paid to administrative issues associated with setting up and maintaining such aprogram.


sought through the third party vendor and formal agreements negotiated for the advertising and



sought through the third party vendor and formal agreements negotiated for the advertising andmarketing use of City property. Upon beginning a program, it important that an oversight board,official, or office be appointed to oversee and manage the City’s program to ensure it maintains

corporate sponsor accountability and meets its full revenue potential.The following is a more detailed overview of the steps in establishing an MBRO program:

Table 34: MBRO Program Implementation

Phase I Phase II

1) DepartmentalBlue Sky

Session

4) Create aStrategic

MarketingPlan

1) Developmarketing

packages

5) Presentpackages

toprospects

10)Promote

high bids

16)

Implementation

14)Selection

ofPartner

2) Reviewcurrentcontracts,policies,procedures

5) Prioritizecategories

2) DevelopcustomRFP ifneeded

6)Educatekeyprospects

11)Evaluateoffers

17) DevelopCommunicationStructure

15) FinalContracts

3) Site

visitations/auditassets

6) Define

Policy andProcedure

3) Developsales and

collateralmaterials

7)Conduct

site tourswith keyprospects

12)

Negotiationmeetings

18) Develop

ReviewProcess

7) DevelopSponsorTarget Listfor topcategories

4) FinalCategoryApproval

8)ManageRFP/Bidprocess

13) AdviseStaffOfficials

19) OngoingPartnershipManagement

Source: Don Schulte. “Raising Revenues without Raising Taxes.” Active Network. March 10, 2008.

MBRO programs are typically implemented using a “phased” approach. The following figureshows a three year example timeline to execute the priority categories. Inaugural programs are





Fees, Fines &

User Charges

Fees, Fines & User Charges

St Louis like most local governments assesses user charges and fees to individuals and



St. Louis, like most local governments, assesses user charges and fees to individuals andbusinesses for services it provides. User fees, fines, and charges are an important source of non-tax revenue. In St. Louis, increases to fees, fines, and user charges are restricted by the Hancock

Amendment.

While not a the major source of City revenue, these revenues can provide significant funds tooffset the costs associated with providing services to citizens as well as private and publicentities throughout the City.

The following provides a breakdown of FY2008 actual revenues, including those associated withuser fees, permits, and fines and forfeits:

Figure 18: FY2008 Actual Revenues


fines and user charges Fee amounts can be found in the City Revised Code in City ordinances



fines, and user charges. Fee amounts can be found in the City Revised Code, in City ordinances,and on various department websites. To better integrate this information, maintaining aconsolidated list of fees would facilitate identifying and updating fees.

While some departments regularly reevaluate their fee levels, many City fees and charges havenot been reassessed in over a decade. This is not considered a best practice and means otherGeneral Fund revenues must be used to supplement these services.

To assess the adequacy of current City charges for services and to identify possible areas forrevision, five fee-related tasks were performed:

Development of a master fee schedule Completion of a cost of service analysis Completion of a comparable fee analysis Suggestion of new fees and user charges Best practice recommendations related to fees, fines, and user charges

Through a user fee study, PFM completed an in-depth analysis of 17 fees. These fees arecharged by three departments: public safety, health and hospitals, and streets. In addition to the

original list of fees, PFM completed a comparable survey for fees related to: constructionpermits, electrical permits, and park facility rentals.

Master Inventory

The foundation of this analysis was an inventory of the City’s current fees, fines, and usercharges. The goal was to collect a comprehensive listing of all fees, fines, and user charges aswell as a few other important fee elements. The master fee schedule also includes, where

provided by the departments:


Selected List for Further Analysis



Selected List for Further Analysis

Based on the list of fees, fines, and user charges submitted by departments, a select group of fees

were chosen for further analysis. This group was chosen by considering many factors, includingtotal fee revenue generated, the number of fees issued, and recommendations from departmentdirectors. This list was also submitted to City department staff for discussion andrecommendations.

After taking into account the above-mentioned factors, a subset of the fee inventory was chosenfor an in-depth analysis:

Table 35A: Fees of Interest

PFMID Fee Title

CurrentFee Detail

Streets Department313 Bike Rack Rental $5.00 per rack + $1 deposit per rack316 Blocking Streets - Block Parties $20.00 per day per street314 Blocking Streets (Non-Residential) $20.00 per day315 Blocking Streets (Residential) $10.00 per week

323 Excavation $65.00 per permit, cover dig-rite feesDepartment of Public Safety

371 Certificate of Inspection $70.00$110 if occupied prior to inspection, $25 foreach additional unit inspected in same building

831 Electricity Reconnection $25.00residential and commercial electricity re-hookup inspection

Department of Health and Hospitals

128Food Establishment Permit Renewal(g.r. $0-$0.1 M)

$35.00minimum, up to $100,000 in gross sales duringthe prior year

748 Food Establishment Permit Renewal(g.r. $0.1-$0.5 M) $100.00 prior year gross receipts between $100,000 and$500,000

749Food Establishment Permit Renewal

$150 00 prior year gross receipts $500 000 +


division in the department of public safety and a select number of facility rentals in the



division in the department of public safety and a select number of facility rentals in thedepartment of parks, recreation & forestry:

Table 35B: Fees Selected for Condensed Analysis

PFMID Fee Title

CurrentFee Detail

Department of Public Safety

421 Electrical Permit: Carnivals $50.00per location, inspection of wiring and electricalequipment

368 Electrical Permit: Electrical Outlets $40.00for first unit, plus $1 for each additional unitinspected - Commercial/Industrial

418 Electrical Permit: PanelBoards/Switchboard $40.00 for the first unit, plus $10 for each additionalsection422 Electrical Permit: Reinspection $25.00 for the first reinspection

423Electrical Permit: Reinspection forCertification

$100.00 for the first reinspection

427Electrical Permit: Residential - NewConstruction (including rehab)

$80.00 for the first unit, plus $60 for each additional unit

424Electrical Permit: Residential -Repair/Modify


425Electrical Permit: Residential -Repair/Modify with Service $50.00 for the first unit, plus $40 for each additional unit

426Electrical Permit: Residential -Service Only


419 Electrical Permit: Transformers $40.00 for the first unit, plus $10 for each additional unit420 Electrical Permit: X-Rays $40.00 for the first unit, plus $10 for each additional unitDepartment of Parks Recreation & Forestry71 Athletic Field Rental - Lighted Field $15.00 flat hourly rate, all other city parks (not Forest)72 Athletic Field Rental - Unlighted Field $8.00 flat hourly rate, all other city parks (not Forest)

73Picnics - Picnic Pavilion ElectricWeekdays $45.00 weekday rate, all other city parks (not Forest)

74Picnics - Picnic Pavilion ElectricW k d

$65.00 weekend rate, all other city parks (not Forest)


Table 36: Departmental Fee Adjustments



Table 36: Departmental Fee Adjustments

DepartmentDate Fees Last

UpdatedRegular Fee

Adjustment Base

Department of Healthand Hospitals

30+ Years Ago None

Department of Parks,Recreation & Forestry

2006 Inflation, not annually

Public Safety - BuildingDivision

Major fees reviewedduring budget

None

Streets DepartmentCurrently under

reviewNone

When the date the fee was last changed was provided, this date was used to adjust the charge forinflation. In many cases, this information was not available. In these instances, the departmentswere asked to include as much of the date as possible. If only the year was provided, the firstday of the fiscal year in which the fee was last updated was used.

Normally, PFM suggests using the Bureau of Labor Statistics (BLS) Chained Consumer PriceIndex for All Urban Customers (C-CPI-U) to inflate fees. This index takes into consideration the

substitution effect; if the cost of beef suddenly increases, many consumers will instead choose acheaper alternative such as pork. A significant drawback is the fact that C-CPI-U has only beencalculated from 1999 forward. As many of the fees have not been updated in the past decade,this analysis uses the not-seasonally-adjusted Consumer Price Index for all Urban Consumers(CPI-U), produced by the BLS on a monthly basis.

The results of this analysis are detailed in Table 41: Final Fee Recommendation. Where the datelast changed is unknown, the fees were not adjusted for inflation. When looking at the inflated

values of fees, it is important to note that during the past 12 months there have been 5 months of negative CPI-U growth. This is an atypical growth pattern. According to the second quarterreport by the Federal Reserve Bank of Philadelphia the projected average annual growth in core


Table 37: Comparable Jurisdictions



p

Comparable JurisdictionsBaltimore, Maryland

Indianapolis, IndianaKansas City, Missouri

Minneapolis, Minnesota

St. Louis County, Missouri

The comparables were selected based on three considerations: proximity to the City of St. Louis,best practice jurisdiction for user fees, and similar structure and responsibilities of the localgovernment. Each jurisdiction was selected based on one or more of these considerations.119

A comparable analysis was completed for the fees related to the department of public safety’selectrical permits and the department of recreation, parks & forestry’s facility rentals. However,these fees were not analyzed for cost of service. These fees were excluded from the final list of comparables, as parks and recreation fees are traditionally highly subsidized by localgovernments and there was a lack of information available for electrical permits. The City’scurrent data system has limited reporting capabilities and was not structured to store detailed feeinformation. This made retrieval of detailed information regarding fees largely impossible.

Cost of Service Analysis

The final method of evaluation is a cost of service analysis. This analysis calculates the directand indirect costs associated with providing a service. This type of analysis is important as mostgovernments are legally limited by the requirement that fees cannot be in excess of the cost of service.

Salary costs are the main indicator of the total cost of providing services; to determine this, PFMestimated the average time spent on fee-related tasks. PFM worked with division leaders and


Table 38A: Percent of Employee Time



p yDepartment of Health and Hospitals*

FeeClerk Typist II (2)

Clerk Typist II (2

) -

New Renewal

Structure

Food Establishm

ent

Inspector (11)

Environmental

Health Supervis

or

Accountant II

Salaries Units $56,732 $56,732 $421,278 $47,086 $41,730

Food Establishment Permit Renewal(g.r. $0-$0.1 M)

34 0.69% 0.00% 0.35% 0.31% 0.16%

Food Establishment Permit Renewal(g.r. $0.1-$0.5 M)

9 0.18% 0.00% 0.19% 0.08% 0.04%

Food Establishment Permit Renewal(g.r. $0.5+ M)

2159 44.02% 0.00% 67.15% 19.99% 9.99%

Low Risk Food Permit 233 0.00% 4.75% 2.70% 2.16% 1.08%

Moderate risk Food Permit 343 0.00% 6.99% 7.96% 3.18% 1.59%

High Risk Food Permit 1626 0.00% 33.12% 56.61% 15.06% 7.53%

New Food Establishment Permit 344 14.03% 0.00% 3.97% 3.19% 1.59%

Food Establishment Plan Review 90 0.00% 0.00% 0.45% 0.83% 0.42%Grocery Store Food Permit 166 3.38% 0.00% 3.83% 1.54% 0.00%

Temporary Food Establishment Permit 877 17.88% 0.00% 0.00% 8.12% 4.06%

*Note: Allocated time for new and old arrangements of the food establishment renewal permits is shown in the table.

Table 38B: Percent of Employee TimeDepartment of Streets

kers &

n (27)

Utility

r (3)

oner of

ts

Clerk II

man II

Traffic

or (8)

pist (2)

Traffic

up II


Table 38C: Percent of Employee Time



p yDepartment of Public Safety

Fee

Electrical

Inspector (6)

Clerk Typist

II (2)

Accounting

Clerk (3)

Clerical

Typist II (2

)

Building

Inspectors (68)

Building

Inspector

Supervisor I (12)

Salaries Units $324,200 $56,004 $96,746 $54,600 $2,931,266 $637,909Certificate ofInspection

17376 0.00% 0.00% 21.45% 65.64% 37.50% 40.00%

ElectricityReconnection

2872 11.09% 6.65% 0.00% 0.00% 0.00% 0.00%

In addition to salary costs, overhead rates were created based on the expenditures for thatdepartment. These four rates were created based on the City budget, the City’s A-87 CostAllocation Plan, as well as the line item actual expenditures from 2008. Each of the cost factorsaddresses additional costs to the City which are a direct result of offering these services. Thereare four basic cost factors: fringe benefits (i.e. cost for employee benefits), other costs (e.g.computers, paper, etc.), internal indirect (e.g. administrative staff time), and external indirect (i.e.

central department service charges), as shown in the following table:

Table 39: Four Basic Cost Factors

Department FringeInternal

AdministrationCentral

ServicesOther

Department of Streets -Streets Division

(1)

28.19% 8.14% 21.77% 33.12%

Department of Streets -

Director of Streets25.19% 8.14% 31.36% 4.97%

Department of Health andHospitals

25.81% 35.07% 47.87% 3.84%


Internal External Fully



Fee TitleSalaryCosts

FringeCosts

OtherCosts

InternalIndirectCosts

ExternalIndirectCosts

FullyLoaded

Cost

Excavation $177,803 $49,560 $53,610 $14,473 $40,506 $335,952

Certificate of Inspection $1,410,983 $370,383 $100,603 $216,727 $264,983 $2,363,679Electricity Reconnection $39,677 $10,415 $2,829 $6,094 $7,451 $66,467

Food Establishment PermitRenewal (g.r. $0-$0.1 M)

$2,092 $540 $80 $483 $1,002 $4,197

Food Establishment PermitRenewal (g.r. $0.1-$0.5 M)

$947 $244 $36 $218 $453 $1,899

Food Establishment PermitRenewal (g.r. $0.5+ M)

$321,450 $82,966 $12,344 $74,159 $153,878 $644,797

Low Risk Food Permit $15,551 $4,014 $597 $3,588 $7,444 $31,193

Moderate risk Food Permit $39,663 $10,237 $1,523 $9,150 $18,987 $79,560

High Risk Food Permit $267,523 $69,048 $10,273 $61,718 $128,063 $536,624

New Food Establishment Permit $26,838 $6,927 $1,031 $6,192 $12,847 $53,835

Food Establishment Plan Review $2,481 $640 $95 $572 $1,188 $4,977

Grocery Store Food Permit $18,777 $4,846 $721 $4,332 $8,989 $37,665

Temporary Food EstablishmentPermit

$15,661 $4,042 $601 $3,613 $7,497 $31,415

*Recommendations were made for the cost of service of both the new and the old fee structures for the Food EstablishmentRenewal Permits in the department of health and hospitals.

After calculating the total cost associated with a particular fee in a year, an average cost isdetermined. The average cost is determined by dividing the fully loaded cost by the number of fees issued in FY2008, (as provided by the departments):

Table 40B: Difference between Cost and Current Charge

Fee TitleFully

LoadedC t

Units inFY08

Cost PerUnit

CurrentFee

CostDifference

% overOld Fee


Fully Units in Cost Per Current Cost % over



Fee TitleFully

LoadedCost

Units inFY08

Cost PerUnit

CurrentFee

CostDifference

% overOld Fee

Temporary Food Establishment

Permit$31,415 877 $35.82 $35.00 $0.82 2%


1. Increase User Fees to Recover More of the Cost of Service

Currently, most City fees subject to analysis are recovering less than 50 percent of the cost of

service and are significantly underpriced. In general, PFM recommends increasing fees and usercharges with a largely private benefit to the cost of service. Although increasing fees to the costof service is considered a best practice, raising fees beyond 25 percent in a single year may causeeconomic strain and backlash from the community. The City should incrementally increase itsfees to reach the cost of service.

Full cost recovery should be the goal for all fees where the City’s cost of service recovery levelhas been set at 100 percent. Cost recovery levels are generally set through a user fee policy,based on several factors, which will be discussed later in the chapter.

Based on the cost of service, PFM recommends the following increases in fee levels, which arefound in Table 41. Additional metrics have been provided in the following table alongside theprior and recommended fee levels. Each fee has been rounded up. If under $50, the fee wasrounded up to the next $5 increment, if between $50 and $100, it was rounded up to the $10increment, and if above $100, it was rounded up to the next $15 increment.

Based on this rounding method, only two fees remain unchanged, with all other fees increased.In the first columns information is repeated from the previous table Fees are also shown with a


Table 41: Final Fee Recommendations*



PFMID

Fee TitleCurrent

FeeCost per

Unit25%

InflationCPI-U Adj

FeeNewFee

Change

313 Bike Rack Rental $5.00 $9.46 $6.25 $4.89 $10.00 $5.00316 Blocking Streets - Block Parties $20.00 $15.40 $25.00 $19.55 $20.00 $0.00

314 Blocking Streets (Non-Residential) $20.00 $34.83 $25.00 $19.55 $35.00 $15.00

315 Blocking Streets (Residential) $10.00 $34.84 $12.50 $9.77 $35.00 $25.00

323 Excavation $65.00 $118.29 $81.25 $81.20 $130.00 $65.00

371 Certificate of Inspection $70.00 $136.03 $87.50 $89.80 $145.00 $75.00

831 Electricity Reconnection $25.00 $23.14 $31.25 $32.07 $25.00 $0.00

128Food Establishment PermitRenewal (g.r. $0-$0.1 M)

$35.00 $123.43 $43.75 $48.07 $130.00 $95.00

748Food Establishment PermitRenewal (g.r. $0.1-$0.5 M)

$100.00 $211.04 $125.00 $137.35 $220.00 $120.00

749Food Establishment PermitRenewal (g.r. $0.5+ M)

$150.00 $298.66 $187.50 $206.03 $310.00 $160.00

823 Low Risk Food Permit $75.00 $133.88 $93.75 $75.00 $145.00 $70.00

824 Moderate risk Food Permit $150.00 $231.95 $187.50 $150.00 $235.00 $85.00

825 High Risk Food Permit $225.00 $330.03 $281.25 $225.00 $340.00 $115.00

127 New Food Establishment Permit $35.00 $156.50 $43.75 $48.07 $160.00 $125.00

129 Food Establishment Plan Review $0.00 $55.30 $0.00 $0.00 $60.00 $60.00830 Grocery Store Food Permit $0.00 $226.90 $0.00 $0.00 $235.00 $235.00

131Temporary Food EstablishmentPermit

$35.00 $35.82 $43.75 $35.00 $40.00 $5.00

*Recommendations were made for the cost of service of both the new and the old fee structures for the Food EstablishmentRenewal Permits in the department of health and hospitals. Currently, the department has submitted an ordinance to the Board ofAldermen requesting that the structure. Currently, the structure is based on gross receipts, and the change will make it based on therisk associated with the establishment.

Results from the Analysis

The fees analyzed in this report have been subjected to multiple types of analysis These three


Table 42: Anticipated New Revenues*



PFMID

Fee Title Units CurrentFee

RevenuesBefore

100% CostRecovery

ProjectedRevenues

25%Increase

ProjectedRevenues

313 Bike Rack Rental 6,131 $5.00 $30,655 $10.00 $61,310 $6.25 $38,319316 Block Parties 100 $20.00 $2,000 $20.00 $2,000 $20.00 $2,000

314Blocking Streets (Non-Residential)

876 $20.00 $17,520 $35.00 $30,660 $25.00 $21,900

315 Blocking Streets (Residential) 3,503 $10.00 $35,030 $35.00 $122,605 $12.50 $43,788

323 Excavation 2,840 $65.00 $184,600 $130.00 $369,200 $81.25 $230,750

371 Certificate of Inspection 17,376 $70.00 $1,216,320 $145.00 $2,519,520 $87.50 $1,520,400

831 Electricity Reconnection 2,872 $25.00 $71,800 $25.00 $71,800 $25.00 $71,800

823 Low Risk Food Permit 233 $75.00 $17,475 $145.00 $33,785 $93.75 $21,844

824 Moderate risk Food Permit 343 $150.00 $51,450 $235.00 $80,605 $187.50 $64,313825 High Risk Food Permit 1,626 $225.00 $365,850 $340.00 $552,840 $281.25 $457,313

127New Food EstablishmentPermit

344 $35.00 $12,040 $160.00 $55,040 $43.75 $15,050

129Food Establishment PlanReview

90 $0.00 $0 $60.00 $5,400 $0.00 $0.00

830 Grocery Store Food Permit 166 $0.00 $0 $235.00 $39,010 $0.00 $0.00

131Temporary FoodEstablishment Permit

877 $35.00 $30,695 $40.00 $35,080 $40.00 $35,080

Total $2,035,435 $3,978,855 $2,525,844

*In the table above the old structure of Food Establishment Renewal Permits has been removed to prevent double counting ofpotential revenues.

If the number of units per fee remains constant, the City could collect an additional $1.9 millionin revenues if it increased fees immediately to fully cover costs. Taking into account thesignificant increase in fees required to reach the cost of service, it is probably more realistic tophase in fee increases over time. The projected revenues from increasing all fees that are

currently below the cost of service by 25 percent would provide the City with approximately$490,000 in new revenues.




2. Increase Fees for Construction Permits

In addition to the various permits and fees discussed in this chapter, construction permits areconsidered a major revenue generator. An in-depth cost of service analysis was not conductedfor construction permits; instead, a comparable analysis was conducted to determine how otherjurisdictions priced these fees. The structure of the current City of St. Louis construction fee isshown as follows:

Table 43: City of St. Louis Construction Permit Fees

EstimatedConstructionCost

ApplicationFee

PermitFee

TotalFee

Notes

$0 - $1,000 $25.00 $19.00 $44.00

$1,001- $2,000 $25.00 $23.00 $48.00

$2,001 - $3,000 $25.00 $27.00 $52.00

Over $3,000 $25.00 $9.00Permit fee per thousandestimated constructioncost, or fraction thereof.

PFM conducted a short analysis on the fee structures or construction permits from thecomparable group. The next table illustrates that the City of St. Louis is charging less for aconstruction permit than other regional and national cities. Although reduced permitting costsare offered as an incentive for new construction, more competitive rates could be considered.

A full listing of the construction fees structures may be found in Appendix D.

Fees,

Table 44A: Comparable Minimum and Maximum Construction Fees



Residential Commercial

Fee Determined By Classification Breakdown

Fee

RangeMin.

Fee

RangeMax.

Fee

RangeMin.

Fee RangeMax.

St. Louis Project Valuation None $15.00 None $15.00 None

Kansas City Project Valuation 1 And 2 Family Residential; All other $48.00 $448.00 $48.00 $9,201.00

St. LouisCounty

Project CostCommercial, Industrial, Multiple-Family and Residential

$73.00 $2,330.00 $73.00 $170,145.00

BaltimoreCubic Feet of GrossVolume

1 And 2 Family Residential; All other $100.00 None $200.00 None

Indianapolis Square Feet ofGross Area

1 And 2 Family Residential; All other $135.00 None $215.00 None

Minneapolis Project Valuation None $69.75 $6,853.40 $69.75 $6,853.40

Table 44B: Comparable Additional Construction Fees

Residential Commercial

Fee Determined By Classification Breakdown Additional Fee AdditionalFee

AdditionalFee

ApplF

St. Louis Project Valuation NoneYes, per $1,000

value$5.00 $5.00 Yes

Kansas City Project Valuation1 And 2 Family Residential; Allother

Yes, per $1,000value

$1.30-$4.00$3.60-$12.50

N

St. LouisCounty

Project CostCommercial, Industrial, Multiple-Family and Residential

No No No N

BaltimoreCubic Feet of GrossVolume

1 And 2 Family Residential; Allother

Yes, per 1,000cubic feet

$10.00 $20.00 N

IndianapolisSquare Feet ofGross Area

1 And 2 Family Residential; Allother

Yes, per squarefoot

$0.05 $0.10 N

Y $1 000 $3 80 $3 80


3. Develop and Implement a User Fee Policy



A formal fee policy is a statement providing guidelines for setting fees and charges for services.A fee policy also identifies factors that the jurisdiction needs to consider when setting the priceof goods and services, as well as the degree to which the cost of service is covered by the feesand charges. In addition, the fee policy provides a well-articulated rationale for adopting a costrecovery level of below 100 percent.

Many jurisdictions infrequently update fees and user charges, allowing long periods of time toelapse between adjusting fees. This can heighten financial problems, as the cost of providingservices increases while the revenue received for those services remains stagnant. In order to

rectify this problem, the GFOA has suggested that “A formal policy regarding charges and feesshould be adopted. The policy should identify what factors are to be taken into account whenpricing goods and services…”120 These formal policies are called user fee policies. Creation of auser fee policy is considered a best practice for public budgeting according to the GFOA.

Over the past decade, many cities and counties have began to adopt user fee policies to keep feescompetitive and assure that fees are set in accordance with the policy objectives of thejurisdiction. Jurisdictions with user fee policies include San Luis Obispo, CA, Henderson, NV,

Martin County, FL, Dallas, TX, and Boulder, CO. St. Louis has no formal policy on how andwhen to adjust user fees and charges. Lacking a City-wide policy, individual departments arecharged with maintaining their own fee schedule. This has led to the current situation; some feeshave been updated in the past few months, while others have not been changed in nearly 50years.

Maintaining up-to-date and competitive fees will help the City maintain a sustainable revenuestream to cover the costs associated with providing services. An individual user fee policy

should be created for the City of St. Louis. A user fee policy will require decisions in five areas:


The feasibility of determining an appropriate charge.



Depending on the policy goals, San Luis Obispo determines if the fee should fall into the low,medium, or high level for cost recovery. San Luis Obispo plans to recoup 67-80 percent, 30-50percent, and 0-25 percent, respectively, of the cost of providing the service.

Level of Detail

There are many different user fee policies; each one is specialized for the jurisdiction. The firstquestion one asks is whether the scope of the policy should be broad or detailed. The Cityshould consider if it would like to list cost recovery goals for specific departments or types of

fees in the policy. Many jurisdictions have chosen a broad user fee policy. These includeHenderson, NV, Martin County, FL, and Dallas, TX. St. Louis should also decide if the user feepolicy is to cover all departments or allow individual departments to craft their own user fee andcharges policies. Although department specific policies are sometimes used, a city-wide policyis generally recommended.

Approval Body

The City will also need approval of the user fee policy by the Board of Aldermen and/or theBoard of Estimate and Apportionment. There are reasons to favor an administratively approvedpolicy (i.e. efficiency) or a legislatively approved policy (i.e. increased legitimacy). If the policyis department-specific or City-wide, the method of approval could change.

Time Period of Adjustment

A jurisdiction must determine a regular time interval for fee adjustments. Many jurisdictions

pick either one or two years between regular, cursory adjustments; adjustments are normallybased on an inflator. Possible fee inflators to use are the Consumer Price Index, or the CPI for a


Comparability



In addition to regular fee adjustments and cost of service analyses, the fees charged by regionaland other similar jurisdictions should be considered. Cities generally must ascertain whethertheir fees are competitive. Some jurisdictions partially subsidize building permits in order toencourage business and residential development.

Conclusion

San Luis Obispo, California has adopted a city policy that clearly explains the user fee policyprocess and implements the guidelines of both the GFOA and the National Advisory Council on

State and Local Budgeting Practice (NACSLB). Their city policy is a good example of the levelof detail that a user fee policy may contain. This policy has been used as a foundation by manyjurisdictions for the development of their own policy. St. Louis should strongly consider thecreation and implementation of a user fee policy using San Luis Obispo’s current policy as aguide.

122

4. Examine Options to Update or Modernize IT Systems Related to User Fees

Like many cities, the technological capabilities of many departments in the City of St. Louis arebehind what is needed in order for the city to conduct its business efficiently. Many of thedepartments are greatly in need technological updates. The City’s Information Technologysystems create several challenges for collecting, administering, and reporting fees and charges.

The information technology systems within the departments lack capability for monitoring,storage, or easy of retrieval of information related to fees and charges paid and revenues. Someof these systems have never been modernized. In the past, the City has had platforms built

specifically for individual departments instead of using an easy to update “off the shelf” typeprogram. Department-specific systems cannot be easily updated with new developments in


implementation of a citywide program to create a centralized platform where all information mayb l d d d i d ll h i i l l h h b f f



be placed, stored, and retrieved as well as other statistical elements, such as the number of feesissued and paid. While a new technology or even a new financial system could address all of these issues, the City should examine cost and time efficient options in the current system. Suchoptions could include utilizing inactive data fields to track more fee specific information ordeveloping reports specifically around fee collections.

5. Consider Generating Additional Revenue from New User Based Charges

As noted in earlier chapters, user fees are emerging as the fastest growing source of manymunicipalities’ revenue portfolios. St. Louis has not relied on user fees to the extent of many

other cities. Given the need to generate additional revenue to fulfill service demands and enablea more competitive tax environment, the City should consider additional user fees.

Solid Waste Fees

Currently, St. Louis does not charge a fee for trash collection services provided to its residentialusers. In addition, St. Louis also provides residential customers with yard waste pick up, bulkyitem pickup, and recycling services. While these are valuable services for St. Louis residents,

they impose a significant cost on the City. Trash collection requires personnel, equipment,transportation, and landfill space. Unlike many other jurisdictions nationally or in themetropolitan area, St. Louis does not impose a user fee for these services, and trash collection issupported by general City revenues.

Many jurisdictions utilize different types of trash fees to cover the cost of collecting refuse, aswell as to cover the cost of additional services such as bulky item pickup. These trash fees areoften paid once a month by residents, and could be added to other City bills (such as water bills).

Another approach, Pay-As-You-Throw (PAYT), charges residents per bag of trash disposed, andgenerally provides recycling services for free. Currently, the State of Missouri has 36 PAYT


the City considers long-term solutions to solid waste disposal costs and lowering landfill usage,PAYT ld b i bl ti



PAYT could become a viable option.

More immediately, the City could introduce a mandatory monthly or annual fee for residents,charging a flat amount per person or per residence, regardless of the amount of waste generated.The following are select examples of cities that charge for solid waste services:

Minneapolis charges each housing unit a $24 monthly base fee and a monthly disposalfee of $2-$4 for solid waste collection. The city also provides a $7 monthly credit tousers who recycle.125

St. Charles residents pay $14.48 per month for residential solid waste disposal and

curbside recycling services.

126

Norfolk charges a typical single family dwelling unit $202.97 annually for residential

collection services.127 Omaha residents pay $48.74 per month for residential garbage, recycling, and yard waste

collection. Memphis charges households $20.55 per month for residential garbage, recycling, and

bulky item collection. Jacksonville, FL residents pay $51 as an annual fee for collection of yard waste,

household garbage, and recycling.128

According to the most recent American Community Survey, there are 141,559 occupied housingunits within the City.129 Distributing the total cost of solid waste services over the housing unitsprovides an estimated annual cost of providing the service per housing unit. The FY2010 budgetfor the Refuse Division was approximately $13.6 million. These costs include: personalservices, materials and supplies, as well as contractual and other services. This would indicatethat an annual fee of approximately $95.93, or a monthly fee of $7.99, would cover the City’s

direct costs associated with solid waste services. While policy makers may ultimately decidedue to constituent feedback and other reasons that a trash fee is not viable at this time, the City


Th Cit f St L i h ld id ti t hi ith th Mi i i i liti



The City of St. Louis should consider creating partnerships with other Missouri municipalities orworking with the Missouri Municipal League to lobby the state legislature to increase such fees,or provide localities with the option to raise fees to a certain limit. Given the budgetary climate,the City would likely find many willing partners in such an effort and could form a strongcoalition to lobby on its behalf.



Tax Collection

Regardless of the specific sources that comprise its revenue structure, every city benefits fromhaving effective procedures processes and systems in place to collect its revenue This serves



having effective procedures, processes, and systems in place to collect its revenue. This servesdual purposes: it provides the revenue necessary to provide essential services and does so in acost-effective, efficient manner. Given the state of the current economy and city budgets acrossthe country, it is not surprising that many cities are rethinking their tax collection andenforcement policies to help address existing and future budget gaps.

Due to its status as an independent city, St. Louis has a unique tax collection structure. Whenexamining tax collection practices and policies in St. Louis, it is necessary to analyze taxcollection within that framework. This would include:

Describing the current roles and responsibilities of the City offices that are responsiblefor tax and revenue collection Detailing best practices in tax and revenue collection from municipalities nationwide Evaluating the City’s current operations compared to best practices and providing

recommendations

While staffing and organization can be important aspects of revenue collection procedures andpractices, it is not within the scope of this study. While eliminating or consolidating existing

offices and changes to the City’s charter may provide opportunities for efficiencies and/orsavings, they are not considered here. The overall goal is to present recommendations tostrengthen the City’s existing tax and revenue collection structure in line with best practices tocraft a more efficient and effective tax and revenue collection operation.

Tax Collection Structure

The responsibility for tax collection in St. Louis is highly decentralized amongst several city

departments. Business and other license fee collection is the responsibility and resides within theoffice of the License Collector. The Collector of Revenue is responsible for collecting other

Tax Collection

• The Internal Audit Section performs reviews cash counts in the Treasurer’s Office and



• The Internal Audit Section performs reviews cash counts in the Treasurer s Office andfinancial process reviews of City departments to ensure sufficient control over financialinformation and assets.

• The Accounting Services Section maintains a central index of businesses subject to Citylicense fees and taxes.

• The Finance and Development Section is responsible for the efficient management of theCity's financings.

The Comptroller’s revenue collection responsibilities include being the recipient of City sales taxrevenue remitted by the state; collecting rents on city-owned property; collecting franchise taxes,

wharf, and harbor licensing fees, and other incidental revenue not explicitly provided for by theCity Code.

Collector of Revenue

The chief tax collection official in the City, the Collector of Revenue (Collector) collects theearnings tax, payroll expense tax, real and personal property taxes, special tax bills, and all othermajor city taxes and fees. The Collector also handles water bill payments for the water division

and supervises an office of the Missouri Department of Revenue operating in City Hall.

The office is funded by commissions based on a portion of the revenue it collects for the City.At the close of the fiscal year, the Collector remits remaining commission funds back to Citydepartments in proportion to their General Fund appropriation. At times this amount has beensignificant—in FY2008 it was $9.7 million.

The Collector is required by City ordinance to keep a daily record of tax receipts, delinquent and

forfeited taxes. The Collector is also required to file monthly budget reports for water billcollections.

Tax Collection

License Collector



License Collector

The License Collector is responsible for collecting all business and occupational licenses feesand taxes. The City’s major business taxes are tied to occupational licensing, which is under thejurisdiction of the License Collector. These taxes include the hotel/motel, parking, amusement,and restaurant taxes.

The most significant revenue source collected by the office is business license fees, whichaccount for 25.1 percent of all revenue collected by the License Collector. Licenses are onlyissued after receipt of a statement of clearance from property or earnings taxes from the

Collector of Revenue. The License Collector also has the power to revoke and withhold licensesfrom businesses that have unsatisfied final judgments. The office is funded by a four percentcommission on licenses, which produces $2.5 to $3.0 million per year. The License Collector’sbudget is, on average, about $2.1 million per year, and the office has the ability to reserve up totwo times its annual expenditures.

Recorder of Deeds

The Recorder of Deeds is responsible for management and upkeep of all birth, death, marriage,and land records in the City. Revenue collecting responsibility is limited to receiving fees for therecording and release of these records, as well as for state and federal tax lien records.

Treasurer

In addition to being responsible for the City’s banking systems, the Treasurer also manages theparking services operation. This includes collection of revenue from parking meters and City

owned-parking garages and lots. Many of these revenue collection functions have recently beenoutsourced to a private collector which also performs maintenance and upkeep on city parking

Tax Collection

compliance.130 The greater the percentage of voluntary compliance, the greater the resourcesthat government can spend on providing key services and the less it has to spend on



that government can spend on providing key services and the less it has to spend onadministrative functions.

The following are commonly accepted practices geared at maximizing voluntary compliance toenhance the efficiency of tax administration, reporting, and enforcement.

Tax Payment

Online Payment Options

One of the better ways to increase taxpayer compliance is by enhancing ease of payment.Offering a variety of means of payment – mail, check, credit card, cash, online, direct debit, andmoney order – improves taxpayer convenience and makes compliance easier. Online paymentsystems provide a particularly easy way to pay taxes, as they are accessible to anyone withInternet access and a debit or credit card, or checking account. In addition, online systems allowfor a taxpayer ID system where a taxpayer can pay a variety of taxes under a single tax accounttied to an identification number. This makes it easier to track the full range of city taxes and feespaid by single individuals or entities. Several cities have developed effective means to ease

payment of taxes for citizens:

Arlington, VA maintains a single tax and fee payment site on the city website thatenables users to sign up for a single online account to register vehicles, obtain right of way permits, pay business and property taxes, pay utility bills, and pay other commontaxes and fees. The site uses a single user friendly interface for all taxes and fees whileproviding basic information on payment methods and tax structures.

Birmingham, AL has a single city online tax filing and payment system that enables thepublic to simultaneously file and pay for sales, use, lease, lodging, and employers



Tax Collection

resource planning systems (ERP) that manage administrative functions for departments through asingle electronic interface This platform provides an excellent means of sharing information



single electronic interface. This platform provides an excellent means of sharing informationcritical to identifying individual taxpayers for audits and tracking unpaid tax liabilities andjudgments. Adopting a similar approach for tax collection can solve many of the problems facedby cities with tax collection responsibilities dispersed amongst several departments. Somemunicipalities have already begun to reap the benefits from this approach.

In addition, some governments have acquired data warehousing and management capabilitiesthat have enhanced the ability to track and manage revenue collections. These systems can storehistorical information about debtor addresses, occupation, and financial accounts, enablingeffective tracking and notification of delinquent taxpayers. Automated collections systems allow

for automated case flows, reducing the need for manual processing of cases. Many governmentshave found these systems pay for themselves through increased collections from enhancedcollections management capabilities. Examples of systems include:

St. Louis County’s ERP system, installed in 2008, enables the county to make financialinformation and documents more accessible to county departments. The county’s newcashiering software allows for a centralized tax and fee collection process that creates asingle point of entry for data from many applications. The system allows for real time

tax collection reporting

that has enhanced the county’s ability to monitor critical revenuestreams.132

St. Charles County recently transitioned to an ERP system with a comprehensive arrayof revenue reporting and collection functions. The county currently has sharedapplications for building permits and code enforcement, business licensing, revenuereporting, and accounts receivable.

133

Durham, NC’s new ERP system allows individual department applications to interfaceand streamlines all departments and functions onto a single data management system.

Tax Collection

Delinquent Tax and Fee Collection



Delinquent tax and fee collection is a key function of any city tax collection agency. Enforcingdelinquent accounts sends a strong message to taxpayers who timely file as well as those who donot that delinquent or non-payment of tax liabilities will be met with a decisive city response.Cities across the country have utilized multiple methods to deal with delinquent accounts,including engaging third party collection services, undertaking managed competition processes,creating online delinquent taxpayer lists, and setting up taxpayer assistance programs.

Prioritization of Cases

In recent years, revenue collecting agencies have found it useful to focus on delinquent tax caseswith the greatest likelihood of payment and the greatest potential yield. Developing a scoringsystem, which ranks cases in order of priority, can be a helpful tool to focus collection efforts onthe most promising accounts. A system that excludes cases involving individuals that aredeceased, bankrupt, or in jail can save valuable time and resources from pursuing cases that havelittle chance of recovery. It can be relatively easy to obtain this information using online publicand subscription information services. Although sometimes this can result in the writing off of smaller, low-yield cases, concentration on more promising cases can lead to an increased overall

collection rate.

Voluntary Bank Wage Garnishment

Currently, the City has relationships with local banks that allow for payment of utility bills andfees at local bank branches. These relationships can be used to solicit voluntary bank garnishment of wages. Expanding on existing relationships with local banks can provideopportunities to capture more delinquent taxpayer income. State revenue departments, such as

Maryland’s Comptroller’s Office, have found these arrangements to be quite effective whennegotiated with a group of commonly used local banks. When taxpayers are more cooperative,

Tax Collection

Managed Competition



Some governments have explored managed competition approaches to revenue collection,putting revenue collection functions out to bid among city and private collection agencies.While this practice is relatively new and has not yet emerged as a proven option for cities, it hasthe potential to increase efficiency in collections for existing city revenue collection agencies.

In 1998, San Diego County, CA subjected its accounts receivable management and collectionsfunctions to a managed competition with other county departments and the private sector. TheRFP required the contractor to utilize improved business practices and provide a better return onthe $80 million in new accounts received by the County. The existing county agency was the

ultimate winner of the competition, realizing through cost savings and revenue enhancements anadditional $575,000 annually for the county.136

Online Delinquent Taxpayer Lists

Another approach to collecting on delinquent accounts is the use of online delinquent taxpayerlists. This is commonly used by states to extract payment on large business accounts; it is alsogaining popularity amongst cities as well. Posting the names and amounts owed of delinquent

taxpayers often has the effect of “shaming” the taxpayer into paying a tax liability, whilediscouraging further delinquent or non-payment of taxes. In some cases, the taxpayer is firstalerted that he or she is eligible for publication and given a deadline to make paymentarrangements. These lists are currently in use by the cities of Alexandria, VA, Los Angeles, CA,and Philadelphia, PA. Another strategy is reporting of delinquencies to credit bureaus, whichreduces the amount of available credit to the delinquent taxpayer. This serves as an additionalincentive to pay down remaining tax debt

Offset Programs

Tax Collection

Tax Fraud and Evasion



Many cities have devised ways to encourage reporting of tax fraud and evasion. Chicago, IL andToledo, OH provide confidential online forms for reporting delinquent or non-filing businesses.Philadelphia, PA, New York, NY, and the District of Columbia have hotlines for reporting of taxfraud and evasion. St. Louis also has a fraud hotline, but it only applies to fraud within Citygovernment. As an alternative, some cities have implemented “whistleblower” programs thatreward individuals that provide the city with information on businesses that are not paying taxeswith a portion of the recovered taxes. These programs are currently used by the InternalRevenue Service and the City of Los Angeles, CA.

Taxpayer Assistance Programs

These programs assist individuals that are unable to or have difficulty making tax payments.They are a good strategy to reduce the need for delinquent collections. Among these options aretax deferral programs, which target individuals that have a level of property tax that isdisproportionate to their income. In these programs, property tax payments are deferred to alater date, while the deferred payments serve as an interest-bearing loan to the taxpayer securedby a lien attached to the property. This is designed to mitigate the effects of property tax

increases on lower-income homeowners which ensuring the city receives the full property taxliability on a property. Examples include:

Minneapolis, MN leverages funds from the state as the deferral loan and restricts theinterest rate to no more than 3.5 percent. The program also guarantees that propertyowners will pay no more than three percent of total household income toward propertytaxes each year.

Cook County (Chicago), IL has a tax deferral program for seniors making $50,000 orless. Like Minneapolis, Cook County receives funds from the state as a loan that is

Tax Collection

Delinquent Tax Collection Fees



Delinquent tax collection fees are percentage-based fees attached to long past due tax liabilitiesthat reimburse collecting agencies for the cost of collection. These levies are always in additionto existing penalties, interest, and charges imposed as a result of late payment. Commonly, taxpayers are given adequate notice before the fee is formally applied. Such fees are current in useby the state of Wisconsin, and are also authorized for use by Ohio counties. These fees canprovide a new source of funding for City collecting agencies, while further discouraging latepayment of taxes and fees.

Standardized Accounts Receivable Controls

The Government Finance Officers Association (GFOA) identifies formal controls over accountsreceivables as a best practice. According to the GFOA, there should be allowances for doubtfulaccounts and formal guidelines on efforts to pursue the timely collection of delinquentaccounts.

138Uncollectable accounts should be written off from financial statements.

It is recommended that governments develop formal controls over accounts receivableprocedures and develop formal policy statements on the handling of revenues. For collections,

the GFOA recommends that accounts receivable be recorded in a way that permits an analysis of the aging of the receivables. Standard practices should be developed that regularly senddelinquent notices and establish information criteria for the initial credit application process withthe consumer. Collection agencies should be used to ensure governments receive all thereceivables owed. Several cities have these similar policies in effect. For example:

Murrieta, CA has a delinquency policy that requires foreclosure procedures once acertain level of property tax delinquency is achieved. The City also has fixed standards

and guidelines for negotiating payment plans with delinquent taxpayers and guidelinesfor handling and tracking delinquent accounts.

Tax Collection

Performance Evaluation



Effective performance evaluations are vital to any successful tax collection system. In manycities, this means tracking property tax collection rates and undertaking regular city audits of revenue collection procedures. These provide valuable information to guide tax collection andidentify opportunities for improvement and increased efficiency. However, there are additionaloptions that cities can consider to improve the performance of their tax collection system.

Tax Collection Targets

Tax collection targets can be an effective way to encourage city staff to aggressively pursue

delinquent accounts. In addition, offering financial incentives to individuals that meet or exceedcollection targets can be another way of accomplishing this. Some municipalities havesuccessfully used tax collection targets to enhance collection performance:

Nassau County, NY has used property tax collection targets to guide and motivateefforts to receive delinquent property taxes and liquidate assets acquired through courtjudgments.

Pender County, NC uses a tax collection goal as motivation for its property taxcollection efforts. The County’s CFO recently found that the county will likely meet itsannual property tax collection target by the end of 2009, increasing collections overprevious years.

New Haven, CT has established a citywide tax collection target in response to the city’slow overall tax collection rate from years of relaxed enforcement. Consequently, newways were devised to increase collections. The city now makes extensive use of towing

vehicles of delinquent taxpayers that owe motor vehicle taxes and sells them at auction torecover tax revenue. As a result of this and similar efforts, the city's overall tax

139

Tax Collection

Intergovernmental Cooperation



For tax collection, intergovernmental cooperation can yield substantial benefits. Cooperationwith federal, state, and neighboring local governments can often be helpful in coordinating

enforcement efforts, sharing tax information, and identifying tax delinquents and tax cheats. TheIRS maintains an information sharing program for large cities with local income taxes. The Cityhas used it to identify non-filing taxpayers. There are also other unique intergovernmentalopportunities - including streamlined state and local filing of taxes that eases the cost of taxpayercompliance. For example, the City of Baltimore, MD allows for joint income tax filing with theState of Maryland. Joint filing ensures that city businesses and individuals paying state taxes payapplicable city taxes as well.

In addition, cooperation with other legal governments can help to share information about taxcollection best practices, tax collection IT platforms, and non-filing or delinquent regionaltaxpayers. This information sharing can identify regional patterns of tax fraud and lead toadoption of improved tax collection practices throughout the region. Some municipalities haveused intergovernmental relationships to maximize tax collections. The City of Dayton, OHcontracts with a Cleveland collection agency to match city taxpayer records with IRS taxrecords. This agreement has enabled the city to identify and notify those that have escaped the

city’s local income tax. Cook County, IL allows the County Director of Revenue to enter intotax information sharing agreements with other home rule jurisdiction imposing a local use tax.

Evaluation of St. Louis’ Tax Collection System

As discussed earlier, authority for tax collection in St. Louis is highly fragmented. Primaryrevenue collection responsibilities rest with the Comptroller, Collector of Revenue, and theLicense Collector, with other offices and departments playing additional tax collection roles.

The City needs to centralize tax collection functions, policies, procedures, and methods toachieve higher collection rates and more efficient tax administration. The City’s decentralized

Tax Collection

Restaurant Tax Hotel/Motel Tax



Parking Tax Traffic Camera Violations Municipal Court Costs

Currently, there is no ability to pay multiple taxes and fees using a single online interface, eventhough this is more convenient for taxpayers and less costly to administer than maintainingmultiple payment systems. Moreover, payment of City taxes through officialpayments.com isnot easy or user friendly and requires a user search to find the parts of the site allowing forpayment of St. Louis taxes and fees.

Lack of Single-Site City Payment Centers

The City lacks a central payment center that eases the burden of taxpayer compliance andimproves citizen service. In-person payment of taxes and fees requires going to multiple officesin City Hall that have responsibility for various taxes, fees, and charges. The City has takensome positive steps, such as opening a Missouri Department of Revenue fee office in City Hallto make it easier to make City and State tax and fee payments at a single location. In addition,the City has partnered with six local banks to accept real and personal property tax payments.However, these cooperative efforts have not extended to other City departments.

There is a lack of collaboration on the handling of tax and fee payments among Citydepartments. In addition, there is currently no single physical place to go to learn how to get abusiness license. The business assistance office in the Mayor’s Office assists in navigating thecomplex process that is required to get a license and allows for distribution of business forms,applications, and fee payments by mail. However there is no single service center that handles

all aspects of this process.

L k f C t li d IT Pl tf

Tax Collection

Collection of Past Due Receivables and Taxes



The City’s efforts to collect past due receivables have been inconsistent across departments dueto the City’s fragmented system of tax collection. The Municipal Court, parks, recreation, and

forestry, and fire departments have contracted with a third party collector to collect fees, fines,and taxes that are delinquent, although this has not been a practice widely adopted by other Citydepartments.

The delinquent tax and fee collection problem is particularly acute in the License Collector’sOffice. The field services division is responsible for finding those operating a business without alicense in St. Louis. Currently the division believes there are approximately 2,000 businesses inits files that have had licenses in the past but do not currently have them.

It is likely that a large number of businesses in the City have escaped payment of annual businesslicense fees. Another problem has been identifying home businesses and contractors. TheOffice has made an effort to track these taxpayers through the Collector of Revenue’s earningsand payroll tax records but has only made incremental progress toward reducing the gap. In thearea of permits, ultimate payment of fees has sometimes been influenced by politicalconnections. Several City departments have noted that some groups and constituents have oftenhad various fees and charges waived. In addition, ambiguity over the applicability of City feesand charges to nonprofit organizations has complicated the administration of fee collection.

Currently, the City has relationships with local banks that allow for payment of non-delinquentproperty taxes at local bank branches. These relationships can be used to solicit voluntary bank garnishment of wages without turning to the court system. Expanding relationships with theseand other local banks can provide opportunities for capturing more delinquent tax liabilities.

St. Louis’ property tax collection rate, in comparison to comparable cities, tends to be low. TheCity’s average property tax collection rate from 1998 to 2008 is the second lowest of the ninecomparable cities The following shows the total percentage collected to date of each fiscal

Tax Collection

Table 45: Comparison of Property Tax Collection Rates (1998-2008)1

FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 A



Since the arrival of Collector of Revenue Daly, there has been a focus on water bill collectionsand the tax collection process has become more streamlined. The Office now files liens whenbills are not paid. In addition, the Office’s Compliance Division closely monitors business taxpayments to see if they are falling behind for a long period time. The goals behind this has beento “get in the door” ahead of other creditors and claims.

The Collector of Revenue has several unique, delinquent tax collection methods in place. One

effective requirement is that real property taxes need to be paid in order to renew a driver’slicense. After three years, the Office will initiate legal action and take possession of the propertyand sell it. Despite this progress, there are additional unexploited opportunities to improve St.Louis’ below average property tax collection rate.

In the License Collector’s Office, there have been biweekly reviews of Collector of Revenuereports detailing the number of employees at city businesses. These reports are compared to thenumber of employees listed on the original business license application. Discrepancies of between five and ten employees from the reports and the application prompt a letter to be sent tothe business asking for an explanation of the discrepancy

FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 Average

St. Louis 95.10% 100.40% 94.40% 100.30% 96.90% 100.80% 101.60% 100.10% 94.10% 100.50% 93.20% 97.95%

Kansas Ci ty 105.54% 95.13% 99.44% 99.48% 98.23% 102.98% 99.16% 98.64% 98.29% 98.39% 99.37% 99.51%

St. Charles 97.50% 97.70% 97.20% 97.90% 97.90% 98.20% 98.00% 97.30% 97.30% N/A N/A 97.67%Balt imore 99.00% 98.80% 99.00% 99.70% 97.60% 99.10% 100.30% 97.60% 97.70% 97.50% 94.10% 98.22%

Knoxville 99.82% 99.74% 99.69% 99.55% 99.48% 99.34% 99.35% 99.13% 99.01% 98.32% 95.63% 99.01%

Louisville2 N/A N/A N/A N/A N/A 99.50% 100.90% 102.20% 103.10% 102.90% 103.40% 102.00%

Minneapolis 99.50% 99.53% 99.13% 98.45% 98.25% 99.00% 98.78% 99.11% 98.80% 99.34% N/A 98.99%

Norfolk 100.57% 98.00% 101.50% 100.69% 100.02% 102.22% 101.37% 95.51% 93.21% 97.91% 98.30% 99.03%

Pittsburgh 101.60% 99.00% 98.80% 101.90% 102.00% 99.90% 97.90% 100.70% 105.10% 105.20% 104.10% 101.47%

Comparables

Average100.50% 98.27% 99.25% 99.67% 99.07% 100.03% 99.47% 98.77% 99.06% 99.94% 99.15% 99.49%

1Omaha's historical proper ty tax collection rates are not publically available2Data for Louisville prior to 2003 not available due to the city's 2003 merger w ith Jefferson County.

Tax Collection

have been limited and often do not allow for revenue estimates from specific fees and charges . In addition, there is a lack of control over the implementation of existing policies, which has led



to inconsistent collection procedures and practices in City departments.

While the Comptroller’s Office audits have prompted agencies to develop department-levelprocedures manuals, these efforts have not been consistent across all City departments. Forexample, a 2003-2004 Comptroller’s Office audit found a lack of written policies and proceduresin the Collector of Revenue’s real estate tax section. The section responded by drafting a writtenprocedures manual for the section; however this was not coordinated or developed in cooperationwith other tax and fee collecting departments.

The Recorder of Deeds has procedures on cashier daily operations and reporting and

investigation of cash shortages and surpluses, but the Comptroller’s audits have in the past foundthat despite this, cash shortages and surpluses have persisted without action. AnotherComptroller’s Office audit of the License Collector’s Office noted that there was a lack of effective procedures to ensure monitoring of taxable sporting exhibitions, which was eventuallyaddressed by the Office.

Intergovernmental Cooperation

While the City has made progress in establishing relationships with state and federal entities,there are many additional opportunities for increased coordination and cooperation with otherregional municipal governments. The City has worked with the Missouri Department of Revenue to establish a Fee Office in City Hall and has obtained taxpayer information from theIRS through its Government Liaison Exchange Program. In addition, the City has worked withtransportation development districts to pledge revenue in support of redevelopment projects.Despite these efforts, there remain several available opportunities for increased tax informationsharing. Among these include a partnership with the Missouri Department of Revenue on

streamlined state and local tax filing, and regional coordination of tax enforcement efforts, andtax and best practices information sharing with other regional jurisdictions.

Tax Collection

In addition, there are potential cost savings from a consolidated single payment site, reducingthe need for multiple payment vendors and IT contractors. In tandem with this option,



consider a tax simplification initiative to simplify the tax filing process. This can lead toincreased reporting of taxable income and assets while increasing tax collection rates.

2. Set up City Payment Centers

Set up a single payment center in City Hall for payment of city taxes, fees, and waterbills.

Set up satellite payment centers in other parts of the city to ease the convenience of tax and fee payment for citizens. This reduces the need to go to multiple offices inCity Hall for payment of multiple taxes and fees while allowing for improvedcustomer service to City taxpayers.

3. Create a Centralized and Sharable IT Platform for Tax Collection

Consider selecting a contractor to implement a centralized City IT platform for taxcollection. Set up a platform that allows for centralized tracking of tax accounts,collections, delinquencies, filing, and payment status.

Enable an interface with the City accounting system that allows for sufficient budgetand accounting control. This platform can increase the City’s ability to identify non-paying and delinquent taxpayers, keep track of unpaid tax liabilities and judgments,and monitor critical revenue streams.

Alternatively, consider significant upgrades and modernization of department tax andfee collection IT systems. Modernizing IT platforms can improve the ease of monitoring tax and fee revenue streams, enabling cost recovery analysis for cityservices and identification of collection rates for individual fees.

4. Explore Alternative Methods of Past Due Receivable and Tax Collection

Tax Collection

for a contract with current City tax collection agencies in a managed competition.Adopting this approach has the potential to dramatically improve the efficiency of



operations in City tax collection agencies. Consider posting an online delinquent taxpayer list on the City website. Posting a list

of delinquent earnings and property taxpayers can be an effective means of extractingpayment from large past due accounts. This has the added effect of discouraging lateor non-payment of taxes. Instituting a “whistleblower” program that financiallyrewards individuals that report business not paying taxes can be another way toaccomplish this goal.

Explore creation of an offset program with the Missouri Department of Revenue tocapture outstanding tax liabilities from individuals and businesses receiving paymentsfrom the state. These programs have been proven to be very effective in capturingpast due liabilities from delinquent taxpayers.

Consider taxpayer assistance programs that reduce the volume of delinquent filersand payments.

o Institute a tax deferral program that reduces the regressive effect of theproperty tax on low income homeowners. Defer property tax payments to alater date with a reasonable interest rate charge to give homeowners time topay the full amount of the tax payment.

Alternatively, set up a property tax circuit breaker program for low income, senior, ordisabled homeowners that caps an individual taxpayer’s liability at a percentage of income. This can reduce delinquent collection on these accounts while ensuring theintegrity of city property tax revenue streams that are sometimes threatened bydelinquent payments.

5. Establish Standard Accounts Receivable and Revenue Collection Policies

Develop standard policies for control over accounts receivable. Establish uniform

guidelines on delinquent account collection procedures, allowances for doubtful

Tax Collection

6. Make Greater Use of Performance Evaluation in Tax Collection

Set citywide tax collection targets as a platform to explore the effectiveness of current



Set citywide tax collection targets as a platform to explore the effectiveness of currenttax collection methods. Such efforts can motivate City staff to make more aggressive

efforts to recover tax revenue as well as identify opportunities for innovative ways toextract tax liabilities from delinquent taxpayers.

Increase the frequency and consistency of Comptroller audits of revenue collectionprocedures across the whole of City government.

Track and monitor the outcomes of delinquent and non-filer cases, to ensure thesufficient performance of third party collectors and the effectiveness of city staff inbringing in past due tax revenue.

7. Make Greater Efforts at Intergovernmental Cooperation on Tax Collection

Work with the Missouri Department of Revenue to set clear withholding guidelinesand clarify the kinds of goods and services that are subject to sales tax.

Consider an initiative to allow for streamlined joint State and City tax filing for theearnings and payroll taxes.

Explore creation of an offset program with the Missouri Department of Revenue tocapture outstanding tax liabilities from individuals and businesses receiving payments

from the state. These programs have been proven to be very effective in capturingpast due liabilities from delinquent taxpayers. Explore working with St. Charles and St. Louis Counties, which have recently

implemented ERP systems for tax collection and financial performance, to investigatethe feasibility and issues associated with installing such a system in St. Louis. Inaddition, consider information sharing and cooperation with these and other regionaljurisdictions on identifying regional patterns of tax fraud, evasion, and abuse.Establishing productive relations with other regional jurisdictions can also allow for

helpful regional coordination of tax enforcement efforts, affecting businesses thathave a regional presence. Such efforts can be coordinated through the existing

Tax Collection

Revenue Potential

Whil i i ibl d i f h h ddi i l b



While it is not possible to produce an exact estimate of how much additional revenue can berecovered through improved tax collection, based on the experience of other local governments,

it is likely that implementation of at least one recommendation would yield an additional $0.3million annually. Adoption of all options could yield up to $10 million annually.

These should be viewed as rough estimates – actual revenue potential will depend on the numberof recommendations adopted and the success of implementation. Additional revenues will bepartially offset by new upfront and ongoing costs associated with implementation andadministration.

These recommendations will likely require significant new upfront personnel, informationmanagement and private vendor costs, as well as new revenue policies and procedures.However, local governments have found that these investments can pay themselves within ashort period time when these costs are carefully controlled and monitored. Extra care should beexercised during implementation, so as to not jeopardize the City’s current fiscal position. It isalso worth exploring relationships with vendors where hardware and software enhancements willbe paid out of documented savings or additional collected revenue. These arrangements put the

onus on the vendor to improve performance before they get paid for the technology upgrades.

140



Tax Incentives

Tax Incentives

As with most large cities, St. Louis utilizes various tax and other incentives to foster economicdevelopment. This can have multiple effects on the City’s revenue structure – both positive and

ti A f ll ft d i ti k f i ti f t th d



negative. A carefully crafted incentive or package of incentives may foster growth anddevelopment in blighted or otherwise undeveloped areas of the city, stimulate activity that brings

in new business and industry, and augment city revenues. On the other hand, tax incentives maymostly subsidize activity that would have occurred anyway. In that case, the incentives merelyerode the overall revenue base while subsidizing businesses that gain a competitive advantageover existing city businesses that do not receive the same tax benefit.

To understand the potential positive and negative consequences, it is important to evaluate St.Louis’ economic development tax incentive policies and performance against comparable citiesand commonly accepted best practices and gauge their effectiveness in advancing the City’seconomic development goals. This assessment will serve as the foundation for recommendationsto enhance the City’s use of tax incentives for economic development.

The actual need for economic development tax incentives has been a matter of extensivediscussion and debate. Economic development incentives are often used to compensate for taxstructures that are not competitive with neighboring jurisdictions or otherwise unattractive tobusinesses and developers. In cases where an uncompetitive tax structure is the primary

motivation for offering tax incentives, it is arguable that modifying tax rates or structures wouldprovide a broad-based benefit with greater value than offering tax incentives to select projects.By lowering the cost of doing business across the board, a city may be able to create a betterclimate for economic growth.141 Alternatively, a well crafted set of incentives may provide acost effective means to attract new businesses and development without significantly reducingthe city’s overall revenue base.142 While this debate is likely to continue – as the relative meritsof each argument are strong – it may be largely an academic debate. In practice, nearly everylarge city utilizes tax and other incentives for economic and community development.

St. Louis uses a variety of development incentives, including business development loan

Tax Incentives

Tax Increment Financing

Tax increment financing (TIF) is one of the City’s most frequently used economic development



Tax increment financing (TIF) is one of the City’s most frequently used economic developmenttools. Widely used throughout the country and particularly in the Midwest,143 TIF provides a

method for financing development projects by allocating the additional tax revenue generatedfrom increased property and economic activity taxes to a special fund to be used forimprovements within the TIF district. This fund can be used to cover expenditures in the projectarea, ranging from public infrastructure to direct construction costs. TIFs can be set up fordistricts encompassing multiple properties or for single projects.

In practice, St. Louis has used TIF primarily for individual projects; only three multiple projectTIF districts are currently in place. In St. Louis, property taxes paid to state and localgovernments for TIF projects are frozen for a maximum of 23 years (the additional property taxgenerated by increased assessed valuation flow into the TIF special fund). These additionaltaxes are collected by the City as Payments In Lieu of Taxes (PILOTs). Fifty percent of thedistrict’s economic activity taxes (EATS), which include City sales, utility, and earnings taxes,are also allocated to the fund. Although common in Missouri, setting aside EATS is not a typicalpractice among other comparable cities; it serves as an additional incentive for developers topursue TIF projects in St. Louis.

TIF Policy

St. Louis’ TIF policies are designed to achieve key economic development goals, including jobcreation and retention, reduction of blight, increased property values, increased tax revenues,reduced poverty levels, economic stability and self-sufficiency, healthy stable neighborhoods,and a strengthened employment and economic base.

To achieve these goals, the City maintains the following TIF development policies:

Tax Incentives

11. Projects involving redevelopment of existing retail, commercial, office or industrialproperties should stabilize areas that will likely experience deterioration.

12 Retail and commercial projects should attract customers from outside the City or fill retail



12. Retail and commercial projects should attract customers from outside the City or fill retailmarkets that are in short supply.

13. Compliance with City Ordinance #60275 relating to a “first-source" agreement with the St.Louis Agency on Training and Employment is required.

14. Projects in existing residential neighborhoods should stabilize areas that have or are likelyto experience deterioration.

15. New residential projects should fulfill a significant housing need for the City's currentpopulation without substantially impacting public services and facilities.

16. Residential developments must include a diversity of household income levels.17. Business area redevelopment projects should include information on business type and

major tenants, population areas from which the project will draw and businesses that wouldcompete with TIF area businesses.

18. Projects that do not combine TIF incentives with real estate tax abatement are preferred.

The City also specifies that if certain minimum requirements are not met, the amount of TIFassistance may be reduced. These requirements consist of:

Minimum employment levels Deadline for completion of public infrastructure construction Deadline for completion of TIF project

TIF eligibility is heavily influenced by the “but for” test– the determination that the developmentwould not have occurred “but for” the offering of the incentive.144 Financing is provided onlyafter projects are stabilized and beyond the early years of development risk. In addition, toensure TIF-financed developments produce good financial outcomes for the City, there is a

clawback policy requiring that in the event a developer’s net income exceeds the initiallyprojected amount, the amount of City TIF financing will be reduced by 75 percent of the excess.

Tax Incentives

comprehensive redevelopment of the North Side indicates there are still opportunities foradditional redevelopment activity. This project was aided by passage of a state special landassemblage tax credit designed to assist this particular development Although the



assemblage tax credit designed to assist this particular development. Although thedevelopment’s TIF application calls for only 5 percent of project costs to be financed by TIF, the

size of the project’s financing would represent 69 percent of the City’s total TIF commitmentssince 1986.

The City has used TIFs to attract new businesses downtown, in many instances to compensatefor the effects of the earnings tax. Many of these targets have been small to medium sizedbusinesses that highly value a downtown location; downtown currently lacks an abundance of large corporate tenants.

The following table details the types of projects receiving TIF subsidies in St. Louis andcomparable cities:

Table 46: TIF Project Types145

St. LouisKansas

CityOmaha Baltimore Minneapolis

Number of

Projects/Districts 106 110 169 9 109

% CommercialProjects

1

31.1% 31.5% 40.2% 11.1% N/A

% ResidentialProjects

2

50.0% 2.7% 40.2% 22.2%Mostly

residential

% Mixed UseProjects

22.6% 37.8% 8.3% 11.1% N/A

% Retail Projects 18.9% 8.1% N/A3

22.2% N/A

Tax Incentives

experience with TIF, has struck a relative balance between retail, industrial, and residentialprojects, with commercial and mixed use combined also comprising an equal share. At the otherend of the spectrum Minneapolis’ TIF projects are almost entirely residential projects that target



end of the spectrum, Minneapolis TIF projects are almost entirely residential projects that targetaffordable housing.

In recent years, the City has reduced its financial commitment to TIF projects, as shown in thefollowing table:

Table 47: TIF Revenues and Expenditures

FY2005Actual

FY2006Actual

FY2007Actual

FY2008Actual

FY2009Projected

FY2010Projected

Revenue $4,722,624 $4,153,313 $4,153,313 $7,530,061 $2,932,000 $2,893,000Expenditures $4,722,624 $4,153,313 $7,633,500 $7,530,061 $2,307,572 $2,893,406

DIFFERENCE $0 $0 -$3,480,187 $0 $624,428 -$406

Despite a $3.5 million deficit in FY2007, TIF expenditures have generally kept pace withrevenues. The unusually high expenditures during FY2007 and FY2008 were due to the City’s$17 million TIF bond issue in support of the One City Centre Redevelopment Project. This

project will require General Fund support if incremental tax revenue is not sufficient to coverbond payments. For FY2009, there is a $624,428 projected surplus and FY2010 expendituresare expected to be roughly on par with revenues.

TIF Best Practices

TIF use has generated numerous studies, surveys, and reports by academic, industry, and publicinterest groups. They have identified a generally accepted set of common best practices for

designing, structuring, and maintaining a TIF program. These provide unique insights on theappropriate policies requirements and tools cities can use to maximize the return on their TIF

Tax Incentives

Conducting a property value growth analysis of the project’s surrounding area can be helpful inmaking the “but for” determination.146 TIF applicants generally emphasize that a developmentwould not have occurred without public support through TIF However this often does not



would not have occurred without public support through TIF. However, this often does notconsider the possibility that a smaller city revenue commitment might also make the project

feasible or that alternative projects might yield greater economic benefits to the city.147

The cost-benefit analysis is a critical component of the TIF application review process. Itenables the city to identify and evaluate the potential direct costs and benefits of a proposeddevelopment as well as any positive and negative externalities. Often, TIF cost benefit analysesmerely focus on the financial cost and benefits of new projects while ignoring intangible factors.It is considered a best practice to evaluate the potential effects projects will have on quality of life, surrounding property values, demands on city services and job growth.148 TIF projectsshould serve as a catalyst for new development and economic growth that does not require citysupport. This reduces the need for additional city revenue commitments in support of developments.

Cost benefit analyses should be conducted independently or by the city and not by developers.An objective party should examine the full costs and benefits of a project to determine if aproject is genuinely in the city’s interest to support. To guide this, there should be a set policy

and process for conducting a cost benefit analysis, to ensure that differing methodologies do notaffect the final outcomes of TIF application evaluations.

Targeting to Meet Development Goals

Cities across the country have been increasingly using TIF to achieve certain strategicdevelopment goals. These strategies often have special requirements that conform city-subsidized projects to these goals. In practice, it is often effective to limit city funding to

projects that meet these conditions, and to avoid subsidizing projects that do not.

Tax Incentives

offered for development of healthy, prosperous areas, often temporarily shifting consumerspending and tax revenue from one part of the metro region to another.151



This is a key area for concern with TIF utilization in Missouri. While the amount of property tax

that state and local governments receive during the life of a TIF is frozen, the services thatgovernments provide to the TIF will generally increase in cost over its life. This may beconsidered acceptable if the area is unlikely to see substantial economic growth or activity – inthat case, it is likely that the property value would not increase appreciably without governmentassistance. This is not necessarily the case for many TIF projects in Missouri. In a situationwhere regular growth in property value would be expected to occur without the TIF investments,TIF is economically inefficient – the governments are foregoing expected revenue growth, andthe TIF investments are probably not necessary to achieve economic growth and activity in thearea.

To better target resources to areas in genuine need of redevelopment, it is more efficient tosubsidize TIF projects in economically disadvantaged areas that have a harder time attractingprivate investment. Investments in these areas have the greatest potential to catalyze additionalprivate investments.152 This utilizes tax incentive resources for critical projects and protects thecity’s property tax revenue base from an over commitment of city resources to TIF.

It is also often best to target TIF subsidies to public infrastructure improvements in support of developments. These expenditures are more likely to have a spillover effect of increased areaproperty values and property tax collections and make additional private development activityand investment more attractive. Moreover, targeting public improvements insulates the city fromoperational risks that may arise in construction or rehabilitation of structures.

Retail-only developments are, for the most part, poor candidates for TIF subsidies. These

developments often create lower wage, lower quality jobs and have little positive effect onsurrounding property values.153 Although widely utilized in suburban communities outside St.

Tax Incentives

can derail a project later on or significant increase its cost. Some cities draft communicationplans to improve dialogue with key stakeholders and community residents. Meetings, focusgroups and community forums are used to educate and engage neighborhood political and



groups, and community forums are used to educate and engage neighborhood, political andbusiness community stakeholders that can often later be called in to provide critical support in

times of need.

It is also helpful to coordinate TIF districts with existing community or business improvementdistricts. This can maintain the district identity and establish the district as a favorable candidatefor additional private investment and state and federal grants. Leveraging these resources canalso reduce the city’s required tax revenue commitment for TIF projects.

Financial Protections

It is not uncommon for TIF projects to yield tax revenues that fall short of estimates presented inthe initial TIF application. As a consequence, there may be an insufficient amount of fundsavailable to pay TIF bond principal and interest. Kansas City has had significant experience withthis, often having to use General Fund revenue to cover TIF Bond payments for underperformingTIF districts.155 A tool cities have used to deal with this concern is the creation of special taxdistricts. Special tax districts impose special property tax levies on TIF projects that fail to

generate enough revenue to cover TIF bond payments. They allow the city to shift the risk of project failure to the developer by requiring the developer to bear a greater percentage of theproject cost when tax revenues are lacking. Baltimore, MD has successfully used them torecover the costs associated with underperforming TIF developments.

Another means to accomplish this is by setting a ceiling on the total percentage of assessedproperty valuation subject to TIF, or avoiding TIF funding for districts that account for a largeportion of assessed property valuation. These measures protect the city against erosion of the

property tax base caused by excessive use of TIF.

Tax Incentives

Comparative Analysis of TIF Policies

TIF policies vary significantly by city because of differing state requirements and city economic



TIF policies vary significantly by city because of differing state requirements and city economicdevelopment goals. Generally, they are designed to ensure accountability and limit the use of

TIF for developments that would be profitable without city support. The following tablepresents the respective TIF policies and requirements of the comparable cities:

Table 48: Comparable TIF Policies

St. Louis Kansas City Omaha Baltimore Minneapolis

Maximum TIFDistrict Term

23 Years(State Statute)

23 Years(State Statute)

15 Years40 Years

(State statute) 25 Years

# of Current TIFProjects/Districts

116 110 1691 9 101

Cost-BenefitAnalysis

Requirement?By Whom?

Yes, Applicanthires consultant

or attorney, workswith City

Yes, Applicanthires consultant

or attorney

Yes, Either City orApplicant hiresconsultant or

attorney

Yes, BaltimoreDevelopment

Corporation staff

Yes, byconsultants underthe supervision of

City staff

Require "ButFor" Test?

Yes Yes Yes Yes Yes

Eligible Uses

Blight, economicstability,

employmentopportunities

Blighted areas,conservation

areas, oreconomic

developmentareas

Redevelopingsubstandard &blighted areas.

Developmentdistricts (blighted)

Redevelopingblighted areas

TIF Benefits

Property taxesfrozen for up to 23years- PILOTS +50% of sales andutility taxes paid

to special

Property taxesfrozen for up to 23years- PILOTS +50% of sales andutility taxes paid

to special

Property taxfrozen for up to 15

years, PILOTsallocated to

financing publiccosts associated

Property taxesfrozen up to 40years- PILOTS

allocated tospecial fund thatpays debt for cityexpenditures in

Additionalproperty taxes

paid as a result ofthe development

allocated to afund paying for

part of the

Tax Incentives

collaboration with the City, and the City often undertakes its own internal analysis. The City’smaximum TIF term, at 23 years, is roughly in the middle of the pack and is the maximum termallowed by Missouri state law.



allowed by Missouri state law.

As in Baltimore, St. Louis most often uses city-backed bonds to finance improvements.However, St. Louis uses TIF notes (notes issued to the developer during construction that arerefunded with the issuance of the TIF Bonds or other permanent long-term financing after thecompletion of the project). Omaha has a unique system where the developer loans the City fundsthat are disbursed back to the project or used for public improvements. The tax increment is thenrefunded to the developer to amortize the loan. This tax increment is only applied after taxpayments have been received by the City. Under this system, the full faith and credit of the Cityof Omaha is never pledged to any particular development. This keeps the city from making asubstantial revenue commitment upfront that is eventually paid back with long term incrementaltax revenue. In general, pay-as-you-go systems are regarded as the safest financing methods forTIFs, as expenditures are closely related to the incremental tax revenue generated from thedistrict.

158

TIF Guidelines and Requirements

The comparable cities employ a variety of innovative TIF policies that increase their ability to bemore selective in choosing TIF eligible projects. The following table presents uniquerequirements and guidelines imposed by the comparables to achieve specific city goals:

Tax Incentives

Table 49: Comparable TIF Guidelines and Requirements

Minneapolis Omaha Baltimore Kansas City



In addition, the comparable cities have selected a set of unique factors to be considered in theinitial TIF cost benefit analyses. These criteria are described in the following table:

Table 50: Comparable Cost Benefit Analysis Criteria

TIF subsidy restricted to

developments meeting

specific city developmentobjective

Must eliminate actual or

potential hazard to public

TIF Bonds must be secured

by guarantee of at least onedeveloper

Project should focus on

building small business ormicroenterprises

Only public improvements and

public redevelopment costs

are eligible for TIF

Only public improvements are

eligible for TIF

Tax increment in excess of

unpaid debt service is

allocated to the city for use

for any purpose

Project should promote

access to and financial

support for public transit

Periodic city review of excess

tax increments required to

determine if reduction of TIF is

necessary

Project should create at least

one job per $10,000 value in

TIF loan

A special tax district must

be created for each TIF to

recover the cost of debt

service on TIF bonds if

incremental tax revenue isinsufficient

Project should promote

crime reduction and

enhance perception of

safety

Rigorous economic analysis

and risk assessment are

performed for each project

Rehabilitation of city landmarks

favored

The total assessed property

valuation of TIF districts

can not exceed 4 percent of

the city's taxable property

Project should preserve,

enhance, or build

infrastructure in areas

defined by the City

Project should be in area with

declining pattern of property

assessment

Project should request less

than the maximum duration

and extent of incentives

available

Project should create newbusinesses or business

operations

Project should proposedevelopment adjacent to

areas of existing

development activity

Minneapolis Omaha Baltimore Kansas City

Job creation and new Tax shifts resulting from grantI i J b

Non financial costs and

Tax Incentives

Table 51: TIF Financial Performance159

St. Louis Kansas City Omaha Baltimore1

Minneapolis



Number of

Projects/Districts

106 110 169 9 101

Average ProjectCost

$33,713,050 $79,037,340 $14,744,555 $81,397,663 N/A

Average TIF Term 22.9 25 13.28 N/A

Residential:20-25 years;Commercial:

15 years

Average PILOTRevenue Since

Project Inception2

(per project)

$737,183 $2,202,586 N/A $550,777 $811,881

Average EATrevenue since

project inception3

(per project)

$498,189 $2,766,147 N/A N/A N/A

Average TIFFinancing as % ofTotal Project Cost

17.3% 41.2% 11.2% 21.9% N/A

Average Ratio TIFFinancing toProject Cost

6.4 to 1 5 to 1 9.9 to 1 4.8 to 1 N/A

Source: Internal PFM analysis based on Missouri Department of Economic Development 2008Financing Annual Report; TIF data supplied by Omaha Planning Dept.; Baltimore City Council0073R, 11/03/08.

1Excludes TIF financing for City-owned properties2Operational projects

only3Ibid

A th bl iti St L i fi l t f j t t th K

Tax Incentives

Table 52: Job Creation Performance161



Actual

New Jobs% of

Projected

Actual

RetainedJobs % ofProjected

% Projects

ExceedingProjected

Jobs

% Projects

FallingShort ofProjected

Jobs

% Projects

ExceedingProjectedRetained

Jobs

% Projects

Falling Shortof ProjectedRetained

Jobs

St. Louis 56.0% 90.0% 15.3% 37.3% 0.0% 3.4%

Kansas City 56.4% 85.7% 31.4% 51.0% 11.8% 3.9%

The job creation and retention performance of St. Louis TIF projects is roughly on par with that

of Kansas City. However St. Louis outperforms Kansas City on the percentage of projectsfalling short of projected jobs, with 37.3 percent of projects falling short as opposed to 51.0percent in Kansas City.

St Louis has, at times, pledged General Fund revenue for TIF projects. Although this practice iscommon in Kansas City, it is generally not the norm for the benchmark cities -- or most citiesacross the country. In addition, numerous studies of TIF best practices have recommended thatGeneral Fund subsidization of TIF projects be avoided.162

St. Louis requires that TIF financing make up no more than 15 percent of total project costs.However, on average, TIFs have made up about 17.3 percent of total project costs.163 The City’sTIF regulations allow for this requirement to be waived for redevelopment of existing structuresor the assembly and clearance of land upon which existing structures are located. The effect of this has been that over half of the City’s TIF projects in operation have exceeded this amount,requiring a larger net revenue commitment than was perhaps originally envisioned.

Tax Incentives

Evaluation of TIF Program

St. Louis’ use of TIF has been driven by its need to redevelop older, vacant properties into more



y p p pprofitable developments. The City has been successful in catalyzing developments that have led

to above average increases in City job and wage growth. However, in the process, whether theseprojects actually achieve City development goals and produce satisfactory financial results coulduse additional consideration. The City has instituted a number of requirements designed to alignTIF subsidized projects with City goals. However, project selection has not been driven byfulfillment of City goals, merely influenced by it. There is room for improvement the process.As noted in at least one City interview, TIF performance evaluation has, at times, been sporadic.Financial reviews are focused on project costs and income, with little attention paid to jobcreation or tax revenue receipts. A lack of extensive monitoring prevents the City from gauging

progress toward meeting development goals and targeting TIF subsidies to the most profitable,economically beneficial projects.

St. Louis maintains a TIF policy that clearly outlines the City’s development goals. However,these goals are not always directly aligned with guidelines for TIF project selection andevaluation. In addition, the intangible effects of TIF projects on quality of life, property values,and public safety are also not regularly gauged or evaluated following approval.

The initial cost benefit analysis tends to focus on the economic benefit to the City and taxingjurisdictions. The focus is primarily on whether these projects will produce increased revenuefor all taxing jurisdictions. The lack of clear guidelines and requirements for the cost benefitanalysis can lead to variability in analysis methodology that can influence TIF approvaloutcomes.

While the City provides assistance with project application, reviews the developer cost benefit

analysis, and conducts a limited internal analysis, these sometimes lack the depth and rigorrequired to fully gauge a development’s impact on city revenues. In addition, the lack of an

Tax Incentives

2003, the City used its block grant entitlement to back bonds in support of the RenaissanceGrand Hotel and Suites development. By 2009, the hotel had failed to meet revenue andoccupancy projections and had been foreclosed on by bondholders. The hotel failed to generate



p y p j y genough tax revenue to pay down the bonds and the City was forced to use $13.6 million in block

grants to pay down the bonds over five years.164

In addition, the City has sometimes supported retail-only developments that have failed togenerate a long-term positive economic impact, while leaving the City on the hook forsubstantial debt payments. The City’s first TIF project, the 500,000 square foot St. LouisMarketplace retail development, initially attracted a number of big box retailers that eventuallyvacated the shopping center, leaving the City with little tax revenue to pay the 7.5 percent interest ondevelopment bonds.165

Communication and coordination with key City stakeholders is also a concern. While the CityTIF Commission holds public hearings on each development, the full scope and nature of developments are not always communicated to community stakeholders. Recently, the proposedSecond Baptist Church redevelopment, which included a new dining and entertainment venuegenerated community opposition when it was learned that the project would include a restaurantwith a liquor license. This sort of community opposition can cause costly delays that increase therequired city revenue commitment to make the project viable. This opposition might be avoided or atleast mitigated with an effective communication plan and strategy for community engagement.

Currently, St. Louis uses bonding to finance TIF projects. Under the current TIF system,developers receive TIF notes repaid with TIF bonds backed by incremental tax revenue in thespecial allocation fund. Although this system places much of the upfront cost on the developer,it does not closely match project expenditures to the incremental tax revenue generated from thedistrict and incurs additional interest and transaction costs that reduce the amount of tax revenuethat the City can retain or extract from new developments.

P tl th i i i l t l th t f t d l th t i bj t t

Tax Incentives

Require regular reporting of job creation, wage, and employment data in addition tofinancial reports for approved TIF projects. This improves developer accountability andtracks fulfillment of initial job creation performance.



Evaluate TIF project progress in fulfilling City development goals.

Monitor each project’s progress toward fulfilling City job creation and employment,affordable housing, property value, and wage growth goals.

Consider the amount of additional private investment leveraged by the development. Regularly and actively evaluate initial tax revenue estimates against actual collections.

This ensures that projects that generate tax revenue well below initial estimates aresubject to a clawback or other reduction in the TIF subsidy.

These evaluations can help the City target future TIF subsidies to projects meeting City goals

and allow the City to adjust its financial commitment in tandem with project fulfillment of thesegoals.

2. Align Projects with Specific Development Goals

Select projects that focus on specific objectives -- be it sustainable development, jobcreation, or wage growth. The City should take the initiative in deciding which types of projects receive TIF funding.

Consider selecting TIF projects focused solely on accomplishing specific City objectives,such as affordable housing, “living wage” job creation, or neighborhood stabilization.The accomplishment of these goals can further improve the City’s revenue position byincreasing City resident incomes and neighborhood property values.

One tool to accomplish this is adopting a points-based evaluation system for TIF projects.Currently adopted by the cities of Austin166 and Dallas, TX, points systems evaluate

developments based on a set of city criteria such as economic and fiscal impact, publicinfrastructure and benefit, neighborhood effects, location, or design. The greater impact a

Tax Incentives

4. Restrict Use of TIF Funds

Establish clear, comprehensible City policies on eligible uses of TIF funds. Determine



acceptable and unacceptable uses of TIF funds beyond state requirements to target City

subsidies toward essential expenditures critical to the completion of the project. Direct TIF funds to public improvements instead of direct development support. Consider restricting financing to public improvements costs only, targeting projects that

are likely to have an effect on neighboring property value, thus increasing the propertytax base.

5. Solicit Community and Stakeholder Buy-in and Feedback

Actively engage community, business, and neighborhood stakeholders in the TIFplanning process.

Design and execute a communications plan to solicit the input, feedback, and engagementof political, business, and neighborhood stakeholders in TIF projects. Execution of a plancan reduce delays caused by community opposition and reduce the required City taxcommitment for a development while ensuring that projects are aligned with communitydevelopment goals and expectations.

6. Consider Use of Pay-as-you-go Financing

Shift to a pay as you go system that protects the City from providing significant upfrontfunding.

Consider designing a structure that keeps the upfront financing liability on the developer,and fund project expenditures directly from tax increment revenue. Such a system issafer, less prone to interest rate fluctuations from bond transactions and ties project tax

revenue directly to project expenditures.

Tax Incentives

In addition, adopt a policy banning the use of General Fund and other City revenuesources in support of TIF projects, to reduce subsidization of underperforming TIFprojects.



Also consider further limiting the types of projects that can exceed the 15 percent cap on

the percentage of total project cost subsidized. These measures supplement clawbacks astools to protect the City when incremental tax revenue is not sufficient to cover TIFbonds.

Tax Abatement

Tax abatement is another incentive commonly employed by the City as an economicdevelopment tool. In St. Louis, tax abatements freeze the tax assessment of new improvements

at the pre-development level. By statute, tax abatements can last up to 25 years, with the first 10years eligible for full abatement and the remaining 15 years eligible for 50 percent abatement.Those greater than 10 years are required to show extraordinary cost, development obstacles, orextraordinary impact.

While TIFs tend to be used more selectively to finance particularly important downtowndevelopment projects, tax abatements have been applied throughout the City on a widespreadbasis in broad redevelopment areas. Tax abatements also tend to be approved more quickly thanTIFs and are typically subject to less scrutiny and review. However, like TIFs, the use of taxabatement can have a significant impact on a city’s property tax revenue stream.

Tax Abatement Policy and Requirements

Tax abatement is available anywhere the City has designated by ordinance as a redevelopmentarea. Those that are not must be approved as a redevelopment area by either the Land Clearance

for Redevelopment Authority or the Planned Industrial Expansion Authority in addition to theBoard of Aldermen. In practice, properties in areas of the City that are part of the State

Tax Incentives

Overview of Use

Tax abatement in St. Louis has largely been determined by whether areas are able to receive



designation as a redevelopment area. Since tax abatement is open to any residential,

commercial, or industrial project in redevelopment areas, a large number of projects have beeneligible for financing. The tax abatement program has been in effect for many years; as a result,many parcels have received multiple rounds of tax abatement throughout their history. 167

Tax Abatement Best Practices

Although not gaining as much attention as TIFs, property tax abatements have also been thesubject of much study by universities, industry, and public interest groups. The following list

common benefits with the proper use and structure of tax abatement programs.

Tax abatements are often used as incentives to attract businesses that have the option of locating elsewhere. In particular, they are used by cities with business tax structures lesscompetitive than neighboring jurisdictions to enhance their regional competitive position.For this reason, tax abatements should not be granted to businesses incapable of locatingelsewhere.

Tax abatements should be evaluated to determine if the development will impose

additional fiscal stress through the required extension of city services. If the increase intax revenue from the new development is not sufficient to cover these costs, taxabatement is not advisable.168

It is often best to calculate the full benefits from a tax abated property by putting a dollarvalue on the tangible benefits generated by the developments. Impacts on job creation,property values, and neighborhood aura should be considered before granting taxabatement.169

Longer-term tax abatements are generally inadvisable, as they increase the possibilitydevelopments will become economically obsolete before they start generating new

t t

Tax Incentives

Comparative Analysis of Tax Abatement Policies

The comparable cities have divergent property tax abatement policies, each in line with theirparticular economic development goals The following table details the respective tax abatement



particular economic development goals. The following table details the respective tax abatement

policies of the comparable cities:

Table 53: Comparable Tax Abatement Policies

As in other comparable cities, St. Louis limits development property tax abatements to 10 years,with the option of an extension. In addition, the City targets tax abatements to Enterprise Zones

St. Louis Kansas City Baltimore Minneapolis2

Omaha3

Eligible Property

for Abatement

Any new development or

renovation property in

city upon approval of the

Board of Aldermen.

Enterprise Zones

preapproved

Enterprise Zone,

Enhanced Enterprise

Zone, Urban

Renewal Area

Enterprise Zone,

Manufacturing Facilities

Historic Properties,

Areas receiving

improvements to

Public Infrastructure.

Businesses meeting

state new investment

and job creation criteria

Length of

Abatement?

10 Years, Possible 15

more at 50%

10 Years, Possible

15 more at 50%1

10 Years for Enterprise Zone,indefinitely for Manufacturing

Personal Property with annual

renewal

Varies, PublicInfrastructure

program ends August

1, 2009

Real Property Tax, up to10 years; Personal

Property Tax, up to 15

years

Cost Benefit

Analysis

Required?

NoYes (Tier 1 projects

only)No Yes No

Job Creation

Criteria?No No Yes Yes Yes

Property Tax

Eligible for

Abatement

100% abatement of city

property tax on added

value of new

development.

50% property tax

abatement for 10years for real estate

improvements

(can be extended for

an additional 15

years)

80% credit against portion of

real property improvements.

Drops 10% annually after five

years. 80% for full 10 years if

located in Focus Area. 100%

exemption of manufacturing

personal property.

Up to 100%

Reduction or total

abatement of real and/orpersonal property tax

liability, depending on

nature of business and

amount of new

investment and job

creation

1In some portions of downtown Kansas City, tax abatement can be 100% for 25 years.

2One of six conditions. Project must meet at least one.

3Nebraska Advantage state program. The City of Omaha does not offer commercial property tax abatements or exemptions.

Tax Incentives

Table 54: Comparable Tax Abatement Guidelines and Requirements

Minneapolis Omaha170

Baltimore Kansas City

OBusiness must make

f



Requires public hearing

and City Councilhearing

Only real property

acquired or built duringthe entitlement periodeligible

Business must makecapital investment in

property or hire at leastone new employee inEnterprise Zone

Independent financial

analysis required for Tier1 tax abatements (100%abatement for 25 years)

Must do one of thefollowing: increase orpreserve tax base,provide new jobs,redevelop blightedareas, provide accessto services for city

residents, improvepublic infrastructure,increase market valueby over 50%

Real property tax creditand personal propertytax exemption issued tobusinesses with $10million in investmentand 75 new jobs or

$100 million ininvestment and 50 newjobs

Personal property taxcredit requiresexplanation ofmanufacturing orresearch and

development process ofbusiness

For Tier 1 abatements , atax impact analysis mustbe performed thatcalculates the taxablevalue of improvements for

which developer isrequesting abatement

Only properties withHistoric Preservationeligible

Personal property taxexemption issued tobusinesses with $10million in investmentand 100 new jobs

Personal property taxexemption applicantsmust provide anitemized list ofexempted assets todescribe how they are

used

Submittal of Projectbudget, pro forma,sources of funds, andcalculation of effect ofabatement on developerreturn on investment

requiredTax abatement allowedonly for rehabilitation ofproperty

Tax Abatement Evaluation

In St. Louis, it has generally not been difficult to secure tax abatement. The City’s criteria are

broad enough to include a variety of developments that may or may not align with the City’seconomic development goals. In addition, the approval of tax abatement is heavily influenced by



Tax Incentives

5. Improve Tax Abatement Recordkeeping to Allow Broader Analysis and

Comparisons

Evaluate and revamp the property record management system to discern abatement



Evaluate and revamp the property record management system to discern abatement

patterns and gauge the total amount of incentives offered to single developers.

6. Set a Cap on the Percentage of Property Assessed Valuation Subject to Abatement

Restrict the unfettered growth of tax abatement to the point where it can significantlyundermine the property tax base. Continually track and monitor the percentage of assessed valuation abated.

7. Restrict Tax Abatement Eligibility to Blighted Areas Only

Focus tax abatements on economically depressed areas most in need of redevelopment.Use narrower, more restrictive criteria for designation as a redevelopment area. Thisreduces the likelihood of subsidizing developments that would have occurred without taxabatement



Appendix A: Summary of Information

and Activities

Appendix A

Appendix A- Summary of Information and Activities

I. Primary Sources



A. In-Person Interviews with City of St Louis Elected Officials and Staff

PFM conducted in-person interviews with the following staff and elected officials from the City

of St Louis, Missouri:

Ed Bushmeyer, Assessor, Assessor‟s Office Melba Moore, Commissioner of Health, Department of Health and Hospitals

Paul Payne, Budget Director, Budget Division Catherine Ruggeri-Rea, Court Administrator, City Courts

Curtis Skouby, Director of Public Utilities, Department of Public Utilities,

Ron Smith, Chief of Staff, Mayor‟s Office

Barbara Geisman, Executive Director for Development, Mayor‟s Office

Larry Williams, City Treasurer, Treasurer‟s Office

Tom Stoff, Chief of Staff, Treasurer‟s Office

John Zakibe, Deputy Comptroller, Comptroller‟s Office

Beverly Fitzsimmons, Accounting Manager, Financial Reporting, Comptroller‟s Office James Murphy, St. Louis Sheriff

Randolph Lynch, Major, Department of the Sheriff

Alderwoman Jennifer Florida Alderman Stephen Gregali

Rodney Crim, Executive Director, St. Louis Development Corporation

Otis Williams, Deputy Executive Director, St. Louis Development Corporation

Charles Hahn, Controller, St. Louis Development Corporation

Melanie Pelletier, Director, Human Resources, St. Louis Development Corporation Dale Ruthsatz, Director, Commercial Development, St. Louis Development Corporation

Appendix A

Ruth Sergenian, Director, Economic Policy and Analysis, St. Louis Regional Chamberand Growth Assoc.

Enos Moss, CFO/Treasurer, St. Louis Public Schools



C. Interviews with Comparable Government Officials and Outside Subject Matter Experts

PFM conducted interviews with the following comparable government officials and outside

subject matter experts:

Dan Bohrod, Budget Analyst, City Comptroller, Madison, WI

Don Schulte, Active Government Solutions

Troy Schulte, Budget Officer, Kansas City, MO

Mark Winkelhake, Senior Development Finance Analyst, Minneapolis, MN Dr. Joseph Haslag, Executive Vice-President, Show-Me Institute, Columbia, MO

Dr. Robert Inman, Richard King Mellon Professor of Finance, University of

Pennsylvania, Philadelphia, PA

D. Official Government Documents

City of Boston, MA. FY2010 Recommended Budget, Revenue Estimates and Analysis, page

105.

City of Boston. “Presentation on PILOT Revenue Initiatives and ARRA”. Boston Department of

Administration and Finance. 26 February 2009.<http://www.cityofboston.gov/administrationfinance/pdfs/Presentation%20on%20PILOT

%20Revenue%20Initiatives%20and%20ARRA%2002%2026%2009.pdf>.

City of Madison, WI. 2009 Operating Budget, 2009 Adopted General Fund Revenues, pp 14-15.

Appendix A

waste/billing.asp>

City of Minneapolis, MN. “Economic Development Methods in Minneapolis: Council StudySession October 1 2004 ” 1 October 2004



Session October 1, 2004. 1 October 2004.

City of Omaha, NE. Tax Increment Financing Guidelines. November 2001.

City of St. Louis. “City Finance Committee Draft recommendations to the Board of Estimate and

Apportionment.” 31 January 2006.

City of St. Louis. “Staff Report to the St. Louis Tax Reform Commission.” June 1987.

City of St. Louis. “Top Employers.” City of St. Louis FY2010 Proposed Budget. Page A-17.

Congressional Budget Office. “Economic Issues in Taxing Internet and Mail-Order Sales.”October 2003.

Congressional Research Service. “State and Local Sales and Use Taxes and InternetCommerce.” 9 March 2006.

Florida Property Tax Reform Committee. “Preliminary Report and Recommendations.”December 2006.

Kansas City Tax Increment Financing Commission. Policy and Procedures Handbook. May

2006.

Missouri Department of Economic Development. 2008 Tax Increment Financing AnnualReport. March 2009.

N Y k Ci I d d B d Offi “C i S d L l T i L U S

Appendix A

Wisconsin Joint Legislative Audit Committee. “Best Practices Report: Local Government User

Fees.” Legislative Audit Bureau. April 2004.

Wisconsin Legislative Fiscal Bureau “Local Government Revenue Options ” Informational



Wisconsin Legislative Fiscal Bureau. Local Government Revenue Options. Informational

Paper 15. January 2005.

United States Bureau of the Census. 2007 American Communities Survey.

United States Bureau of the Census. 2007 State Tax Collections.

United States Bureau of the Census. 2006 State and Local Revenue.

United States Bureau of the Census. 2007 Census of Governments.

United States Bureau of the Census. 2002 Census of Governments.

United States Bureau of the Census. Quarterly Workforce Indicators. First Quarter. 2008.

United States Bureau of the Census. “State and Local Government Finances by Level of Government and by State: 2005-2006.”

United States Environmental Protection Agency. “2006 Pay As You Throw Programs,”<http://www.epa.gov/waste/conserve/tools/payt/states/06comm.htm#text>

United States Government Accountability Office. “Update to State and Local Fiscal Pressures.”January 26, 2009.

II. Secondary Sources

P I Li f T

Appendix A

Public Financial Management, Inc and Eckert Seamans Cherin & Mellott, LLC. “MunicipalitiesFinancial Recovery Act, Recovery Plan, City of Pittsburgh.” 2004.<http://www.city.pittsburgh.pa.us/council/assets/04_ACT47Plan-Je11.pdf>.



Shanley, Brian J. “Student fee would break bond of trust.” Providence Journal. 17 May 2009.

Wahlberg, David. “Madison receives payments in lieu of taxes from some nonprofits.”Wisconsin State Journal. 26 January 2009.

<http://www.madison.com/wsj/home/local/434406>.

Wisconsin State Journal. “Madison receives payments in lieu of taxes from some nonprofits.” 26

January 2009.

User Fees

Government Finance Officers Association. “Recommended Practice: Setting Government

Charges and Fees.” 1996.

“Measuring the Cost of Government Service.” Government Finance Officers Association. 2002.

<http://www.gfoa.org/downloads/MeasuringtheCostofGovernmentService.pdf>.

Michel, R. Gregory. Cost Analysis and Activity-Based Costing for Government. GovernmentFinancial Officers Association. 2004.

“Second Quarter 2009 Survey of Professional Forecasters”. Philadelphia Federal Reserve Bank.15 May 2009. <http://www.phil.frb.org/research-and-data/real-time-center/survey-of-

professional-forecasters>.

“Setting Government Charges and Fees.” Government Finance Officers Association. 1996.<http://www.gfoa.org/downloads/budgetSettingofGovernmentChargesandFees.pdf>.

Appendix A

21st Century Local Government.” New York State Commission on Local GovernmentEfficiency & Competitiveness. “ April 2008.

Allegheny Institute Report #104-01 “Pittsburgh‟s Finances: A Comparison of Peer Group



Allegheny Institute Report #104 01. Pittsburgh s Finances: A Comparison of Peer Group

Cities.” Allegheny Institute for Public Policy. February 2004.

American Institute of Certified Public Accountants, Tax Division. “Guiding Principles of Good

Tax Policy: A Framework for Evaluating Tax Proposals.” 2001.

“America‟s 30 most visited cities.” ForbesTraveler.com. Accessed at<http://www.forbestraveler.com/best-lists/most-visited-us-cities-slide.html>

Anderson, C.K., Davison, M., and Rasmussen, H.. “Revenue Management: a Real OptionsApproach.” University of Western Ontario. March 24, 2003.

Bae, Suho. “Revenue Growth, Structure, and Burden across State and Local Revenue Sources:

The Impact of State Budgetary Rules.” San Francisco State University. April 2008.

Banzhaf , H. Spencer and Lavery, Nathan. “Can the Land Tax Help Curb Urban Sprawl?” May

2008.

Benjamin, John, Coulson, Edward and Yang, Shiawee. 1993. “Real Estate Transfer Taxes and

Property Values: The Philadelphia Story.” Journal of Real Estate Finance and

Economics. 7: 151-157.

Bland, Robert. A Revenue Guide for Local Government. International City/County Management

Association. 2005.

Bowman, John and Bell, Michael. “Implications of a Split-Rate Real Property Tax: An InitialLook at Three Virginia Local Government Areas ” Lincoln Institute of Land Policy

Appendix A

National Tax Journal. 47: 3. September 1994. p. 559-73.

Cook, Philip and Tauchen, George. “The Effect of Liquor Taxes on Heavy Drinking.” The Bell

Journal of Economics 13: 2 Autumn 1982 p 379-390



Journal of Economics. 13: 2, Autumn 1982, p. 379 390.

Cooperating School Districts. “Testimony from the Cooperating School Districts of Greater St.Louis (CSD) to the Joint Committee on Tax Policy, August 20, 2008.“ August 2008.

CTIA- The Wireless Association. “Wireless Quick Facts.”<http://www.ctia.org/advocacy/research/index.cfm/AID/10323>

Benjamin Dachis, Gilles Duranton, and Matthew Turner. “Sand in the Gears: Evaluating the

Effects of Toronto‟s Land Transfer Tax.”C.D. Howe Institute Commentary. December 2008.

Dadayan, Lucy and Boyd, Donald. “Personal Income Tax Revenue Declined Sharply in the FirstQuarter.” The Nelson A. Rockefeller Institute of Government. 13 May 2009.

De la Bastide, Ken. “Daniels, Kernan Pitch Government Reform.” Kokomo Tribune. 24February 2009

De Turenne, Veronique. “Plastic bag manufacturers sue Manhattan Beach over ban.” Los

Angeles Times. 19 August 2008

Dieticians of Canada. “Taxing Food.” Current Issues. August 2006.

Dwoskin, Elizabeth. “Corzine Presses Towns to Combine Services.” New York Times. 16March 2008.

E W G C il f G “P i Th A l f L l G

Appendix A

Fox, William, Bruce, Donald and Murray, Mathew. “To Tax or Not to Tax? The Case of Electronic Commerce.” Contemporary Economic Policy, January 2003, 25-40.



Gale, William and Rueben, Kim. “Taken for a Ride: Economic Effects of Car Rental ExciseTaxes.” Brookings Institution and the Urban Institute. 16 July 2009.

<http://www.heartland.org/custom/semod_policybot/pdf/19712.pdf >

Gihring, Tom and Nelson, Kris. “Tax Shift – Sequential to a Land-Based Property Tax System

in Salem, Oregon.” November 1999.

Government Finance Officers Association. “GFOA Recommended Practice- Revenue Policy:

Accounts Receivable Controls.” June 2007.

Greenwood, Daphne and Williams, Katie. “Does Growth „Pay For Itself‟ Through IncreasedRevenues or Decreased Costs Per Person? An Analysis of the City of Colorado Springs,

1980-2000.” University of Colorado at Colorado Springs Center for Colorado Policy

Studies. September 2003.

“Guiding Principles of Good Tax Policy: A Framework for Evaluating Tax Proposals.”

American Institute of Certified Public Accountants, 2001, 9-10.

Haslag, Joseph. “How to Replace the Earnings Tax in St. Louis.” Policy Study. Show Me

Institute. 24 January 2007.

Haslag, Joseph. “Lower Tax Rates More Efficient Than Tax Credits.” Show Me Institute. 7 May

2008.

Haughwout, Andrew. Inman, Robert, Craig, Steven, and Luce, Thomas. “Local Revenue Hills:

Appendix A

Hoyt, William and Harden, J. William. “MSA Location and the Impact of State Taxes on

Employment and Population: A Comparison of Border and Interior MSA‟s.” Universityof Kentucky, Institute for Federalism and Intergovernmental Relations. 2005.

http://www.heartland.org/custom/semod_policybot/pdf/19712.pdf

http://www.heartland.org/custom/semod_policybot/pdf/19712.pdf



Inman, Robert, “Local Taxes and the Economic Future of Philadelphia: 2008 Report.” June2008.

Institute of Taxation and Economic Policy. “The ITEP Guide to Fair State and Local Taxes.”February 2005.

Institute of Taxation and Economic Policy. “Tax Principles: Building Blocks of A Sound Tax

System.” August 2008.

Interim Committee to Evaluate the 911 System Report. 29 November 2007.

Iowa Civic Analysis Network. “State Cigarette Taxes: An Issue of Health and Revenue.”University of Iowa. October 2006.

Jacobson. M.F., &. Brownell, K.D. “Small taxes on soft drinks and snack foods to promotehealth.” American Journal of Public Health. 90: 854-857, June 2000.

Johnson, Peter. “A Current Calculation of Uncollected Sales Tax Arising from Internet

Growth.” The Direct Marketing Association. 11 March 2003.

Kleiner, Morris and Krueger, Alan. “The Prevalence and Effects of Occupational Licensing.”2008.

Knight, Brian, Kusko, Andrea and Rubin, Laura. “Problems and Prospects for State and LocalGovernments.” State Tax Notes. 11 August 2003.

Appendix A

Maximus, Inc.. “A Cost Allocation Plan for the City of St. Louis, Missouri: FY2008 Actual.”

2008.



McDonald, John. “Maximization of Non-Residential Property Tax Revenue by a LocalGovernment.” Great Cities Institute Working Paper. February 2007.

Mid-America Regional Council. “Issues & Answers.” 9-1-1 Wireless Legislation. February2009.

“Milwaukee Clears Water Sale to New Berlin.” The Business Journal of Greater Milwaukee. 30July 2008.

Mullin, Clancy. “National Impact Fee Survey: 2008.” Duncan Associates. October 4,2008.

Moody‟s Investors Service “Moody's Assigns Negative Outlook to U.S. Local Government

Sector.” April 2009.

National Conference of State Legislatures. “A Guide to Property Taxes: The Role of Property

Taxes in State and Local Finances.” August 2004.

National Conference of State Legislatures. “Principles of a High-Quality State Revenue System.”June 2007. <http://www.ncsl.org/programs/fiscal/fpphqsrs.htm >

National League of Cities. “Land Use and Development Challenges in America‟s Cities.” 2003.

National League of Cities. “Taxing Problems: Municipalities and America‟s Flawed System of Public Finance.” May 2006.

Appendix A

Orfield, Myron and Luce, Thomas. “Northeast Ohio Metropatterns.” Ameregis. February 2008.

Pachon, Julian E, Iakovou, Eleftherios, Ip, Chi, et al. “A synthesis of tactical fleet planning

http://www.ncsl.org/programs/fiscal/fpphqsrs.htm

http://www.ncsl.org/programs/fiscal/fpphqsrs.htm



, , , , p, , y p g

models for the car rental industry.”IIE Transactions. September 2003.

Penner, Rudolph G. “A Brief History of State and Local Fiscal Policy .” The Urban Institute.

October 1998.

Phares, Donald. “Examining Missouri‟s Tax System: Tax Expenditures- A First Step.” April

2003.

Philadelphia Tax Reform Commission. I: 36. 15 November 2003.

Phillips, Andrew, Cline, Robert and Neubig, Thomas. “Total State and Local Business Taxes:50-State Estimates for Fiscal Year 2007.” Council on State Taxation. 2008.

PMI Group. “The Housing Mortgage Market Review.” April 2009.

Prante, Gerald. “Cigarette Taxes Choke the Poor.” The Hill. 17 July 2007.

Prante, Gerald. “State-Local Tax Burdens Dip As Income Growth Outpaces Tax Growth.” TaxFoundation. August 2008.

Reddick, Christopher. “Assessing Local Government Revenue Forecasting Techniques.”International Journal of Public Administration. 31 December 2004. 597-613.

Regional Plan Association. “Fundamental Property Tax Reform: A Guide for EvaluatingProposals.” Lincoln Land Institute of Land Policy Partnership Project. May 2006.

Appendix A

Skumatz Economic Research Associates, Inc. “Pay as you throw (PAYT) in the US: 2006

Update and Analyses.” 30 December 2006.

Stanley, Rollin. “E = mc2, The Relative City.” 2009.



y, , y

St. Louis Regional Chamber & Growth Association. “Economic Indicators Presentation”February 2009.

St. Louis Regional Chamber & Growth Association. “Greater St. Louis Real Estate, PersonalProperty and Sales Tax Rates.” September 2008.

Shubik, Claire. “Tough Decisions and Limited Options: How Philadelphia and Other Cities are

Balancing Budgets in a Time of Recession.” The Pew Charitable Trusts. 18 May 2009.

Tannenwald, Robert. “Are State and Local Revenue Systems Becoming Obsolete?” NationalLeague of Cities and Brookings Institution. 2004.

Tax Foundation. “Corporate Tax Burden by Metropolitan Statistical Area (MSA), 2005.” October 2007.

Tax Foundation. “Federal Tax Burdens by Major City Area (MSA), Per Household CalendarYear 2004.” March 2007.

Tax Foundation. “Local Wage, Income, and Occupational Privilege Taxes.” July 2008.

Tax Foundation. “Missouri State & Local Tax Burden Compared to U.S. Average 1977 -2008.”August 2008.

Tax Foundation. “Property Taxes on Owner-Occupied Housing, by County Ranked by Taxes as

Appendix A

Collection Practices in State and Local Governments.” Government Finance OfficersAssociation. March 1998.

Vedder, Richard. “Do Taxes Matter? Twenty-Five Years of Empirical Studies Show They Do.”



, y p y

The Buckeye Institute for Public Policy Solutions. 2002.

Walllin, Bruce. “Budgeting for Basics: The Changing Landscape of City Finances.” The

Brookings Institution Metropolitan Policy Program. August 2005.

Warden, Thomas A. and Stunkard, Albert J.. “Prevalence, Consequences, and Treatment of

Obesity.” Handbook of Obesity Treatment. 2004.

Wildasin, David. “Local Government Finances in Kentucky.” Financing State and LocalGovernment. 2001.

Wuensch, Jeff, Kelly, Frank and Hamilton, Thomas. “Land Value Taxation Views, Concepts

and Methods: A Primer.” Lincoln Institute of Land Policy Working Paper. 2000.

TIF and Tax Abatements (Tax Incentives)

Anderson, Patrick, Rosaen, Alex, and Doe, Hillary. “Michigan‟s Business Tax Incentives.”Anderson Economic Group. May 2009.

Bagunu, Dan. “Sustainable Economic Development: A Presentation to the City Council City of

Kansas City, Missouri.” 17 May 2007.

Berkson, Richard, Cornwell, Robert, et al. “Economic Development in Kansas City: A

Framework for Sustainability.” CSG Advisors, Columbia Capital Management, andE i d Pl i S M 2007

Appendix A

Finance Program Management.” 2008.

Council of Development Finance Agencies and International Council of Shopping Centers. Tax

Increment Finance Best Practices Resource Guide. October 2007.



Dye, Richard. “A Comparative Analysis of Tax Increment Financing in Northeastern Illinois. “

Dye, Richard and Palmer, Robert. “The Future of Tax Increment Financing in Illinois.” Institute

of Government and Public Affairs, University of Illinois. 1997.

East West Gateway Council of Governments. “An Assessment of the Effectiveness and Fiscal

Impacts of the Use of Local Development Incentives in the St. Louis Region: Interim

Report.” January 2009.

Lazere, Edward. “Testimony At the Public Roundtable on Bill 15-2, The Tax Increment

Financing Reauthorization Act of 2003 District of Columbia Committee on Finance and

Revenue.” DC Fiscal Policy Institute. 3 February 2003.

Montarti, Eric. “Tax Increment Foolishness.” Policy Brief, Allegheny Institute for Public Policy

10 June 2002.

Stinson Morrison Hecker LLP. “Tax Increment Financing in Missouri Municipalities.”October 2004.

Sullivan, Gary, Johnson, Steve, and Soden, Dennis. “Tax Increment Financing Best Practices

Study.” Institute for Policy and Economic Development, University of Texas at El Paso.1 September 2002.

Sweeney, Mark . “Pro: Incentive- An Effective Tool for Economic Development.” BusinessXpansion Journal 1 January 2006

Appendix A

William Eimicke. “San Diego County‟s Innovation Program: Using Competition and a Whole

Lot More to Improve Services.” PricewaterhouseCoopers Endowment for the Business of Government. January 2000.



Shirley Franklin. “Letter to Council.” City of Atlanta. 10 October 2008.<http://www.atlantaga.gov/client_resources/media/financial/cfo%20letter%20to%20coun

cil.pdf >

Government Finance Officers Association. “GFOA Recommended Practice- Revenue Policy:Accounts Receivable Controls.” June 2007.

Healy, Robert. “City of Cambridge FY 2009 Property Tax Exemptions and Tax Deferral

Information.“ City of Cambridge. November 2008.

Mikesell, John L. Fiscal Administration. Seventh Edition. Thomson Wadsworth. 2007.

Przymusinski, Marcel. “City budget woes spur increase in parking tickets.” Yale Daily News. 25April 2005.

“Tyler Technologies Continues Coast-to-Coast Expansion with ERP Software Contracts.”Business Wire. 12 March 2008.

Tyler Technologies. “Tyler Trends.” 2008.

III. Select Examples of PFM Analyses

1) Demographic Comparison

Examines St. Louis‟ demographic characteristics such as population, median householdincome, and unemployment rate versus nine comparable cities.

Appendix A

6) TIF Project Databases Databases containing financial and operational performance information and statistics for

operational TIF projects in St. Louis, Kansas City, Omaha, and Baltimore.

http://www.yaledailynews.com/authors/view/568

http://www.yaledailynews.com/authors/view/568



7) Short Term Employment And Wage Growth Analysis Analysis of short-term employment and wage growth rates in St. Louis metropolitan area

municipalities.



Appendix B: Fees, Fines, and User Charges In

Fee ID Fee Title Fee Unit Description Date Changed

City Courts



176 Speeding: Not in Excess of 15 mph over the PostedZone

$75.00

177 Speeding: Exceeding Reasonable Speed $75.00

178 Speeding: Impeding the Flow of Traffic - Too SlowSpeed

$50.00

179 Speeding: Exceed Construction Zone Speed Limit $150.00

180 Traffic Signs, Signals, and Radio Markings: Fail toYield Right of Way to Vehicle after Making Stop atStop Sign

$50.00

181 Traffic Signs, Signals, and Radio Markings:Disobeyed Stop Sign - School, Playground, Church,Major and All Others

$75.00

182 Traffic Signs, Signals, and Radio Markings:Disobeyed Electrical Signal

$100.00

183 Traffic Signs, Signals, and Radio Markings:Disobeyed Flashing Red Signal

$100.00

184 Traffic Signs, Signals, and Radio Markings:Disobeyed "Slow-caution" Sign

$75.00

185 Traffic Signs, Signals, and Radio Markings: Failing toObserve Yield Right-of-way Signs

$50.00

186 Traffic Signs, Signals, and Radio Markings:Disobeyed Other Traffic Control Signals and Devices

$50.00

187 Traffic Signs, Signals, and Radio Markings:Disregarding Flashing Amber Signal

$50.00

188 Turning Movements: Failed to Yield Right of Way toPedestrian of Vehicle When Making Right Turn after $75.00


191 Turning Movements: Improper Left Turn/right Turn $50.00



192 Right of Way for Vehicles: Failing to Reduce Speedand Yield at Intersection $75.00

193 Right of Way for Vehicles: Failing to Stop Emergingfrom Alley or Driveway

$50.00

194 Right of Way for Vehicles: Failing to Yield Emergingfrom Alley or Driveway

$50.00

195 Right of Way for Vehicles: Failing to Give Way uponHearing Horn of Overtaking Vehicle

$50.00

196 Right of Way for Vehicles: Failing to Yield toEmergency Vehicles

$100.00

197 Right of Way for Vehicles: Blocking Intersection(Even with Signal)

$50.00

198 Wrong Side of Wrong Way: Wrong Direction on One-way Street

$100.00

199 Wrong Side of Wrong Way: Fail to Keep to Right (LeftSide of Roadway)

$75.00

200 Wrong Side of Wrong Way: Driving Wrong Side of

Divided Street of Highway

$150.00

201 Signal Intention: Failed to Signal Before Turning $50.00

202 Signal Intention: Failed to Signal for Slowing And/orStopping

$50.00

203 Signal Intention: Improper Signal $50.00

204 Passing or Overtaking: Improper Lane Usage-weaving $75.00

205 Passing or Overtaking: Passing or Overtaking

Stopped School Bus

$150.00

206 Violations Against Pedestrians: Failing to Yield Right- $100 00


208 Violations Against Pedestrians: Failing to Yield Right-of-Way to Pedestrian after Making Stop at Stop Sign

$100.00



y g p p g

209 Violations Against Pedestrians: Passing VehicleStopped for Pedestrians

$150.00

210 Pedestrian Violations: Disobeyed Traffic Offers Signal $50.00

211 Pedestrian Violations: Disobeyed Traffic ControlSignals and Devices in Walk Light

$50.00

212 Pedestrian Violations: Crossing Street Other than inCrosswalk in Central Traffic District

$50.00

213 Pedestrian Violations: Soliciting Rides $100.00

214 Pedestrian Violations: Crossing at Place Other Thana Crosswalk

$50.00

215 Bicycle and Motorcycle Violations: No Lights at Night $75.00

216 Bicycle and Motorcycle Violations: Failure to ObeyPolice Officers Directions

$100.00

217 Bicycle and Motorcycle Violations: Failure to ObserveTraffic Signals, Signs, Devices

$50.00

218 License Plate Violations: Obstructed State LicensePlate

$50.00

219 License Plate Violations: Exceeding AuthorizedWeight of License (Weight to be Determined byIssuing Officer)

$75.00 flat Rate, additional $0.10 per pound overlimit

220 License Plate Violations: Operating a Motor VehicleWithout Valid and Proper License Plates. (PlatesIssued to Another, Expired Plates, Not Issued to thatVehicle, One Plate When Two Required, Etc. - with

Proof

$10.00 fixed Fee

221 License Plate Violations: Operating a Motor Vehicle $100.00


222 License Plate Violations: Failed to ProperlyAffix/fasten Plates to a Motor Vehicle/trailer - with

$25.00 fixed Fee



Proof of License

223 License Plate Violations: Failed to ProperlyAffix/fasten Plates to a Motor Vehicle/trailer - withoutProof of License

$100.00

224 No State Vehicle License $100.00

225 Improper Vehicle Registration - Failed to TransferPlates

$100.00

226 License Violations (Operator & Chauffeur, Etc.):

Using an Operator of Chauffeur License or InstructionPermit Issued to Someone Else

$75.00

227 License Violations (Operator & Chauffeur, Etc.):Lending an Operator or Chauffeur License orInstruction Permit to Someone Else

$75.00

228 License Violations (Operator & Chauffeur, Etc.):Displayed Canceled, Revoked, Suspended, Fictitiousor Fraudulently Altered Operator or Chauffeur Licenseor Instructor Permit

$75.00

229 License Violations (Operator & Chauffeur, Etc.):Failed to Heed restrictions on Drivers License

$100.00

230 License Violations (Operator & Chauffeur, Etc.):Failed to Carry or Display Operator or ChauffeurLicense or Instruction Permit

$50.00

231 Committing a Fraud in Any Application for Operator orChauffeur License or Instruction Permit

$200.00

232 No Chauffeur License $100.00

233 Operating a Motorcycle/motor Scooter/motor BikeWithout an Operator of Chauffeur License Indication

$100.00


235 Refusing to Write Name and Address in Presence ofan Officer

$150.00



236 Allowing an Unauthorized Person to Operate One'sMotor Vehicle

$75.00

237 Failure to Surrender Revoked, Suspended, orCanceled Operator or Chauffeur License ofInstruction Permit

$150.00

238 Certificate of Inspection Violations: Failed to Display aValid Certification of Inspection

$75.00

239 Load Violations: Failed to Properly Secure a Vehicle

Load

$100.00

240 Load Violations: Driving with More than ThreePersons over 16 in Front Seat (Overcrowding)

$150.00

241 Load Violations: Driving Overloaded Vehicle $150.00

242 Equipment Violations/Traffic Rules: Operating a MotorVehicle Displaying a Red Light - Not an EmergencyVehicle or School Bus

$75.00

243 Equipment Violations/Traffic Rules: Operating a Motor

Vehicle with Auxiliary Lamps or Spot Lamps WhichWhen Lighted Are Not Substantially White, Yellow, orAmber

$75.00

244 Equipment Violations/Traffic Rules: Operating a MotorVehicle with Headlamps Which are Not SubstantiallyWhite

$75.00

245 Driving with Other Equipment Defects (Specify) $50.00

246 Excessive Emissions $50.00

247 Defective Muffler $50.00 248 No Rear Vision Mirror $50 00


251 Defective Windshield $75.00



252 Unnecessary and Loud Noise by VehiclesOverloaded or in Disrepair $75.00

253 Defective Brakes for Auto or Motorcycle $75.00

254 No Red Flag on Projecting Load - Daytime $75.00

255 Driving over Fire Hose $100.00

256 Driving with Glaring Headlights $75.00

257 No Headlights $100.00

258 One Headlight $75.00

259 No Tail Light $75.00

260 Unilluminated State License Plate $50.00

261 No Stop Light or Signal When Stopping $75.00

262 Excessive Noise (Radio) $75.00

263 Train Blocking Street for More than 5 Minutes $500.00

264 No Child Restraint $25.00 265 No Seat Belt $10.00

266 Commercial Vehicle Violations: Failed to DisplayName/address/gross Weight on Commercial MotorVehicle

$75.00

267 Commercial Vehicle Violations: Commercial Vehicleover 24,000 Lbs. in Downtown Area - Unless Loading,Unloading or Servicing

$100.00

268 Miscellaneous Violations: Careless Driving on ParkingLots Open to Public $75.00




288 Permitted Load to Fall and Remain on Street/roadway $200.00



289 Court Restoration Fee $45.00

Health & Hospitals

143 Rodent, Insect, Pest, Refuge Violation $0.00 per Unabated Violation 7/1/1960

135 Nuisance Sanitation Violations $0.00 per Unabated Violation 7/1/1994

749 Permit Renewal - Food Establishment (g.r $$0.5M +) $150.00 prior year gross receipts $500,000 + 3/15/1996

825 Permit Renewal: High Risk Food Establishment $225.00 per year for 3/4 inspections - proposed feestructure

7/1/2009

131 Temporary Food Establishment Permit $35.00 per Event 7/1/2009

115 Annual Vaccinations with Adoption $5.00 per shot

144 Littering Violation $0.00 per Unabated Violation 7/1/1974

114 Pet Adoption $15.00 per pet

116 Microchip with Adoption $10.00 per chip

134 Swimming Pool Ordinance $0.00 per Swimming Pool 7/1/2002

165 Visible Opacity Re-Certification $100.00 per Application

127 New Food Establishment Permit $35.00 per New Food Establishment 3/15/1996

824 Permit Renewal: Moderate Risk Food Establishment $150.00 per year for 2 inspections - proposed feestructure

7/1/2009

823 Permit Renewal: Low Risk Food Establishment $75.00 per year for 1 inspection - proposed feestructure

7/1/2009

141 Weeds Violation $0.00 per Unabated Violation 7/1/2008

830 Food Establishment Permit: Grocery Stores $0.00 7/1/2009


129 Plan Review - Food Establishment $0.00 per new or remodeled food establishment 7/1/2009



169 Asbestos Abatement Project Inspection $100.00 per site visit - maximum of 3 155 Source Registration Filing Fee (10+ ton Emitters) $100.00 per Application

156 Source Registration Filing Fee (10+ ton Emitters) $50.00 per Emission Unit on Single Application

157 Source Registration Process Fee (<10 ton Emitters) $50.00 per Hour processing Time

158 Source Registration Filing Fee (<10 ton Emitters) $30.00 per Application

159 Source Registration Filing Fee (<10 ton Emitters) $25.00 per Emission Unit on Single Application

160 Source Registration Process Fee (<10 ton Emitters) $25.00 per Hour processing Time

161 Construction Permit Amendment Increase EmissionFee (<10 ton Emitters)

$100.00 per Application

162 Construction Permit Amendment Processing Fee(<10 ton Emitters)

$50.00 per Hour processing Time

164 Visible Opacity Certification $200.00 per Application

173 NOV Inspection $100.00 per Inspection

146 Hazardous Substance Violation $0.00 per Unabated Violation 7/1/1991

170 Stage II Operating Permit Notification $100.00 per Application

149 Construction Permit Filing Fee (10+ ton Emitters) $250.00 per Application

150 Construction Permit Processing Fee (10+ tonEmitters)


151 Construction Permit Filing Fee (<10 ton Emitters) $100.00 per Application

152 Construction Permit Amendment Increase EmissionFee (10+ ton Emitters)

$250.00 per Application

153 Construction Permit Amendment Processing Fee(10+ton Emitters)



128 Permit Renewal - Food Establishment (g.r $0-100,000) $35.00 minimum, up to $100,000 in gross salesduring the prior year

3/15/1996



138 Lodging/Bed and Breakfast Inspection $0.00 per permit 7/1/1992

132 Frozen Dessert Establishment Permit - Outside CityLimits

$350.00 per Establishment 7/1/1978

139 Tattoo Parlor Inspection $0.00 per permit 7/1/1998

142 Fumigation Permit $0.00 per permit 7/1/1960

172 Facility Inspections for less than 10 ton Emitters $50.00 per hour of office preparation, facility siteinspection, report documentation

145 Smoking Violation $0.00 per Violation 7/1/2003

147 Tire Storage Violation $0.00 per Violation 7/1/1989

748 Permit Renewal - Food Establishment (g.r $0.1M-$0.5M)

$100.00 prior year gross receipts between $100,000and $500,000

3/15/1996

167 Freedom of Information Act Requests $25.00 per Request, additional $0.25 per page

133 Frozen Dessert Establishment Permit - Inside CityLimits

$750.00 per establishment 7/1/1978

163 Penalty Fee per Application

148 Abrasive Blasting Notification $50.00 per Site

109 Health Provider Reimbursement fee may vary 6/21/2005

110 Nursing School Transcripts $13.50 per transcript

111 Medical Records for Attorneys $20.02 per record 2/17/2009

112 Immunization Records $13.50 per record 2/17/2009

113 Per Page Charge for Copy of Record $0.47 per page 2/17/2009

117 Rabies Vaccination $10 00 per shot


121 Boarding - Stray Animal $10.00 per day, After 3 days



122 Small Trap Rental $25.00 per Trap, For 2 weeks 10/31/2008 123 Medium Trap Rental $35.00 per Trap, For 2 weeks 11/1/2008

124 Large Trap Rental $50.00 per Trap, For 2 weeks 11/2/2008

125 City License - Unaltered Pet $50.00 per Tag 6/21/2001

126 Rabies Observation $50.00 per Quarantine

136 Farmers/Produce Market $0.00 per permit, building charges $10 filing feeand $5 inspection fee

7/1/1963

137 Bath house/Masseuse Inspection $0.00 per permit, BPS charges $10 filing fee 7/1/1975

140 Noise Ordinance $0.00 per violation, maximum $500 per incidentplus court costs

166 Late Payment Filing Fee per Late Submission - Fee varies

174 NOV Processing per NOV issue

175 Stage II NOV Inspection on each hose, line, pump, equipage anddevice that is found to be in substandardcondition and emitting pollutants

829 HACCP Plan Review $0.00

Judicial Office - Circuit Clerk

528 Felony Case Costs $279.50

529 Criminal Court Other Costs: Witness Per Diem: InState (plus mileage)

$25.00 per day

530 Misdemeanor Case Cost $102.50

531 Criminal Court Other Costs: Witness Per Diem: InState - Mileage

$0.48 per mile - state rate in 2009


534 Conservation/Watercraft Case Cost $77.50



535 Criminal Court Other Costs: Witness Per Diem: Out ofState - Mileage $0.10 per mile - state rate in 2009

536 Criminal Court Costs: Municipal Case $30.50

537 Criminal Court Costs: Bad Check Fee reasonable service charge

538 Criminal Court Costs: Basic Civil Legal Service Fundsurcharge for Appeals to Supreme Court and Court ofAppeals

$20.00

539 Criminal Court Other Costs: Board Fill: Indigent

Defendant

$22.00 per person per day

540 Criminal Court Other Costs: Board Bill - Taxes asCost to the Defendant - not paid by state

set by court

541 Criminal Court Other Costs: Board Bill - Taxes asCost to the Defendant - reimb by state

$22.00 per person per day

542 Criminal Court Other Costs: Clerk Fee - Applicationfor a Trial de Novo

$6.00 county portion of the total Clerk fee of $30,$24 to MO Dept of Rev

543 Criminal Court Other Costs: Clerk Fee - Notice ofAppeal

$50.00

544 Criminal Court Other Costs: Copy Fees - JudicialRecords

reasonable fee per local court rule

545 County Law Enforcement Restitution Fund $300.00 up to max of $300

546 Criminal Court Other Costs: St Louis City MunicipalOrdinance Violations

$20.00 up to max of $20

547 Criminal Court Other Costs: Court Operationsurcharge

$10.00 (not issued in STL)

548 Courthouse Restoration Fee: St Louis City MunicipalOrdinance Violation $5.00 max


551 Crime Victims' Compensation Fund Judgment:Alcohol - Felony C & D

$46.00



552 Crime Victims' Compensation Fund Judgment:Alcohol - Felon A & B

$68.00

553 Crime Victims' Compensation Fund Judgment:Other - Misdemeanor

$10.00

554 Crime Victims' Compensation Fund Judgment:Other - Felony C & D

$46.00

555 Crime Victims' Compensation Fund Judgment:Other - Felony A & B

$68.00

556 Criminal Court Other Costs: Domestic ViolenceShelter surcharge

$2.00

557 Criminal Court Other Costs: DNA Profiling AnalysisFund - Chapter 195 Serious Felony

$30.00

558 Criminal Court Other Costs: DNA Testing - PostConviction

reasonable cost

559 Criminal Court Other Costs: Drug CommissionerSurcharge

$30.00

560 Criminal Court Other Costs: Drug Testing by State Lab $150.00

561 Criminal Court Other Costs: Drug Testing by a PrivateLab

actual costs

562 Criminal Court Other Costs: Extradition Costs amount approved by the court

563 Criminal Court Other Costs: Inmate Security Fundsurcharge

$2.00

564 Criminal Court Other Costs: Interpreter/Translator Fee reasonable fee and expenses approved bythe court

565 Criminal Court Other Costs: Jury Fees - Taxed toDefendant

actual costs taxed by the Judge


568 Criminal Court Other Costs: Non-Negotiable PaymentFee

$4.00 amount approved by the court



569 Criminal Court Other Costs: Overpayment max

570 Criminal Court Other Costs: Postage reasonable fee for local court rule

571 Criminal Court Other Costs: Public Records CopyFee - Administrative Records

$0.10 per page plus clerk time

572 Criminal Court Other Costs: Sheriffs'' Fees: Contemptor Attachment proceeding

$75.00

573 Criminal Court Other Costs: Sheriffs'' Fees: Traffic &Conservation/Watercraft

$10.00

574 Criminal Court Other Costs: Sheriffs'' Fees: Infractions $6.00

575 Criminal Court Other Costs: Sheriffs' Service Mileage mileage at IRS rate

576 Criminal Court Other Costs: Law Enforcement ArrestCosts: Highway Patrol

amount approved by court

577 Criminal Court Other Costs: Law Enforcement ArrestCosts: Local (County)


578 Criminal Court Other Costs: Law Enforcement Arrest

Costs: Municipal


579 Criminal Court Other Costs: Storage Costs: CAFAProceeding

set by the court

580 Criminal Court Other Costs: Time Payment Fee $25.00

581 Criminal Court Other Costs: Public Records CopyFee - Administrative Records Clerk time

$0.20 per min in addition to the per page recordscharge

582 Circuit Civil Court Costs $83.00

583 Associate Civil Court Cost $33.00

584 Small Claims Civil Court Cost $20 00


588 Civil Court Costs: Clerk Fee - Application for Trail deNovo

$9.00 Chapter 517 and Small Claims, countyportion of the fee, additional $36 to MO



Dept of Rev589 Civil Court Costs: Clerk Fee - Notice of Appeal $50.00

590 Civil Court Costs: Copy Fees - Judicial Records reasonable fees per local court rule

591 Civil Court Costs: Court Appointed Special AdvocateFund surcharge - Domestic relations

$2.00

592 Civil Court Costs: Courthouse Restoration Fee $45.00

593 Civil Court Costs: Crime Victims' Compensation Fund $7.50

594 Civil Court Costs: Domestic Violence Sheltersurcharge

$2.00

595 Civil Court Costs: Family Court surcharge $30.00

596 Civil Court Costs: Interpreter/Translator fees reasonable fees per local court rule

597 Civil Court Costs: Juvenile Delinquency $10.00

598 Civil Court Costs: Misdemeanor $25.00

599 Civil Court Costs: Felony $50.00

600 Civil Court Costs: Law Library surcharge $15.00 max, if adopted by courthouse

601 Civil Court Costs: Mechanics Lien Fil ing $1.00 county portion of total fee, additional $4 toMO Dept of Rev

602 Civil Court Costs: Naturalization Certificate $0.30 county portion of total fee, additional $1.20to MO Dept of Rev

603 Civil Court Costs: Non-Negotiable Payment Fee $4.00

604 Civil Court Costs: Overpayment $5.00 max

605 Civil Court Costs: Parent Education Class Cost varies


608 Civil Court Costs: Public Records Copy -Administrative Records

$0.10 per page plus the clerk fee



609 Civil Court Costs: Public Records Copy -Administrative Records (Clerk Fee)

$0.20 per min for clerk plus per page fee

610 Civil Court Costs: Settlement Costs actual costs

611 Civil Court Costs: Sheriffs' Fees - Summons $20.00 each

612 Civil Court Costs: Sheriffs' Fees - Subpoena $10.00 each

613 Civil Court Costs: Sheriffs' Fees - Contempt ofAttachment Proceeding

$75.00 each

614 Civil Court Costs: Sheriffs' Deputy SalarySupplementation

$10.00 for each civil summons, writ, subpoena orother order of court

615 Civil Court Costs: Sheriffs' Service Mileage mileage at IRS rate

616 Civil Court Costs: Time Payment Fee $25.00

617 Civil Court Costs: Vital Records $15.00 each, birth, marriage, divorce, fetal deathrecord, legitimation, adoption, court order orrecording

618 Civil Court Costs: Vital Records - 1st Death Record $13.00 first

619 Civil Court Costs: Vital Records - each additionalrecord

$10.00 for each additional record

620 Civil Court Costs: Witness Per Diem - In State $25.00 per day plus mileage

621 Civil Court Costs: Witness Per Diem - In State Mileage $0.48 per mile

622 Civil Court Costs: Witness Per Diem - Out of State $15.00 per day plus mileage

623 Civil Court Costs: Witness Per Diem - Out of StateMileage

$0.10 per mile

691 Criminal Court: Felony Case Cost - County portion ofCl k F

$9.00 county clerk fee portion of total fee($279 50)


694 Criminal Court: Felony Case Cost - Sherriff's Fee $75.00 Sherriff fee portion of total fee ($279.50)

695 Criminal Court: Misdemeanor Case Cost - County $3.00 county clerk fee portion of total fee ($102.5)



portion of Clerk Fee

696 Criminal Court: Misdemeanor Case Cost - County Fee $25.00 county fee portion of total fee ($102.50)

697 Criminal Court: Misdemeanor Case Cost - PATFsurcharge

$0.50 county portion of total fee ($102.50)

698 Criminal Court: Misdemeanor Case Cost - Sherriff'sFee

$10.00 Sherriff fee portion of total fee ($102.50)

699 Criminal Court: Traffic Case Cost - County portion ofClerk Fee

$3.00 county clerk fee portion of total fee ($54.50)

700 Criminal Court: Traffic Case Cost - County Fee $10.00 county fee portion of total fee ($54.50)

701 Criminal Court: Traffic Case Cost - PATF surcharge $0.50 county portion of total fee ($54.50)

702 Criminal Court: Conservation/Watercraft Case Cost -County portion of Clerk Fee


703 Criminal Court: Conservation/Watercraft Case Cost -County Fee

$10.00 county fee portion of total fee ($77.50)

704 Criminal Court: Conservation/Watercraft Case Cost -

PATF surcharge

$0.50 county portion of total fee ($77.50)

705 Criminal Court: Municipal Case Cost - County portionof Clerk Fee


706 Civil Court: Circuit Civil Costs - County portion ofClerk Fee

$9.00 county clerk fee portion of total fee ($83)

707 Civil Court: Associate Civil Costs - County portion ofClerk Fee


708 Civil Court: Small Claims Costs - County portion of

Clerk Fee


J di i l Offi Sh iff


711 Sheriff: Subpoena $30.00

712 Sheriff: Subpoena - out of MO $32.50 includes notary fee



713 Sheriff: Garnishments $30.00

714 Sheriff: Executions $30.00

715 Sheriff: Evictions $30.00

716 Sheriff: Writs $30.00

717 Sheriff: Deeds $30.00

License Collector624 Licenses: Cigarette Wholesalers Stamp Tax $0.07 per stamp

625 Licenses: Cigarette Wholesalers Stamp Tax $0.09 per stamp

626 Licenses: Entertainment Amusements 5% of gross receipts on admissions charges

627 Licenses: Sporting Events - Basketball 5% of gross receipts on admissionscharges - Cardinals are Exempt

628 Licenses: Sporting Events - Boxing 5% of gross receipts on admissions charges

629 Licenses: Sporting Events - Baseball 5% of gross receipts on admissions charges

630 Licenses: Sporting Events - Football 5% of gross receipts on admissions charges

631 Licenses: Sporting Events - Hockey 5% of gross receipts on admissions charges

632 Licenses: Sporting Events - Soccer 5% of gross receipts on admissions charges

633 Licenses: Sporting Events - Wrestling 5% of gross receipts on admissions charges

634 Hotel/Motel - Convention and Tourism 3.75% sales tax per cost of room

635 Hotel/Motel - Sales Tax 3.5% per cost of room

Li R f i


639 Licenses: Liquor - 5% Drink (Malt) $87.50

640 Licenses: Liquor - full Package (Intox) $250.00



641 Licenses: Liquor - Full Drink (Intox) $375.00

642 Licenses: Liquor - Full Drink (Sunday Intox) $375.00

643 Licenses: Liquor - COL Setup $180.00

644 Licenses: Liquor - 22% Package (Wine) $150.00

645 Licenses: Liquor - 22% Drink (Wine) $300.00

646 Licenses: Liquor - 3.2% Wholesaler (Non-Intox) $75.00

647 Licenses: Liquor - 5% Wholesaler (Malt) $125.00

648 Licenses: Liquor - Full Wholesaler (Intox) $625.00

649 Licenses: Liquor - 22% Wholesaler (Wine) $250.00

650 Licenses: Liquor - 3.2% Manufacturer (Non-Intox) $375.00

651 Licenses: Liquor - 5% Manufacturer (Malt) $500.00

652 Licenses: Liquor - Full Manufacture (Intox) $500.00

653 Licenses: Liquor - 22% Manufacture (Intox) $250.00

654 Licenses: Liquor - Microbrewery $250.00

655 Licenses: Liquor - Extension pro-rated 1/12th of the annual fee

656 Licenses: Liquor - Place of Amusement $200.00

657 Licenses: Tow Trucks - Wreaker range from $200-$37,500 graduated withthe number of employees

658 Licenses: Home Business $50.00 per year

659 Licenses: Auto Dealers $2.50 each, min $5


662 Licenses: Coin Operated Service Device - 5¢-9¢ $3.00 annually

663 Licenses: Coin Operated Service Device - 1¢-4¢ $1.00 annually



664 Licenses: Coin Operated Vending Device - 10¢+ $10.00 annually

665 Licenses: Coin Operated Vending Device - 5¢-9¢ $3.00 annually

666 Licenses: Coin Operated Vending Device - 1¢-4¢ $1.00 annually

667 Licenses: Rooming Houses & Hotels $1.50 per room per year

668 Licenses: Public Parking Garages and Lots 5% of gross receipts

669 Licenses: Trailer Park $25.00 for the first 5 spaces, plus $5 per space in

excess of 5 spaces

670 Licenses: Graduated Business License range from $200-$37,500 graduated withthe number of employees

671 Licenses: Festival Vendor $75.00

672 Licenses: Sidewalk Vendor $200.00 per calendar year

673 Licenses: Vehicle Vendor $200.00 per calendar year

674 Licenses: Vendor identification $20.00 per calendar year

675 Licenses: Auctioneer Crier $10.00 12 months

676 Licenses: Auctioneer - One Month $10.00 plus $2 registration fee

677 Licenses: Auctioneer - Three Months $20.00 plus $2 registration fee

678 Licenses: Itinerant Centor $25.00 per day

679 Licenses: Auctioneer - Six Months $30.00 plus $2 registration fee

680 Licenses: Auctioneer - Twelve Months $50.00 plus $2 registration fee

681 Licenses: Liquor - 5% Drink Picnic (Malt) $25.00 limited time license


685 Licenses: Billiards/Pool Room yearly basis

686 Licenses: Special District Tax - Cherokee 50% of GBL fee imposed



687 Licenses: Special District Tax - Cherokee/Lemp 50% of GBL fee imposed

688 Licenses: Arcade

689 Licenses: Manufacturers - Ad Valoren Tax rate set each year

690 Licenses: Special District Tax - East Loop - ParkviewGardens

50% of GBL fee imposed

862 Licenses: Graduated Business License (0-2Employees)

$200.00 annual license, from June 1 through May 31 6/1/2008






$1,500.00 annual license, from June 1 through May 31 6/1/2008
















874 Licenses: Graduated Business License (301 400 $30 000 00 annual license from June 1 through May 31 6/1/2008







876 Licenses: Graduated Business License (501+Employees)


Parks, Rec & Forestry - Forestry

1 Grass/Weed Cutting Vacant Lot Ordinance Cost $0.01 per square foot 1/1/2006 2 Handwork/Trim - Grass Cutting $108.00 flat hourly rate for cutting grass on a vacant

or occupied building1/1/2000

3 Handwork/Trim - Debris Removal $140.00 flat hourly rate for grass/weeds and debrisremoval

7/1/1986

4 Light Debris Removal $200.00 flat hourly rate for removing debris from aproperty with the use of a small or mediumsize loader

1/1/2004

5 Heavy Debris Removal $225.00 flat hourly rate for removing debris from aproperty with the use of a large size loader 1/1/2004

6 Spraying $0.01 per square foot 7/1/1986

7 Memorial Tree Plantings $125.00 per tree 1/1/2005

8 Interest 9% interest applied too delinquent accounts 7/1/1986

9 Beechwood Intake $3.27 per cubic yard of beechwood intake 1/1/2000

10 Brush intake from private citizens $10.00 minimum, up to $40 per truck/trailer chargefor brush & logs

1/1/2000

11 Private Tree Removals - Tree Removal $4 89 per circumference inch cost to remove tree


38 Forest Park: Special Events Jewel Box - Admissions $1.00 person rate 7/1/2006

16 Forest Park: Picnic Pavilion Electric - Weekdays $45.00 weekday rate 7/1/2006



17 Forest Park: Picnic Pavilion Electric - Weekends $65.00 weekend rate 7/1/2006

18 Forest Park: Picnic Pavilion No Electric - Weekdays $35.00 weekday 7/1/2006

19 Forest Park: Picnic Pavilion No Electric - Weekends $60.00 weekend 7/1/2006

20 Forest Park: Picnic Ground - Weekday $20.00 weekday rate 7/1/2006

21 Forest Park: Picnic Ground - Weekday $40.00 weekend rate 7/1/2006

22 Forest Park: Truck/Bus Permit - Weekday $5.00 weekday rate 7/1/2006

23 Forest Park: Truck/Bus Permit - Weekend $25.00 weekend rate 7/1/2006

73 All City Parks: Picnics - Picnic Pavilion ElectricWeekdays

$45.00 weekday rate 7/1/2006

74 All City Parks: Picnics - Picnic Pavilion ElectricWeekends

$65.00 weekend rate 7/1/2006

75 All City Parks: Picnics - Picnic Pavilion No ElectricWeekdays

$35.00 weekday rate 7/1/2006

76 All City Parks: Picnics - Picnic Pavilion No ElectricWeekends $60.00 weekend rate 7/1/2006

77 All City Parks: Picnics - Picnic Grounds Weekdays $20.00 weekday rate 7/1/2006

78 All City Parks: Picnics - Picnic Grounds Weekends $45.00 weekend rate 7/1/2006

79 All City Parks: Picnics - Willmore Park Council RingWeekdays

$25.00 weekday rate 7/1/2006

80 All City Parks: Picnics - Willmore Park Council RingWeekends

$25.00 weekend rate 7/1/2006

81 All City Parks: Picnics - Carondelet Park Weekdays $45.00 weekday rate 7/1/2006


25 Forest Park: Park Vending $1,000.00 annual 7/1/2006

26 Forest Park: Special Events World's Fair Pavilion -Friday

$900.00 daily rate 7/1/2006



Friday

27 Forest Park: Special Events World's Fair Pavilion -Saturday 9-3

$900.00 daily rate 7/1/2006

28 Forest Park: Special Events World's Fair Pavilion -Saturday 4-12

$1,400.00 daily rate 7/1/2006

29 Forest Park: Special Events World's Fair Pavilion -Sunday

$900.00 daily rate 7/1/2006

30 Forest Park: Special Events World's Fair Pavilion -

Monday to Thursday

$700.00 daily rate 7/1/2006

31 Forest Park: Special Events World's Fair Pavilion -Catering

8% 7/1/2006

13 Forest Park: Athletic Field Rental - Aviation FieldLighted

$25.00 flat hourly rate 7/1/2006

14 Forest Park: Athletic Field Rental - Aviation FieldUnlighted


15 Forest Park: Athletic Field Rental - Central Field

Lighted


24 Forest Park: Hayrides $100.00 wagon seats 20 people 7/1/2006

32 Forest Park: Special Events Jewel Box - Weekday5PM to 8:30PM

$500.00 1.5 hour time slot rate, $900 for eventsplanned 12 months + in advance

7/1/2006

33 Forest Park: Special Events Jewel Box - Saturday12PM to 5:30PM


7/1/2006

34 Forest Park: Special Events Jewel Box - Sunday 3PMto 8:30PM


7/1/2006

35 Forest Park: Special Events Jewel Box - Friday andSaturday 6PM to 12AM

$2,500.00 evening Rate 7/1/2006


37 Forest Park: Special Events Jewel Box - WeekdayLuncheon

$500.00 event rate 7/1/2006

39 Forest Park: Special Events Jewel Box Catering 8%



39 Forest Park: Special Events Jewel Box - Catering 8%

40 Forest Park: Special Events Grand Basin/Art Hill -Wedding

$400.00 4 Hour Time Slot 7/1/2006

41 Forest Park: Special Events Grand Basin/Art Hill -Private/Party Reception

$700.00 event rate 7/1/2006

42 Forest Park: Special Events Grand Basin/Art Hill -Mon-Thurs Open to the Public

$500.00 day rate 7/1/2006

43 Forest Park: Special Events Grand Basin/Art Hill -

Friday Open to the Public

$3,600.00 day rate 7/1/2006

44 Forest Park: Special Events Grand Basin/Art Hill - Satand Sun Open to the Public

$5,000.00 day rate 7/1/2006

45 Forest Park: Special Events Pagoda Circle - Wedding $400.00 4 Hour Time Slot 7/1/2006

46 Forest Park: Special Events Pagoda Circle (<500people)

$500.00 day rate 7/1/2006

47 Forest Park: Special Events Pagoda Circle (500+people)

$1,000.00 day rate 7/1/2006

48 Forest Park: Special Events Upper Muny Parking Lot(<500 people)

$300.00 day rate 7/1/2006

49 Forest Park: Special Events Upper Muny Parking Lot(500+ people)

$700.00 day rate 7/1/2006

50 Forest Park: Special Events Upper Muny Parking LotPark and Shuttle

$2.00 per car parked, maximum daily rate of $1200 7/1/2006

51 Forest Park: Special Events Lower Muny Parking Lotevent <500 people

$300.00 day rate 7/1/2006

53 Forest Park: Special Events Lower Muny Parking LotPark and Shuttle

$2.00 per car parked, maximum daily rate of $800 7/1/2006


55 Forest Park: Special Events Cabanne House InsidePrivate Party


56 Forest Park: Special Events Cabanne House Outside $500 00 event rate 7/1/2006



56 Forest Park: Special Events Cabanne House OutsideTented Party

$500.00 event rate 7/1/2006

57 Forest Park: Special Events Cricket Field - 500+people

$700.00 day rate 7/1/2006

58 Forest Park: Special Events Langenberg Field $500.00 day rate 7/1/2006

59 Forest Park: Special Events Lindell Field $1,000.00 day rate 7/1/2006

60 Forest Park: Special Events Ticketed Event $0.05 per square foot 7/1/2006

61 Forest Park: Equipment - Red Bandwagon (16x8) $230.00 day rate 7/1/2006

62 Forest Park: Equipment - Red Bandwagon (16x16) $375.00 day rate 7/1/2006

63 Forest Park: Equipment - New Bandwagon No FrontSection

$625.00 2 Hour Time Slot, $75 each Additional Hour 7/1/2006

64 Forest Park: Equipment - New Bandwagon With FrontSection

$800.00 2 Hour Time Slot, $95 each Additional Hour 7/1/2006

65 Forest Park: Equipment - Speaker Stand $150.00 day rate 7/1/2006

66 Forest Park: Equipment - Portable Bleachers $300.00 day rate 7/1/2006 67 Forest Park: Equipment - Tent (30x30) $300.00 day rate 7/1/2006

68 Forest Park: Equipment - Picnic Tables $11.50 per table 7/1/2006

69 Forest Park: Equipment - Trash Containers $7.50 per container 7/1/2006

70 Forest Park: Equipment - Barricades $5.00 per barricade 7/1/2006

83 All City Parks: Parks Vending $1,000.00 per year 7/1/2006

84 All City Parks: Special Events - Kiener Plaza/May

Amphitheater

$300.00 per day 7/1/2006


88 All City Parks: Special Events - Carondelet ParkMusic Stand

$500.00 per day 7/1/2006

89 All City Parks: Special Events - Lafayette Park $500 00 per day 7/1/2006



89 All City Parks: Special Events - Lafayette ParkBoathouse

$500.00 per day 7/1/2006

90 All City Parks: Special Events - Lafayette Park Gazebo $300.00 per day 7/1/2006

91 All City Parks: Special Events - All Other Parks $200.00 per day 7/1/2006

92 All City Parks: Special Events - Ticketed Events $0.05 per square foot 7/1/2006

93 All City Parks: Equipment - Red Bandwagon (16x8) $230.00 per day 7/1/2006

94 All City Parks: Equipment - Red Bandwagon (16x16) $375.00 per day 7/1/2006

95 All City Parks: Equipment - New Bandwagon (w/o Fr.Sec)

$625.00 2 Hour Event 7/1/2006

96 All City Parks: Equipment - New Bandwagon (w/ Fr.Sec)

$800.00 2 Hour Event 7/1/2006

97 All City Parks: Equipment - Speaker Stand $150.00 per day 7/1/2006

98 All City Parks: Equipment - Portable Bleachers $300.00 per day 7/1/2006

99 All City Parks: Equipment - Tent (30x30) $300.00 per day 7/1/2006

100 All City Parks: Equipment - Picnic Tables $11.50 each 7/1/2006

101 All City Parks: Equipment - Trash Containers $7.50 each 7/1/2006

102 All City Parks: Equipment - Barricades $5.00 each 7/1/2006

Parks, Rec & Forestry - Recreation

103 Boathouse Rental $40,000.00 plus 4.5% of gross revenues up to $1 M and5.5% of gross revenues $1 M +

7/1/2008

104 Probstein Golf Course ######### minimum, escalating rent; 2008-20012 3/5/2009


105 Triple A Golf Course $10,000.00 or 3% of gross revenues, contract hasescalating rent from minimum rent in 2011

of $50 0 to $200 000 in 2027 andpercentage rents of 10 20% for golf 8 13%



of $50,0 to $200,000 in 2027 andpercentage rents of 10-20% for golf, 8-13%for tennis, and 8-12% for food andbeverages

106 Steinberg Rink and Aviation Field of gross profit 10/1/2007

504 Building Rental: Gym or Auditorium $50.00 per hour 6/28/2005

505 Swimming Pool Rental $50.00 per hour 6/28/2005

506 Rental: Tables $5.00 each 6/28/2005

507 Rental: Chairs $0.50 each 6/28/2005

Parks, Rec & Forestry - Soulard Market

107 Soulard Market $1,254.00 per stand minimum, up to $1,280

290 Daily Rental Fee: Jan-March, Wed-Fri $10.00

291 Daily Rental Fee: Jan-March, Saturday $20.00

292 Daily Rental Fee: Apr-Dec, Wed-Thurs $10.00

293 Daily Rental Fee: Apr-Dec, Friday $20.00

294 Daily Rental Fee: Apr-Dec, Saturday $30.00

295 Current Lease Fees: Rental Terms, Full Stand $316.00 per quarter

296 Current Lease Fees: Rental Terms, Full Stand (LatePayment)

$60.00 per stand per month

297 Current Lease Fees: Grand Hall Shops $257.50 per month

298 Current Lease Fees: Grand Hall Shops (LatePayment)

$60.00 per stand per month




421 Electrical Permit: Carnivals $50.00 per location, inspection of wiring andelectrical equipment

9/8/2000

422 Electrical Permit: Reinspection $25 00 for the first reinspection 9/8/2000



422 Electrical Permit: Reinspection $25.00 for the first reinspection 9/8/2000

423 Electrical Permit: Reinspection for Certification $100.00 for the first reinspection 9/8/2000

424 Electrical Permit: Residential - Repair/Modify $40.00 for the first unit, plus $30 for each additionalunit

9/8/2000

425 Electrical Permit: Residential - Repair/Modify withService

$50.00 for the first unit, plus $40 for each additionalunit

9/8/2000

426 Electrical Permit: Residential - Service Only $40.00 for the first unit, plus $30 for each additionalunit

9/8/2000

427 Electrical Permit: Residential - New Construction(including rehab)

$80.00 for the first unit, plus $60 for each additionalunit

9/8/2000

377 Administrative Fee - 1st Letter $25.00 per code violation 8/2/2005

384 Administrative Fee - 2nd Letter $50.00 per code violation 8/2/2005

367 Plumbing Permit: Application Fee $25.00 per application 2/22/2005

428 Plumbing Permit: Tap Water Connection or Extension $20.00 each 2/22/2005

429 Plumbing Permit: Sewer Extension $20.00 each, connection or repair 2/22/2005 430 Plumbing Permit: Irrigation System $20.00 each (does not include backflow devices) 2/22/2005

431 Plumbing Permit: Fixtures $5.00 each 2/22/2005

432 Plumbing Permit: Tests (Backflow and Check Valve) $35.00 test of a reduced pressure backflow deviceor double gate/double check valve

2/22/2005

433 Plumbing Permit: Late Fee for Backflow Tests $25.00 for backflow tests not performed within 30days of anniversary date

2/22/2005

434 Plumbing Permit: Rough Inspection $20.00 each 2/22/2005

435 Plumbing Permit: Finish Inspection $20 00 each 2/22/2005


363 Building Permit .5% of Construction Value of Project + $25filing fee

8/2/2005

364 Building Permit .2% of Construction Value of Project 8/2/2005





831 UE Ameron: Re-hook Electricity Connection $25.00 residential and commercial electricityrehook up inspection

7/7/1999

366 Occupancy Permit: Application $80.00 8/2/2005

438 Occupancy Permit: Commercial (< 3,500 sq ft) $80.00 for first unit 8/2/2005

439 Occupancy Permit: Commercial (> 3,500 sq ft) $160.00 for first unit 8/2/2005

440 Occupancy Permit: Residential $80.00 plus $20 each additional units in the sameunit

8/2/2005

379 Building Board-Up $29.00 per opening secured, plus 10%administrative fee

8/2/2005

373 Stationary Engineer License $15.00 renewal fee - $15 6/26/2003

380 Building Demolition cost of demolition contract + 10%administrative fee

8/2/2005

370 Demolition Permit $15.00 per 1000 cubic ft 8/2/2005 369 Mechanical Permit: Application $25.00

394 Mechanical Permit: Amusement Rides $10.00 per ride 8/2/2000

395 Mechanical Permit: Auto Lifts $80.00 per unit 8/2/2000

396 Mechanical Permit: Boilers-High Pressure (<1 MBTU/hr)

$60.00 per boiler 8/2/2000

397 Mechanical Permit: Boilers-High Pressure (>1 MBTU/hr)

$80.00 per boiler 8/2/2000

398 Mechanical Permit: Boilers-Low Pressure (<1 M $50 00 per boiler 8/2/2000


401 Mechanical Permit: Air Conditioning/Refrigeration(<14 tons)

$60.00 per unit 8/2/2000

402 Mechanical Permit: Air Conditioning/Refrigeration $85.00 per unit, plus $1 per ton 8/2/2000



402 Mechanical Permit: Air Conditioning/Refrigeration(14+ tons)

$85.00 per unit, plus $1 per ton 8/2/2000

403 Mechanical Permit: Cooling Towers $180.00 per tower 8/2/2000

404 Mechanical Permit: Ventilation System (500-2,000cfm)

$80.00 per system 8/2/2000

405 Mechanical Permit: Ventilation System (2,000-15,000cfm)

$140.00 per system 8/2/2000

406 Mechanical Permit: Ventilation System (+15,000 cfm) $180.00 per system 8/2/2000

407 Mechanical Permit: Exhaust Hoods (<5,000 cfm) $80.00 per system 8/2/2000

408 Mechanical Permit: Exhaust Hoods (>5,000 cfm) $140.00 per system 8/2/2000

409 Mechanical Permit: Fire Smoke Dampers $40.00 per unit 8/2/2000

410 Mechanical Permit: Process Piping $20.00 each 8/2/2000

411 Mechanical Permit: Special Inspection $40.00 each 8/2/2000

412 Mechanical Permit: Reinspection $25.00 each 8/2/2000

374 Electrical License Exam $100.00 renewal fee - $100 9/8/2000

362 Conditional Use Hearing $0.00 4/1/1992

375 Mechanical Licenses $8.00 examination fee, renewal fee - $8 6/26/2003

372 Plumbing Licenses: Plumbing - Application Fee $50.00 2/22/2005

385 Plumbing Licenses: Plumbing - Journeyman $50.00 for three years, plus application fee 2/22/2005

386 Plumbing Licenses: Plumbing - Master Drain layer orPlumber

$300.00 for three years, plus application fee 2/22/2005

387 Plumbing Licenses: Plumbing - Master Drain $600 00 for three years plus application fee 2/22/2005


390 Plumbing Licenses: Sprinkler Fitters - SprinklerContractor


391 Plumbing Licenses: Sprinkler Fitters - Sprinkler Fitter $50.00 for three years, plus application fee 2/22/2005



g p p $ y , p pp

392 Plumbing Licenses: Backflow Tester License -Contractor


393 Plumbing Licenses: Backflow Tester License -Journeyman Pipefitter


361 Board of Adjustment Appeal $145.00 4/1/1992

378 Admin Fee Appeal $20.00 8/2/2005

360 Building Appeal $150.00 8/2/2005

376 Demolition Contractor License: Application $30.00 per application 8/2/2005

382 Demolition Contractor License: Class I $200.00 plus application fee 8/2/2005

383 Demolition Contractor License: Class II $90.00 plus application fee 8/2/2005

381 Vacant Building Registration $200.00 every 6 months until all code violationsabated

8/2/2005

Public Safety - CEMA

359 EMPG varied, 50% of budget, per quarter 10/1/2008

Public Safety - Corrections

456 Corrections: Medical Fees - Doctor/Dentist Call $5.00 8/31/2005

458 Corrections: Medical Fees - Prescription/X-Ray $3.00 8/31/2005

459 Corrections: Medical Fees - Nurse Call $2.00 8/31/2005

457 Corrections: Medical Intake Fee


443 Burglar Alarm Registration Permit: Commercial $50.00 per permit per year 5/6/2004

441 Burglar Alarm Fines $25.00 minimum, up to $100 5/6/2004

444 F d l P i H i (USMS) $73 00 i t d 4/1/2003



444 Federal Prisoner Housing (USMS) $73.00 per inmate per day 4/1/2003

445 Federal Prisoner Housing (USPS) $73.00 per inmate per day 1/30/2008

Public Safety - EMS

451 EMS: ALS - Mileage $8.00 2/1/2009

448 EMS: ALS - Transport $525.00 2/1/2009

450 EMS: ALS - Non-Transport $125.00 2/1/2009

452 EMS: BLS - Mileage $8.00 2/1/2009

449 EMS: BLS - Transport $425.00 2/1/2009

453 EMS: 50% Dextrose $4.00 2/1/2009

454 EMS: Glucagon Hypo Kit $85.00 2/1/2009

455 EMS: Narcon $17.00 2/1/2009

447 EMS: ALS2 - Transport $625.00 new fee 2/1/2009

Public Safety - Excise

472 Copies $0.25 per copy, if under Sunshine law request .10per copy

7/1/2000

474 Full Drink Liquor License $375.00 per license annually, (30 day extension is$31.25)

3/3/1989

467 Caterer's Permit $15.00 per caterer's permit per 168 consecutivehours

3/3/1989

484 Sunday Drink License $375.00 per license annually 3/3/1989


462 Application for Liquor License $200.00 per liquor application 3/3/1989

463 Placarding for License $30.00 per liquor application 3/3/1989

470 Plat Fee $100 00 per plat 7/1/1999



470 Plat Fee $100.00 per plat 7/1/1999

485 Picnic License $25.00 per 7 day picnic license 3/3/1989

471 Sunday Original Package $300.00 per permit annual, (30 day extension fee is($25.00)

1/10/1996

475 Full Package Liquor License $250.00 per license annually, (30 day extension is$20.83)

3/3/1989

481 5% Package License $35.00 per license annually 3/3/1989

479 5% Drink License $87.50 per license annually 3/3/1989

478 22% Drink License $300.00 per license annually 3/3/1989

469 Sunday Amusement Permit $200.00 per year, per annual permit, (30 dayextension fee is $16.67)

3/3/1989

468 Sunday Entertainment Permit $375.00 per year, per annual permit, (30 dayextension fee is $31.25)

3/3/1989

482 Microbrewery License $250.00 per license annually 3/3/1989

476 Full Wholesaler License $600.00 per license annually (30 day extension$50.00)

3/3/1989

480 22% Package License $150.00 per license annually 3/3/1989

483 Consumption of Liquor License $180.00 per license annually 3/3/1989

473 Dishonored Check Fee $20.00 per returned checked fee 3/3/1989

466 Sunday Dance Hall $200.00 per annual permit 3/3/1989

477 Full Manufacturer License $500.00 per license annually 3/3/1989

486 22% Wholesaler License $250 00 per license annually 3/3/1989


498 Fire Protection: Fire Pump $100.00 per inspection

499 Fire Protection: Fire Alarms (1-10) $20.00 per inspection

500 Fire Protection: Fire Alarms (11 20) $30 00 per inspection





502 Fire Protection: Fire Alarms (30+) $10.00 for each 10 alarms, per inspection

503 Fire Protection: Special/Follow-Up Inspection $20.00 per inspection

492 Fire Protection: Sprinkler Certification $25.00 per employee

495 Fire Protection: File Search $25.00 per inspection

488 Fire Protection: Propane Permits $20.00 per event

487 Fire Protection: Cooking Hood Suppression $100.00 per inspection 1/1/1999

490 Fire Protection: Fuel Tank Permits $25.00 per inspection

491 Fire Protection: Welding/Cutting Permits $30.00 per company

496 Fire Protection: Nuisance Fines $100.00 per event

489 Fire Protection: Pyrotechnic Permits $25.00 per event

493 Fire Protection: Live Burn Permits $25.00 per event

494 Fire Protection: Fire Extinguisher Certification $25.00 per person per company

Public Safety - Housing Conservation

371 Certificate of Inspection $70.00 $110 if occupied prior to inspection, $25 foreach additional unit inspected in samebuilding

7/1/2008

Public Safety - Neighborhood Stabilization

460 Litt Cit ti Fi 1 t Ti i 6 M th $25 00 fl t t fi d bl if t id ti 2/27/2008


307 Telecom License Charge $2.03 per linear foot 6/1/2008

308 Telecom License Charge $2.75 per linear foot

309 Telecom License Charge $4 10 per linear foot



309 Telecom License Charge $4.10 per linear foot

310 Cable Franchise Agreement allowed to charge up to 5% of a cablecompany's gross revenue as compensationfor use of the right of the way.

Recorder of Deeds

518 State Tax Lien $3.00 each 7/1/2002

519 State Tax Release $1.50 each 7/1/2002 520 Application/Marriage License $48.00 per application 7/1/2002

509 Federal Tax Lien $3.00 each 7/1/2002

510 Federal Tax Release $1.50 each 7/1/2002

515 Platt Copies $8.00 per copy 7/1/2002

517 State Expungment $3.00 each 7/1/2002

516 Rent of Office Space $507.74 per company per month 7/1/2002

521 Duplicate Marriage License $15.00 per copy 7/1/2002

508 Archive Research Copy $13.00 each 7/1/2002

511 Land Record Recording - First Page $23.00 for first page, $5 for each additional page 7/1/2002

512 Land Record Recording - Additional Pages $5.00 per additional page after first 7/1/2002

513 Land Record Certified Copies - First Page $5.00 for first page, $2 for each additional page 7/1/2002

514 Land Record Certified Copies - Additional Page $2.00 per additional page after first 7/1/2002

522 Marriage License Certified Copies $12.00 certified copy 7/1/2002


526 Death Records Certified Copies - Multiple Copies ofSame Record

$10.00 certified copy 7/1/2002

527 Death Records Research $13.00 research 7/1/2002



Streets - Refuse

336 Refuse: Evictions - Crew $200.00 per crew hour

335 Refuse: Sale of Cart $75.00 per cart 10/1/1993

342 Refuse: Placement of Containers - Roll Off $375.00 per roll of container 7/1/2003

340 Refuse: Placement of Containers - 300 gal containers $100.00 per 300 gallon container 7/1/2003

343 Refuse: Placement of Containers - Laclede's $1,000.00 Laclede's Landing 7/1/2003

337 Refuse: Evictions - Pick-Up Truck $75.00 per pickup truck load

338 Refuse: Evictions - Flat Bed Truck $150.00 per flat bed truck load

339 Refuse: Evictions - Dump Truck $200.00 per dump truck load

341 Refuse: Placement of Containers - 600 gal containers $200.00 per 600 gallon container 7/1/2003

Streets - Streets

347 Street Maintenance: Paving $5.00 per square foot 11/1/2008

348 Street Maintenance: Sealing $5.00 per linear foot 11/1/2008

317 Blocking Streets - "S" Permits $20.00 per "S" permit 9/1/2008

313 Bike Racks $5.00 per rack + $1 deposit per rack 6/1/2008

312 Barricades & Misc $2.10 per day + $25 delivery Charge 3/1/2008

355 Loading Zone $2.00 per foot 6/1/2005

315 Blocking Streets (Residential) $10.00 per week 9/1/2008


314 Blocking Streets (Non-Residential) $20.00 per day 9/1/2008

334 50/50 Sidewalk Payments fee varies 6/1/2005

331 Sidewalk (Residential) $10 00 residential zoned areas 9/1/2000



331 Sidewalk (Residential) $10.00 residential zoned areas 9/1/2000

332 Sidewalk (Non-Residential) $50.00 non-residential zoned areas 9/1/2000

321 Driveway (Commercial) $50.00 9/1/2000

322 Driveway (Residential) $20.00 9/1/2000

328 Parking (w/o parking meter) $10.00 25 ft without parking meter 9/1/2000

329 Parking (w/ parking meter) $10.00 streets with parking meters 9/1/2000

311 Bad Checks Fee $20.00 per check

353 "D" Contractor Payments cost + 15% overhead charges

326 Parade $100.00 per permit 9/1/2000

327 Parade (Residential) $20.00 per permit - Residential 9/1/2000

316 Blocking Streets - Block Parties $20.00 per day per street 9/1/2008

330 Sales of Maps $5.00 per map

318 Busking $25.00 per permit

333 Vacation of Streets $200.00 Parallel CDA sq ft cost 9/1/2000

345 Street Maintenance: Leaf & Debris $450.00 per hour 10/1/2008

319 Cart Vendors $25.00 per permit for one year

324 Merchandise Display $25.00 per permit, per square foot 6/10/2005

344 Street Maintenance: Damages - Property cost + 15% overhead charges

346 Street Maintenance: Miscellaneous Streets Permit


358 Traffic Count Books & Misc (large book) $10.00 per large book

Streets - Tow Lot



349 Towing Fees $100.00 per vehicle 7/1/2001

351 Towing Fees: Storage $25.00 per hour per vehicle 1/1/2008

352 Towing Fees: Auction per vehicle

350 Towing Fees: Labor $80.00 per hour per vehicle 7/1/2001

Municipal Code

718 Application Fee/Building Line Survey $25.00

719 Certificate of Flood Plain Status $10.00

720 Permit for New Constructions and Additions $15.00 $5/$1000 of estimated project cost. $15.00minimum

721 Permit for Alterations and Repairs to Existing Building $15.00 $5/$1000 of estimated project cost. $15.00minimum

722 Tank Permit $15.00 $5/$1000 of estimated project cost. $15.00minimum

723 Tent Permit $15.00

724 Moving of Building Permit: Within City Limits $15.00 $1/$100 of estimated cost $15.00 minimum

725 Moving of Building Permit: To Outside City Limits $15.00 $1/$100 of estimated cost $15.00 minimum

726 Moving of Building Permit: From outside to within CityLimits

$15.00 $1/$100 of estimated cost $15.00 minimum

727 Moving or Building Permit: Foundation for Building $15.00 $5/$1000 of estimated project cost. $15.00minimum

728 Explosives Permit: Blasting for Trenching $100.00 $100/250 lineal feet. $100 minimum


731 Addendum to Permit: Amendment involving decreaseor no increase in project costs

$25.00

732 Duplicate Copy of Building Permit, Occupancy Permit,or Certification of Inspection

$1.00 per copy



or Certification of Inspection

733 Re-Issuance of Occupancy Permit: Name Change $5.00 per copy

734 Costs for Approving Additional Sets of ConstructionDocuments

$1.00 per page

735 Demolition Inspection Fee (<10,000 cu. Ft.) $15.00 per site

736 Demolition Inspection Fee (>10,000 cu. Ft.) $25.00 per site

737 Applicant Request Emergency and SpecialtyInspection $25.00

738 Ground Signs (<100 sq. ft.) $100.00

739 Ground Signs (>100 sq. ft.) $160.00

740 Roof Sign (<100 sq. ft.) $100.00

741 Roof Sign (>100 sq. ft.) $160.00

742 Wall Sign (<100 sq. ft.) $100.00

743 Wall Sign (>100 sq. ft.) $160.00

744 Projecting Sign (<100 sq. ft.) $100.00

745 Projecting Sign (>100 sq. ft.) $160.00

746 Special or Temporary Display Signs Requiring Permits $100.00 minimum fee.

747 Lettering and/or Graphics on Awnings and Canopies $50.00

750 Demolition Permit (<10,000 cu. Ft.) $10.00

751 Demolition Permit (>10,000 cu. Ft.) $15.00 per every 10,000 cu. Ft. $25.00 minimum


755 Building Permit Surcharge ($501-$2000) $360.00

756 Building Permit Surcharge ($2001-$10000) $480.00

757 Building Permit Surcharge (>$10000) $600.00



757 Building Permit Surcharge (>$10000) $600.00

758 Demolition Permit Surcharge ($0-$50) $100.00





763 Demolition Permit Surcharge (>$1000) $660.00

764 Demolition Contractors Certification Board:Temporary Certificate Application (Class I)

$120.00

765 Demolition Contractors Certification Board:Temporary Certificate Application (Class II)

$30.00

766 Demolition Contractors Certification Board: SpecialCertificate Application

$60.00

767 Demolition Contractors Certification Board:Certification Fees (Class I)

$120.00 Per job basis

768 Demolition Contractors Certification Board:Certification Fees (Class II)

$30.00 Per job basis

769 Electrical & Mechanical Permit Surcharge ($0-$50) $30.00



772 Electrical & Mechanical Permit Surcharge ($501-

$2000)

$360.00


776 Stationary Engineer's License: Permit per Day $100.00

777 License Replacement $25.00 Plumbers, Sprinkler fitters, Backflow testers

778 Plumbing: Homeowners Examination $25.00 covers cost of application and exam. Valid



g $ ppfor 2 years

779 Plumbing: All other tests administered by St. Louis $50.00

780 Fire Prevention Permit: Commercial Kitchen ExhaustSystems

$100.00 per system

781 Fire Prevention Permit: Open burning $25.00

782 Fire Prevention Permit: Removing Paint with Torch $25.00

783 Fire Prevention Permit: Assembly Occupancies $25.00

784 Fire Prevention Permit: Flammable Liquids $25.00 per operation

785 Fire Prevention Permit: Flammable Finishes $25.00

786 Fire Prevention Permit: Fumigation - Insecticide $20.00 per operation

787 Fire Prevention Permit: Organic Coating $25.00 use of more than one gallon per day

788 Fire Prevention Permit: Tents/Air Supported Structures $25.00 per tent

789 Fire Prevention Permit: Waste Handling $25.00

790 Fire Prevention Permit: Individual Site $20.00 each operation

791 Fire Prevention Permit: Citywide $30.00 annual

792 Fire Prevention Permit: Calcium carbide $25.00

793 Fire Prevention Permit: Acetylene generators $25.00

794 Fire Prevention Permit: Storage, handling, and use ofblasting agents

$60.00

795 Fireworks: Storage (no more than 48 hours) $25.00


799 Flammable and Combustible Liquids: Storage Vaults $25.00

800 Flammable and Combustible Liquids: Abondment,

Installation, or Removal of Tank

$25.00



801 Flammable and Combustible Liquids: Tank Repair $20.00

802 Flammable and Combustible Liquids: Tank Cleaning $20.00

803 Liquefied Petroleum Gas: Exhibits, Demonstrations,Picnics, Carnivals

$20.00

804 Liquefied Petroleum Gas: Bulk Installation $25.00 per vessel

805 Liquefied Petroleum Gas: Use on Construction Sites $50.00

806 Liquefied Petroleum Gas: Launching Fire PropelledBalloons

$25.00 per launch

807 Vehicle Tire Rebuilding Plant $25.00

808 Miscellaneous Inspection: Public Service Permits $25.00

809 Miscellaneous Inspection: Initial Inspection $25.00

810 Miscellaneous Inspection: Inspections not covered inFire Code

$25.00

811 Witnessing Tests: Leaking Tanks $50.00

812 Witnessing Tests: Fire Pumps $100.00

813 Witnessing Tests: Fire Fighting Foam Equipment $25.00

814 Witnessing Tests: Final Fire Alarm Inspection $100.00

815 Flammable Liquid Tank Certification $30.00

816 Firework Discharge Certification $25.00

817 Firework Registration $30.00


821 Plumbing Apprentice Registration $5.00

822 Payment of Fees $20.00

832 Miscellaneous Structure Permit $5.00



833 Fuel Gas Code Violation $500.00

834 Front Yard Line Survey $10.00 fee for a survey necessary to establish thefront yard line requirements of any usedistricts

835 Fire Protection Connection Service Charge $108.00 per year, assessed per connection madewith Water Division mains

836 Water Rates: Room Charge $3.03 each, use of water for residences forperiods of 3 months in advance

837 Water Rates: Water Closet $13.14 each, use of water for residences forperiods of 3 months in advance

838 Water Rates: Baths $11.03 each, use of water for residences forperiods of 3 months in advance

839 Water Rates: Shower $11.03 each shower separate from bath, use ofwater for residences for periods of 3 monthsin advance

840 Water Rates: Sprinkler Charge $0.22 per front foot, for each 3 month billingperiod (lawn sprinkler, other)

841 Water Utility: Swimming Pools/Ponds (cap. 100-501cubic ft)

$20.67 payable for periods of three (3) months inadvance

842 Water Utility: Swimming Pools/Ponds (cap. 501-1,001cubic ft)


843 Water Utility: Swimming Pools/Ponds (cap. 1,101-1,500 cubic ft)


844 Water Utility: Swimming Pools/Ponds (cap. 1,501- $45.47 payable for periods of three (3) months in


846 Water Utility: Metered Rates (3/4" meter) $24.80 readiness-to-serve charge per 3 monthbilling period

847 Water Util ity: Metered Rates (1" meter) $31.45 readiness-to-serve charge per 3 monthbilling period



g p

848 Water Utility: Metered Rates (1.5" meter) $45.47 readiness-to-serve charge per 3 monthbilling period






854 Water Utility: Metered Rates (10" meter) $909.15 readiness-to-serve charge per 3 monthbilling period

855 Water Utility: Meter Rates - Quantity Charge (first25,000 cubic ft)

$1.58 per 100 cubic feet, for first 25,000 cubic feetper billing

856 Water Utility: Meter Rates - Quantity Charge (next1.975M cubic ft)

$1.23 per 100 cubic feet, between 25K and 2Mcubic feet

857 Water Utility: Meter Rates - Quantity Charge (over 2Mcubic ft)

$0.93 per 100 cubic feet, over 2M cubic feet

858 Water Utility: Meter Rates - Approved Not-for-Profits $0.83 per 100 cubic feet, hospital or charitableinstitution approved by Commissioner

859 Water Utility: Meter Rates - Not-for-Profits $0.93 per 100 cubic feet, schools, public libraries,

art museum, and city and county MuseumDi i


861 Sewer District: Charge for Repair Leaking LateralLines

$28.00 annual, on residential property with 0-6dwelling units

877 Special Demolition Fund $2.00 per $1000 of estimated cost or fractionthereof



878 Lead Remediation Fund $2.00 per $1000 of estimated cost or fractionthereof

879 Energy Code Conservation $500.00 maximum per day

880 Application Fee:Building Permit for Structures;Blasting and Inspection Fees

$25.00

881 Applicant Request for Lead Inspection $100.00

882 Investigation of Records: Violation Letters $25.00

883 Cost of Emergency Repairs owner responsible for 100% of cost ofemergency repairs completed by city plus10% interest (issued as real estate tax bill,lien will be placed upon non-collection)

884 Property Maintenance Code Violation $500.00 maximum per day

885 Smoke House Code Violation $100.00 minimum per day

886 Theatrical Barge Inspection Fee $5.00 per 1000 seats, fractional amounts allowedafter first 1000 seats

887 Trailer Park Annual License Fee $25.00 minimum for 5 or fewer spaces, $5 for eachadditional space in excess of 5 spaces(annual license)

888 Trailer Park Violation range of $5-$200 fine per day

889 Smoke Detector Violation range of $25-$500 fine



Appendix C: Comparable Fee

Inventory

Appendix C

Appendix C: Comparable Fee Inventory

DEPARTMENT OF HEALTH & HOSPITALS

Jurisdiction Fee Title FeeCost

Detail



Cost

City of St Louis,Missouri

Permit Renewal - Food Establishment (g.r.<$0.1M)

$35.00minimum, up to $100,000 ingross sales during the prior year

City of Baltimore,Maryland

Low Risk Food Dealer/Restaurant License $185.00 Annual permit

Moderate Risk Food Dealer/Restaurant License $350.00 Annual permit

High Risk Food Dealer/Restaurant License $450.00 Annual permit

Indianapolis,Indiana

Food Establishment Annual Operating License

(0-9 EE)

$432.00 Annual permit

Food Establishment Annual Operating License(10-40 EE)


Food Establishment Annual Operating License(40+ EE)


Kansas City,Missouri

Food Establishment Operating Permit: 0-5 EE $275.00 Annual permit



Food Establishment Operating Permit: 40+ EE $480.00 Annual permit

Plan Review: New Business Risk 1establishment < 1,000 sq. ft.


Plan Review: New Business Risk 1establishment 1,001--3,000 sq. ft.




Plan Review: New Business Risk 1establishment 5,001--7,000 sq ft.


Plan Review: New Business Risk 2

Appendix C


Jurisdiction Fee TitleFeeCost

Detail


Permit Renewal - Food Establishment (g.r.$0 1-$0 5M)

$100.00prior year gross receiptsbetween $100 000 and $500 000



Missouri $0.1-$0.5M) between $100,000 and $500,000

























Plan Review: New Business Risk 2t bli h t 1 000 ft


Appendix C



Detail


Permit Renewal - Food Establishment (g.r.>$0 5M)

$150.00prior year gross receipts$500 000 +



Missouri >$0.5M) $500,000 +

























Plan Review: New Business Risk 2establishment < 1 000 sq ft


Appendix C



Detail


Permit Renewal: Low Risk FoodEstablishment

$75.00per year for 1 inspection -proposed fee structure



Missouri Establishment proposed fee structure








Food Establishment Annual Operating License(40+ EE) $725.00 Annual permit






Minneapolis,Minnesota









St. Louis County,Missouri

Food Establishment Permit Renewal: grosssales $100,000 - $500,000


Food Establishment Permit Renewal: grosssales >$500 000 $451.00 Annual permit

Appendix C



Detail


Permit Renewal: Moderate Risk FoodEstablishment

$150.00per year for 2 inspections -proposed fee structure



Missouri Establishment proposed fee structure

























Food Establishment Permit Renewal: grosssales $100,000 - $500,000


Food Establishment Permit Renewal: grosssales >$500 000 $451.00 Annual permit

Appendix C

DEPARTMENT OF HEALTH AND HOSPITALS


Detail


Permit Renewal: High Risk FoodEstablishment

$225.00 per year for 3 or 4 inspections -proposed fee structure










Food Establishment Annual Operating License(40+ EE) $725.00 Annual permit
















Food Establishment Permit Renewal: grosssales <$100,000


Food Establishment Permit Renewal: grosssales $100,000 - $500,000 $322.00 Annual permit

Appendix C



Detail


New Food Establishment Permit $35.00 Per New Food Establishment




New Food Establishment Plan Review $150.00 Annual permit


New Food Establishment Permit: < 3,000 sq. ft. $246.00 Annual permit

New Food Establishment Permit: 3,001 - 30,000sq. ft.






New Food Establishment Permit: : 60,000+ sq. ft. $712.00 Annual permit


Processing Fee $50.00Per application, new foodestablishment or change of ownership

New Food Establishment Permit, 0-5 EE $275.00 Annual permit

New Food Establishment Permit: 6-9 EE $345.00 Annual permit

New Food Establishment Permit: 10-40 EE $410.00 Annual permit

New Food Establishment Permit: 40+ EE $480.00 Annual permitPlan Review: New Business Risk 1 establishment< 1,000 sq. ft.


Plan Review: New Business Risk 1 establishment1,001--3,000 sq. ft.


Plan Review: New Business Risk 1 establishment3,001--5,000 sq. ft.


Plan Review: New Business Risk 1 establishment5,001--7,000 sq ft.


Plan Review: New Business Risk 2 establishment $289 00 Annual permit

Appendix C



Detail


Plan Review - Food Establishment $0.00 per new or remodeled foodestablishment




Health Plan Review Inspection $0.00 Annual Permit


Food Establishment Plan Review: 0-5 EE $70.00 per permit



Food Establishment Plan Review: 40+ EE $120.00 per permit


Plan Review: New Business Risk 1establishment < 1,000 sq. ft. $348.00 Annual permit








establishment < 1,000 sq. ft.$289.00 Annual permit












Appendix C



Detail


Temporary Food Establishment Permit $35.00 per Event




Temporary Food Dealer Permits: Permit(Temporary - $50, $100.00Provisional - $100)

$100.00 Valid for <14 days


Temporary Food Establishment Permit $40.001 day of operation, $13 for eachsubsequent day

Temporary Food Establishment OperatingPermit

$325.00 Annual operating permit


Temporary Food Permit: 1 Day Operation $50.00

Temporary Food Permit: 2 Days Operation $75.00

Temporary Food Permit: 3-14 Days Operation $150.00

Temporary Food Permit: Not for profit $25.00 < 14 days


Short Term Food Permit $84.00 Annual permit

Short Term Food Permit - Seasonal $226.00 Annual permit


Food Establishment Permit: Temporary $35.00 < 14 days

Appendix C

DEPARTMENT OF STREETS

JurisdictionFee Title

FeeCost Detail


Bike Racks $5.00 per rack + $1 deposit per rack



Appendix C



FeeCost Detail


Blocking Streets (Non-Residential) $20.00 per day




Temporary Use of Right of Way -Special Event

$73.00 $35 Public Works and $38 Fire Inspection

Temporary Alley Closure Permit $55.00 per week

Temporary Curb Lane Closure Permit $65.00 per week

Temporary Street Closure Permit $85.00 per week

Temporary Footway Closure Permit $55.00 per week


Right of Way: Blocking Sidewalk $35.00 per block per weekRight of Way: Blocking Non-Thoroughfare

$65.00 parking lanes or shoulders

Right of Way: Blocking ThoroughfareParking lane

$120.00 per block per lane per week

Right of Way: Blocking non-thoroughfare Traffic lanes

$80.00

Right of Way: Blocking thoroughfareTraffic lane

$160.00 per block, per lane, per week


Block Events: Commercial Districts

(45+ days prior) $200.00

either central or neighborhood commercial

districtsBlock Events: Commercial Districts (30-44 days prior)

$250.00either central or neighborhood commercialdistricts

Block Events: Commercial Districts (20-29 days prior)


Block Events: Commercial Districts (11-19 days prior)



Blocking Streets Permit - residential andnon residential

$208 per unit

Appendix C



FeeCost Detail


Blocking Streets (Residential) $10.00 per week




Temporary Use of Right of Way - Special Event $73.00$35 Public Works and $38Fire Inspection






Right of Way: Blocking Sidewalk $35.00 per block per weekRight of Way: Blocking Non-Thoroughfare $65.00 parking lanes or shoulders

Right of Way: Blocking Thoroughfare Parking lane $120.00 per block per lane per week

Right of Way: Blocking non-thoroughfare Traffic lanes $80.00

Right of Way: Blocking thoroughfare Traffic lane $160.00per block, per lane, per week


Blocking Streets (Residential) $131.00 Application fee


Block Events: Residential Districts (35+ days prior) $25.00

Block Events: Residential Districts (22-34 days prior) $40.00





Blocking Streets Permit - residential and nonresidential

$208 per unit

Appendix C


Jurisdiction Fee Title Fee Cost Detail

City of St Louis,Missouri Blocking Streets - Block Parties $20.00 per day per street

$35 Public Works and $38




Temporary Use of Right of Way - Special Event $73.00$35 Public Works and $38Fire Inspection





Indianapolis,

Indiana Blocking Streets - Block Parties $0.00 per permitKansas City,Missouri

Blocking Streets - Block Parties $0.00 per permit


Block Events: Large Block Events (90+ days prior) $1,285.00

Block Events: Large Block Events (89-60 daysprior)

$1,850.00

Block Events: Large Block Events (less than 60days prior)

$2,775.00

Appendix C



FeeCost Detail


Excavation $65.00 per permit, cover dig-rite fees




Temporary Use of Right of Way - Street Cutting $100.00 per cut




Right of Way: Pavement Excavation(Thoroughfare)

$120.00min fee, $1020 max fee, rate $1 per sq ftfor 500ft or 1 block of class 1 street

Right of Way: Pavement Excavation (Non-Thoroughfare)

$120.00min fee, $5500 max fee, rate $1 per sq ftfor 500ft or 1 block of class 2/3 street

Right of Way: Pavement Excavation (Utilities) $50.00certified utilities class 3 streets per 500feet or block


Excavation Application Permit $143.00

for all excavations up to 100 lineal feet,and for each additional 100 lineal feet of excavation or portion thereof an additional$143.00 shall be charged


Right-of-Way Obstruction Permit: Other Area -Parking Lane $0.15 per curb foot per day

Right-of-Way Obstruction Permit: Other Area -Driving Lane

$0.50 per lane foot per day

Right-of-Way Obstruction Permit: Other Area -Sidewalk/Boulevard Area

$0.10 per curb foot per day

Right-of-Way Obstruction Permit: DowntownArea - Parking Lane

$0.25 per curb foot per day

Right-of-Way Obstruction Permit: DowntownArea - Driving Lane

$1.00 per lane foot per day

Right-of-Way Obstruction Permit: DowntownArea - Sidewalk/Boulevard Area $0 25 per curb foot per day

Appendix C



Detail


UE Ameron: Re-hook ElectricityConnection

$25.00 residential and commercial electricityre-hook up inspection




Electrical Permit: InitialConnection/Reconnection of Electrical Power

$40.00electrical power moving from one toanother location


Electrical Permits: Utility Connections $48.00Excludes reconnection due to fireoccurring within 90 days prior



Appendix C

DEPARTMENT OF PUBLIC SAFETY



Electrical Permit: Electrical Outlets $40.00for first unit, plus $1 for eachadditional unit inspected -Commercial/Industrial

f 25 l fi t $5 f h




Electrical Permit: Electrical Fixturesor Devices

$25.00for 25 or less fixtures, $5 for eachadditional 25 or fraction of 25 fixtures or devices


Permit for Electrical Activity $55.00


Electrical Permit: All Other BuildingTypes ($0-$500)

$48.00 total valuation



Electrical Permit: All Other BuildingTypes ($2001-$200,000)

$86.00

for the first $2,000 total valuation - plus$12.50 per additional $1,000.00 or fraction thereof, up to and including$200,000.00

Electrical Permit: All Other BuildingTypes ($200,001-$1M)

$2,561.00for the first $200,000 total valuation - plus$8.30 per additional $1,000.00 or fractionthereof, up to and including $1 million

Electrical Permit: All Other BuildingTypes ($1M+)

$9,201.00 for the first $1M total valuation - plus$3.60 per additional $1,000.00 or fractionthereof


Electrical permits are issued by the State of Minnesota, Department of Labor and Industry,Electrical Division


Electrical Permit: Electrical Outlets $7.00For first unit, $0.60 for each additionalunit, plus $22 permit processing fee

Appendix C



City of St Louis,Missouri Electrical Permit: PanelBoards/Switchboard $40.00 for the first unit, plus $10 for eachadditional section

Electrical Service Wiring and Equipment$25 00

to be installed, replaced, or relocated,



City of Baltimore,

Maryland

Electrical Service Wiring and Equipment(0-100 Amps)

$25.00to be installed, replaced, or relocated,for services over 600 volts, add $100





Electrical Service Wiring and Equipment

(400-800 Amps)$60.00

to be installed, replaced, or relocated,

for services over 600 volts, add $100Electrical Service Wiring and Equipment(800-1,000 Amps)


Electrical Service Wiring and Equipment(1,000-2,000 Amps)


Electrical Service Wiring and Equipment(2,000+ Amps)



Electrical Permit: Installation of Electrical Power Distribution System

$55.00min fee, general rate is 20% of bldgpermit fee

Electrical Permit: Electrical Power Distribution System (repair/modify)

$35.00Min fee, general rate is $10 per $1,000of total value







$86.00

for the first $2,000 total valuation - plus$12.50 per additional $1,000.00 or fraction thereof, up to and including$200 000 00

Appendix C



City of St Louis,Missouri Electrical Permit: Transformers $40.00

for the first unit, plus $10 for eachadditional unit

Electrical Installation Permits: Installation




of Electrical Transformers only (1-10KVA)

$25.00

Electrical Installation Permits: Installationof Electrical Transformers only (over 10-50 KVA)

$35.00

Electrical Installation Permits: Installationof Electrical Transformers only (over 50-

100 KVA)

$75.00

Electrical Installation Permits: Installationof Electrical Transformers only (over 100KVA)

$100.00


Electrical Permit: Installation of ElectricalPower Distribution System

$55.00min fee, general rate is 20% of bldgpermit fee


$35.00Min fee, general rate is $10 per $1,000 of total value







$86.00

for the first $2,000 total valuation -plus $12.50 per additional $1,000.00or fraction thereof, up to and including$200,000.00

Electrical Permit: All Other BuildingTypes ($200,001-$1M)

$2,561.00

for the first $200,000 total valuation -plus $8.30 per additional $1,000.00 or fraction thereof, up to and including $1

million

Appendix C



Detail


Electrical Permit: X-Rays $40.00 for the first unit, plus $10 for eachadditional unit




Electrical Installation Permits: NotOtherwise Classified

$25.00 per permit




Electrical Permit: X-Ray $8.00per x-ray, plus $22 permit processingfee

Appendix C



Detail


Electrical Permit: Carnivals $50.00 per location, Inspection of wiring andelectrical equipment

Cit f B lti El t i l I t ll ti P it T f h 5 kil tt f ti f 5 kil tt f




Electrical Installation Permits: TempElectrical Wiring (Circus/Carnival Only)

$25.00for each 5 kilowatts or fraction of 5 kilowatts of feeder capacity supplying the wiring


Electrical permits are issued by the State of Minnesota, Department of Labor and Industry, ElectricalDivision

St. Louis County,

Missouri

Electrical Permit: Carnival device inspection $28 per device, plus $22 permit processing fee

Electrical Permit: Carnival $22 per permit, plus $22 permit processing fee

Electrical Permit: Inspection overtime feefor carnivals

$195 per inspection, plus $22 permit processing fee

Appendix C



Detail


Electrical Permit: Reinspection $25.00 for the first reinspection

El t i l I t ll ti P it




Electrical Installation Permit:Reinspection Fee (1st)

$35.00 For first reinspection

Electrical Installation Permit:Reinspection Fee (2nd)

$50.00 For second reinspection

Electrical Installation Permit:Reinspection Fee (3rd+)

$100.00For third and any subsequentreinspection


Electrical Permit: Reinspection Fee $67.00when work has not beencorrected/completed after twoinspections

Electrical Permit: Reinspection Fee for Work Outside of Normal BusinessHours

$53.00 per hour, with a min of $212




Electrical Permit: Reinspection $41.00 per reinspection

Appendix C



Detail


Electrical Permit: Reinspection forCertification

$100.00 for the first reinspection

Cit f B lti h i d t f th it




Electrical Certificates of Approval $10.00when issued as part of the permit,otherwise $20




Electrical Permit: Reinspection $41.00 per reinspection

Appendix C



Detail


Electrical Permit: Residential -Repair/Modify

$40.00 for the first unit, plus $30 for eachadditional unit

branch circuits feeders and extensions to




Electrical Wiring for New or Replacement Construction

$6.00branch circuits, feeders, and extensions toor per circuit, replacements of branchcircuits

Electrical Installation: Fixture andDevices

$25.00up to 25 fixtures,$5 for each additional 25or fraction of 25 fixtures or devices

Electrical Service Wiring andEquipment (0-100 Amps)

$25.00to be installed, replaced, or relocated, for services over 600 volts, add $100


$30.00 to be installed, replaced, or relocated, for services over 600 volts, add $100





Electrical Service Wiring andEquipment (800-1,000 Amps)


Electrical Service Wiring andEquipment (1,000-2,000 Amps) $150.00

to be installed, replaced, or relocated, for services over 600 volts, add $100

Electrical Service Wiring andEquipment (2,000+ Amps)



Installation of Electrical Power Distribution System

$55.00min fee, general rate is 20% of bldg permitfee

Electrical Power DistributionSystem (repair/modify)


Electrical Permit: One- and Two-

Family Dwelling ($0-$1000)


Appendix C



Detail


Electrical Permit: Residential -Repair/Modify with Service


Electrical Wiring for New or branch circuits feeders and extensions to or





$6.00branch circuits, feeders, and extensions to or per circuit, replacements of branch circuits


$25.00up to 25 fixtures,$5 for each additional 25 or fraction of 25 fixtures or devices


$25.00to be installed, replaced, or relocated,Including provision for connection of meter

Electrical Service Wiring andEquipment (100-200 Amps) $30.00

to be installed, replaced, or relocated,Including provision for connection of meter





Electrical Service Wiring andEquipment (800-1,000 Amps)


Electrical Service Wiring and

Equipment (1,000-2,000 Amps)

$150.00to be installed, replaced, or relocated,

Including provision for connection of meter Electrical Service Wiring andEquipment (2,000+ Amps)







Electrical Permit: One- and Two-Family Dwelling ($0-$1000)


Electrical Permit: One and Two

Appendix C



Detail


Electrical Permit: Residential -Service Only


Electrical Permit: One and Two








Electrical Permit: One- and Two-Family Dwelling ($2001-$100,000)

$54.00for the first $2,000 total valuation - plus $4per additional $1,000.00 or fractionthereof, up to and including $100,000.00

Electrical Permit: One- and Two-Family Dwelling ($100,000+)

$446.00for the first $2,000 total valuation - plus$1.30 per additional $1,000.00 or fractionthereof




Electrical Permit: Service Only $34.00per dwelling, each additional unit $34,plus $22 permit processing fee

Appendix C



Detail


Electrical Permit: Residential - NewConstruction (including rehab)


El t i l Wi i f Nbranch circuits, feeders, and extensions to





$6.00branch circuits, feeders, and extensions toor per circuit, replacements of branchcircuits


$25.00up to 25 fixtures, $5 for each additional 25or fraction of 25 fixtures or devices




$30.00 to be installed, replaced, or relocated,Including provision for connection of meter





Electrical Service Wiring and Equipment(800-1,000 Amps)


Electrical Service Wiring and Equipment(1,000-2,000 Amps) $150.00

to be installed, replaced, or relocated,Including provision for connection of meter

Electrical Service Wiring and Equipment(2,000+ Amps)







Electrical Permit: One- and Two-Family

Dwelling ($0 $1000)


Appendix C

DEPARTMENT OF PARKS, RECREATION & FORESTRY


FeeCost Detail

City of St Louis,Missouri All City Parks: Athletic Field Rental -Lighted Field $15.00 flat hourly rate

City of BaltimorePark & Athletic Field: Lighted Fields(admission charged)

$50.00per hour (Utz, Riverside, Latrobe, Ortman,Leon Day Mt Pleasant Druid Hill)




(admission charged) Leon Day, Mt. Pleasant, Druid Hill)

Park & Athletic Field: Lighted Fields (noadmission charged)

$30.00per hour (Utz, Riverside, Latrobe, Ortman,Leon Day, Mt. Pleasant, Druid Hill)

Indianapolis

Athletic Field Lights $45.00 per hour per field plus field rentalAthletic Field Lights - Chuck Klein SoftballComplex

$20.00per hour per field plus field rental

Athletic Fields: Practice Fields A-C $22.00

max per day; min $17 per day (plus lining,

equipment and other related costs, youthorganizations receive 25% discount)

Athletic Fields: League Fields A-C $45.00max per day; min $35 per day (plus lining,equipment and other related costs, youthorganizations receive 25% discount)

Athletic Fields: Tournament Fields A-C $110.00

max per day (A); B-$95 per day; C-$60 per day (plus lining, equipment and other relatedcosts, youth organizations receive 25%discount)

Kansas City,

MissouriAthletic Field Rental $12.00

per hour per field or complex


Athletic Field Rental: Lights (Resident) $25.00per hour plus staffing and admin fee - Adults &Use by College

Athletic Field Rental: Lights (Non-Resident)

$30.00per hour plus staffing and admin fee - Adultsand Commercial Groups

Athletic Field Rental: Lights (Youth) $0.00plus admin fee and staffing - public schools,youth teams and associations

Athletic Field Lights $30.00per hour in addition to field rental - plus adminand staffing fees

St. Louis County,

Missouri

All City Parks: Athletic Field Rental -

Lighted Field$18.00

per hour

Appendix C



FeeCost Detail


All City Parks: Athletic Field Rental -Unlighted Field $8.00 flat hourly rate

Park & Athletic Field: Non-Lighted Fields(Adult Teams)

$15.00 per hour




(Adult Teams)

Park & Athletic Field: Non-Lighted Fields(Youth Teams)

$7.50 per hour

Park & Athletic Field: General Use or Practice $5.00 per hour

Park & Athletic Field: Organized Play $15.00per hour (Private of commercial entitiesare subject to a $5/person surchargebased upon maximum team roster)

Indianapolis

Athletic Field Lights $45.00 per hour per field plus field rentalAthletic Field Lights - Chuck Klein SoftballComplex

$20.00 per hour per field plus field rental

Athletic Fields: Practice Fields A-C $22.00

max per day; min $17 per day (pluslining, equipment and other relatedcosts, youth organizations receive 25%discount)

Athletic Fields: League Fields A-C $45.00

max per day; min $35 per day (pluslining, equipment and other relatedcosts, youth organizations receive 25%

discount)

Athletic Fields: Tournament Fields A-C $110.00

max per day (A); B-$95 per day; C-$60per day (plus lining, equipment and other related costs, youth organizationsreceive 25% discount)


Athletic Field Rental $12.00per hour per field or complex

Athletic Field Rental - Baseball/Softball Field(Resident)

$25.00per hour plus staffing and admin fee -Adults & Use by College

Athletic Field Rental - Baseball/Softball Field

(Non Resident)$40.00

per hour plus staffing and admin fee -

Adults and Commercial Groups

Appendix C



FeeCost Detail

City of St Louis,Missouri All City Parks: Picnics - Picnic PavilionElectric Weekdays $45.00 weekday rate

City of Baltimore, Other Park Use: Pavilions (With Electricity) $185.00 for 8 hours



MarylandOther Park Use: Pavilions (With Electricity) $185.00 for 8 hours

Indianapolis,

Indiana

Picnic Shelter Rental Fee: Small withElectricity

$75.00 per day - capacity 25-40

Picnic Shelter Rental Fee: Medium withElectricity

$100.00 per day - capacity 50-60

Picnic Shelter Rental Fee: Large withElectricity

$125.00 per day - capacity 70+

Pavilion & Corporate Shelters: Sahm ParkShelter

$275.00 per day

Pavilion & Corporate Shelters: Eagle CreekBeach Shelter

$275.00(for first 100 people; $1 eachadditional guest)

Garfield Park Pagoda or Corporate Center $250.00 per day


Small Shelter House $60.00 per day, half day $40

Large Shelter House $80.00 per day, half day $50


Picnic Site: Capacity 50 or less (half day) $100.00 electricity included in price

Picnic Site: Capacity 50 or less (whole day) $200.00 electricity included in price

Picnic Site: Large Picnic Pavilion Building(1/2 day)

$250.00electricity included in price - TheodoreWirth and Minneahaha Falls MainPavilion

Picnic Site: Large Wirth Picnic PavilionBuilding (whole day)


Picnic Site: Other Pavilion capacity 150-250(1/2 day)

$200.00electricity included in price

Picnic Site: Other Pavilion capacity 150-250(whole day)


Picnic Shelter: Beard's Plaisance (1/2 day) $150 00 l t i it i l d d i i

Appendix C



City of St Louis,

Missouri

All City Parks: Picnics - Picnic Pavilion

Electric Weekends $65.00 weekend rate


Other Park Use: Pavilions (With Electricity) $185.00for 8 hours



Maryland for 8 hours


Picnic Shelter Rental Fee: Small withElectricity

$75.00per day - capacity 25-40

Picnic Shelter Rental Fee: Medium withElectricity

$100.00per day - capacity 50-60

Picnic Shelter Rental Fee: Large withElectricity

$125.00per day - capacity 70+

Pavilion & Corporate Shelters: Sahm ParkShelter $275.00 per dayPavilion & Corporate Shelters: Eagle CreekBeach Shelter

$275.00(for first 100 people; $1 eachadditional guest)

Garfield Park Pagoda or Corporate Center $250.00 per day





Picnic Site: Capacity 50 or less (half day) $100.00 electricity included in price

Picnic Site: Capacity 50 or less (whole day) $200.00 electricity included in price

Picnic Site: Large Picnic Pavilion Building(1/2 day)




Picnic Site: Other Pavilion capacity 150-250 (1/2 day)


Picnic Site: Other Pavilion capacity 150-250 (whole day)


Picnic Shelter: Beard's Plaisance (1/2 day) $150 00 electricity included in price

Appendix C



FeeCost Detail

City of St Louis,Missouri All City Parks: Picnics - PicnicPavilion No Electric Weekdays $35.00 weekday rate

City of Baltimore,Other Park Use: Pavilions (WithoutElectricity)

$135.00for 8 hours



y ,Maryland

Electricity) for 8 hours

Picnic Areas: Uncovered $110.00 for 8 hours

Indianapolis,

Indiana

Picnic Pavilion: Eagle Crest Group PicnicArea

$330.00for first 100 people, $1 per additionalguest

Pavilion & Corporate Shelters: PostRoad

$110.00per day

Pavilion & Corporate Shelters: Riverside

(shelter #6 + knoll)$220.00

per dayPicnic Shelter Rental Fee: Small $75.00 per day - capacity 25-40

Picnic Shelter Rental Fee: Medium $100.00 per day - capacity 50-60

Picnic Shelter Rental Fee: Large $125.00 per day - capacity 70+





Picnic Site: Capacity 50 or less (half day) $100.00 electricity included in pricePicnic Site: Capacity 50 or less (wholeday) $200.00 electricity included in price

Picnic Site: Large Picnic PavilionBuilding (1/2 day)






Picnic Site: Other Pavilion capacity 150-

250 (whole day) $400 00 electricity included in price

Appendix C



FeeCost Detail

City of St Louis,Missouri All City Parks: Picnics - PicnicPavilion No Electric Weekends $60.00 weekend rate

City of Baltimore,Other Park Use: Pavilions (WithoutElectricity)

$135.00for 8 hours



yMaryland

Electricity) for 8 hours

Picnic Areas: Uncovered $110.00 for 8 hours

Indianapolis,

Indiana

Picnic Pavilion: Eagle Crest GroupPicnic Area

$330.00for first 100 people, $1 per additionalguest

Pavilion & Corporate Shelters: PostRoad

$110.00per day

Pavilion & Corporate Shelters: Riverside

(shelter #6 + knoll)$220.00

per dayPicnic Shelter Rental Fee: Small $75.00 per day - capacity 25-40

Picnic Shelter Rental Fee: Medium $100.00 per day - capacity 50-60

Picnic Shelter Rental Fee: Large $125.00 per day - capacity 70+





Picnic Site: Capacity 50 or less (half day)


Picnic Site: Capacity 50 or less (wholeday)


Picnic Site: Large Picnic PavilionBuilding (1/2 day)






Picnic Site: Other Pavilion capacity 150 $400 00



Appendix D: Construction Permit Fees

Appendix D

Appendix D: Construction Permit Fees

CITY OF ST LOUIS, MISSOURI

CONSTRUCTION FEE SCHEDULE

EstimatedC t ti

Application Permit TotalN t



ConstructionCost

ApplicationFee

PermitFee

TotalFee

Notes

$0 - $1,000 $25.00 $19.00 $44.00

$1,001- $2,000 $25.00 $23.00 $48.00

$2,001 - $3,000 $25.00 $27.00 $52.00

Over $3,000 $25.00 $9.00

per thousand estimated construction

cost or fraction thereof

Appendix D

CITY OF BALTIMORE, MARYLAND


Fee Title Fee Description

Construction Permit: 1 and 2-FamilyDwellings - New Construction

$10.00 for each 1,000 cubic feet or fraction of 1,000 cubicfeet of gross volume, minimum $100

Construction Permit: 1 and 2-Family$10 00

for each 1,000 cubic feet or fraction of 1,000 cubic



yDwellings - Additions

$10.00, ,

feet of gross volume, minimum $75Construction Permit: All Others -New Construction

$20.00for each 1,000 cubic feet or fraction of 1,000 cubicfeet of gross volume, minimum $200

Construction Permit: All Others -Additions

$20.00for each 1,000 cubic feet or fraction of 1,000 cubicfeet of gross volume, minimum $100

Appendix D

CONSOLIDATED CITY AND COUNTY INDIANAPOLIS/MARION, INDIANA


Fee Title Fee DescriptionClass 2 Construction Permit:Constructions or Additions

$0.05per square foot of gross floor area, excluding the area of anunfinished basement or attic, minimum of $135

Class 2 Construction Permit:



Class 2 Construction Permit:Appurtenant

$0.05per square foot of gross floor area, minimum $65

Class 1 Construction Permit:Constructions or Additions

$0.10per square foot of gross floor area, each floor, minimum$215

Class 2 Construction Permit:Remodel, Alter, or Repair

minimum $65, or the lesser of $15 per $1,000 of total valueor $0.05 per square foot of gross floor area of each floor

Class 1 Construction Permit:Remodel, Alter, or Repair minimum $120, or the lesser of $15 per $1,000 of total valueor $0.10 per square foot of gross floor area of each floor

Appendix D

KANSAS CITY, MISSOURI


Fee Title Fee DescriptionOne- And Two-Family Detached DwellingPermits (total valuation $0-$1,000)

$48.00

One- And Two-Family Detached Dwelling$54 00



y gPermits (total valuation $1,001-$2,000)

$54.00

One- And Two-Family Detached DwellingPermits (total valuation $2,001-$100,000)

$54.00for the first $2,000, plus $4.00 for eachadditional $1,000 or fraction thereof

One- And Two-Family Detached DwellingPermits (total valuation $100,000+)


Non 1 or 2-Family Detached Dwelling Permits

(total valuation $0-$500)

$48.00

Non 1 or 2-Family Detached Dwelling Permits(total valuation $501-$2,000)

$86.00

Non 1 or 2-Family Detached Dwelling Permits(total valuation $2,001-$200,000)


Non 1 or 2-Family Detached Dwelling Permits(total valuation $200,001-$1,000,000)

$2,561.00for the first $200,000, plus $8.30 for eachadditional $1,000 or fraction thereof

Non 1 or 2-Family Detached Dwelling Permits(total valuation $1,000,000+)

$9,201.00for the first $1,000,000, plus $3.60 for eachadditional $1,000 or fraction thereof

Appendix D

CITY OF MINNEAPOLIS, MINNESOTA

CONSTRUCTION FEE SCHEDULE*

Fee Title Fee DescriptionBuilding, Wrecking, Moving Permit ($1-$500 valuation)

$30.50

Building, Wrecking, Moving Permit$30 50

for the first $500, plus $3.80 per additional $100 or



g, g, g($501-$2,000 valuation)

$30.50, p p

fraction thereof, minimum $69.75Building, Wrecking, Moving Permit($2,001-$25,000 valuation)

$87.50for the first $2,000, plus $17.05 per additional $1,000or fraction thereof

Building, Wrecking, Moving Permit($25,001-$50,000 valuation)

$479.65for the first $25,000, plus $12.35 per additional $1,000or fraction thereof

Building, Wrecking, Moving Permit

($50,001-$100,000 valuation)

$788.40for the first $50,000, plus $8.70 per additional $1,000

or fraction thereof Building, Wrecking, Moving Permit($100,001-$500,000 valuation)

$1,223.40for the first $100,000, plus $6.95 per additional $1,000or fraction thereof

Building, Wrecking, Moving Permit($500,001-$1,000,000 valuation)

$4,003.40for the first $500,000, plus $5.70 per additional $1,000or fraction thereof

Building, Wrecking, Moving Permit($1,000,001+ valuation)

$6,854.40for the first $1,000,000, plus $4.65 per additional$1,000 or fraction thereof

* Fees are subject to State Surcharge and are based on valuation, (contract price including labor and

materials). Building permits for new buildings or remodeling to existing buildings require an additional 65%

of the permit fee added for the plan review fee.

Appendix D

ST LOUIS COUNTY, MISSOURI

RESIDENTIAL CONSTRUCTION FEE SCHEDULEFees based on total cost

Fee Title Fee Fee Title FeeTotal Cost $0-$1,000 $73 Total Cost $52,001-$56,000 $295

Total Cost $1,001-$2,000 $82 Total Cost $56,001-$58,000 $304

$ $








Total Cost $7,001-$8,000 $156 Total Cost $68,001-$70,000 $347Total Cost $8,001-$9,000 $161 Total Cost $70,001-$72,000 $354














T t l C t $38 001 $39 000 $230 T t l C t $98 001 $100 000 $466

Appendix D


RESIDENTIAL CONSTRUCTION FEE SCHEDULE CONTINUEDFees based on total cost

Fee Title Fee Fee Title FeeTotal Cost $135,001-$140,000 $612 Total Cost $310,001-$320,000 $1,224

Total Cost $140,001-$145,000 $627 Total Cost $320,001-$330,000 $1,253















Total Cost $210,001-$220,000 $893 Total Cost $500,001-$520,000 $1,850Total Cost $220,001-$230,000 $927 Total Cost $520,001-$540,000 $1,915



Total Cost $250,001-$260,000 $1,025 Total Cost $580,001-$600,000 $2,092




T t l C t $290 001 $300 000 $1 158 T t l C t $660 001 $680 00 $2 330

Appendix D


COMMERCIAL CONSTRUCTION FEE SCHEDULEFees based on total cost

Fee Title Fee Fee Title FeeTotal Cost $0-$1,000 $73 Total Cost $64,001-$66,000 $498
















Total Cost $25,001-$27,000$284

Total Cost $92,001-$94,000$670








T t l C t $39 001 $40 000 $352 T t l C t $120 001 $125 000 $838

Appendix D



Fee Title Fee Fee Title FeeTotal Cost $185,001-$190,000 $1,202 Total Cost $640,001-$660,000 $3,480
















Total Cost $310,001-$320,000$1,872

Total Cost $920,001-$940,000$4,726




Total Cost $350,001-$360,000 $2,073 Total Cost $1.0-1.1 million $5,394




T t l C t $390 001 $400 000 $2 267 T t l C t $1 4 1 5 illi $7 041

Appendix D



Fee Title Fee Fee Title FeeTotal Cost $2.7-2.8 million $12,061 Total Cost $8.4-8.6 million $31,788

Total Cost $2.8-2.9 million $12,435 Total Cost $8.6-8.8 million $32,420

$12 808 $33 051



Total Cost $2.9-3 million $12,808 Total Cost $8.8-9 million $33,051

Total Cost $3-3.1 million $13,181 Total Cost $9-9.2 million $33,684




Total Cost $3.4-3.5 million $14,636 Total Cost $9.8-10 million $36,200Total Cost $3.5-3.6 million $14,990 Total Cost $10-10.5 million $37,756

Total Cost $3.6-3.7 million $15,346 Total Cost $10.5-11 million $39,303

Total Cost $3.7-3.8 million $15,708 Total Cost $11-11.5 million $40,837


Total Cost $3.9-4 million $16,419 Total Cost $12-12.5 million $43,884

Total Cost $4-4.2 million $17,118 Total Cost $12.5-13 million $45,397




Total Cost $4.8-5 million $19,905 Total Cost $14.5-15 million $51,365

Total Cost $5-5.2 million $20,595 Total Cost $15-15.5 million $53,119




T t l C t $5 8 6 illi $23 290 T t l C t $17 17 5 illi $59 970

Appendix D



Fee Title Fee Fee Title FeeTotal Cost $23.5-24 million $82,098 Total Cost $37-37.5 million $126,342


$ $85 508 $ $129 755








Total Cost $27-27.5 million $94,070 Total Cost $40.5-41 million $138,059Total Cost $27.5-28 million $95,777 Total Cost $41-41.5 million $139,760














T t l C t $34 5 35 illi $117 806 T t l C t $48 48 5 illi $163 619



Appendix E: San Luis Obispo,

California User Fee Policy

Budget and Fiscal Policies

FINANCIAL PLAN PURPOSEAND ORGANIZATION

2. Concentrating on developing and budgetingfor the accomplishment of significant



A. Financial Plan Objectives. Through itsFinancial Plan, the City will link resources withresults by:

1. Identifying community needs for essentialservices.

2. Organizing the programs required to providethese essential services.

3. Establishing program policies and goals,which define the nature and level of program services required.

4. Identifying activities performed indelivering program services.

5. Proposing objectives for improving thedelivery of program services.

6. Identifying and appropriating the resourcesrequired to perform program activities andaccomplish program objectives.

objectives.

3. Establishing realistic timeframes forachieving objectives.

4. Creating a pro-active budget that provides

for stable operations and assures the City'slong-term fiscal health.

5. Promoting more orderly spending patterns.

6. Reducing the amount of time and resourcesallocated to preparing annual budgets.

C. Measurable Objectives. The two-yearfinancial plan will establish measurable programobjectives and allow reasonable time toaccomplish those objectives.

D. Second Year Budget. Before the beginning of the second year of the two-year cycle, theCouncil will review progress during the firstyear and approve appropriations for the secondfiscal year.


1. Operating revenues must fully coveroperating expenditures, including debtservice.

2. Ending fund balance (or working capital inthe enterprise funds) must meet minimumpolicy levels. For the general and enterprisefunds, this level has been established at 20%of operating expenditures.

adoption by majority vote of the Councilmembers. The CAO has the authority to makeadministrative adjustments to the budget as longas those changes will not have a significantpolicy impact nor affect budgeted year-end fund

balances.

GENERAL REVENUE MANAGEMENT



p g p

Under this policy, it is allowable for totalexpenditures to exceed revenues in a given year;however, in this situation, beginning fundbalance can only be used to fund capital

improvement plan projects, or other “one-time,”non-recurring expenditures.

FINANCIAL REPORTINGAND BUDGET ADMINISTRATION

A. Annual Reporting. The City will prepareannual financial statements as follows:

1. In accordance with Charter requirements,the City will contract for an annual audit bya qualified independent certified publicaccountant. The City will strive for anunqualified auditors’ opinion.

2. The City will use generally accepted

i i i l i i i l

A. Diversified and Stable Base. The City willseek to maintain a diversified and stable revenuebase to protect it from short-term fluctuations in

any one revenue source.

B. Long-Range Focus. To emphasize andfacilitate long-range financial planning, the Citywill maintain current projections of revenues forthe succeeding five years.

C. Current Revenues for Current Uses. The Citywill make all current expenditures with current

revenues, avoiding procedures that balancecurrent budgets by postponing neededexpenditures, accruing future revenues, orrolling over short-term debt.

D. Interfund Transfers and Loans. In order toachieve important public policy goals, the Cityhas established various special revenue, capital

j d b i d i f d


In summary, interfund transfers result in achange in fund equity; interfund borrowings donot, as the intent is to repay in the loan in thenear term.

From time-to-time, interfund borrowings may beappropriate; however, these are subject to thefollowing criteria in ensuring that the fiduciarypurpose of the fund is met:

interim period based on supplemental analysiswhenever there have been significant changes inthe method, level or cost of service delivery.

B. User Fee Cost Recovery Levels

In setting user fees and cost recovery levels, thefollowing factors will be considered:



purpose of the fund is met:

1. The Director of Finance & InformationTechnology is authorized to approvetemporary interfund borrowings for cash

flow purposes whenever the cash shortfall isexpected to be resolved within 45 days. Themost common use of interfund borrowingunder this circumstance is for grantprograms like the Community DevelopmentBlock Grant, where costs are incurred beforedrawdowns are initiated and received.However, receipt of funds is typicallyreceived shortly after the request for funds

has been made.

2. Any other interfund borrowings for cashflow or other purposes require case-by-caseapproval by the Council.

3. Any transfers between funds wherereimbursement is not expected within one

fi l h ll b d d i f d

1. Community-Wide Versus Special Benefit.

The level of user fee cost recovery shouldconsider the community-wide versus special

service nature of the program or activity.

The use of general-purpose revenues isappropriate for community-wide services,while user fees are appropriate for servicesthat are of special benefit to easily identifiedindividuals or groups.

2. Service Recipient Versus Service Driver.

After considering community-wide versusspecial benefit of the service, the concept of

service recipient versus service driver should also be considered. For example, itcould be argued that the applicant is not thebeneficiary of the City's development reviewefforts: the community is the primarybeneficiary. However, the applicant is thedriver of development review costs, and assuch, cost recovery from the applicant is

i


for specific services, it may be impracticalor too costly to establish a system to identifyand charge the user. Accordingly, thefeasibility of assessing and collectingcharges should also be considered in

developing user fees, especially if significant program costs are intended to befinanced from that source.

D. Factors Favoring High Cost Recovery Levels

The use of service charges as a major source of funding service levels is especially appropriateunder the following circumstances:

1. The service is similar to services providedthrough the private sector.



C. Factors Favoring Low Cost Recovery Levels

Very low cost recovery levels are appropriateunder the following circumstances:

1. There is no intended relationship betweenthe amount paid and the benefit received.Almost all "social service" programs fallinto this category as it is expected that onegroup will subsidize another.

2. Collecting fees is not cost-effective or willsignificantly impact the efficient delivery of

the service.

3. There is no intent to limit the use of (orentitlement to) the service. Again, most“social service” programs fit into thiscategory as well as many public safety(police and fire) emergency responseservices. Historically, access to

i hb h d d i k ld

2. Other private or public sector alternativescould or do exist for the delivery of theservice.

3.

For equity or demand managementpurposes, it is intended that there be a directrelationship between the amount paid andthe level and cost of the service received.

4. The use of the service is specificallydiscouraged. Police responses todisturbances or false alarms might fall intothis category.

5. The service is regulatory in nature andvoluntary compliance is not expected to bethe primary method of detecting failure tomeet regulatory requirements. Buildingpermit, plan checks and subdivision reviewfees for large projects would fall into thiscategory.


4. Rate structures should be sensitive to the"market" for similar services as well as tosmaller, infrequent users of the service.

5. A unified approach should be used in

determining cost recovery levels for variousprograms based on the factors discussedabove.

cost of determining need may be greaterthan the cost of providing a uniform servicefee structure to all participants. Further,there is a community-wide benefit inencouraging high-levels of participation in

youth and senior recreation activitiesregardless of financial status.

3 Cost recovery goals for recreation activities



F. Low Cost-Recovery Services

Based on the criteria discussed above, thefollowing types of services should have very

low cost recovery goals. In selectedcircumstances, there may be specific activitieswithin the broad scope of services provided thatshould have user charges associated with them.However, the primary source of funding for theoperation as a whole should be general-purposerevenues, not user fees.

1. Delivering public safety emergency

response services such as police patrolservices and fire suppression.

2. Maintaining and developing public facilitiesthat are provided on a uniform, community-wide basis such as streets, parks andgeneral-purpose buildings.

3

P idi i l i d

3. Cost recovery goals for recreation activitiesare set as follows:

High-Range Cost Recovery Activities (60% to 100%)

a. Classes (Adult and Youth)b. Day care servicesc. Adult athletics (volleyball, basketball,

softball, lap swim)d. Facility rentals (Jack House, other in-

door facilities except the City/CountyLibrary)

Mid-Range Cost Recovery Activities (30% to 60%)

e. City/County Library room rentalsf. Special events (triathlon, other City-

sponsored special events)g. Youth track h. Minor league baseballi. Youth basketball

j

S i l


a. The fee is reducing attendance.

b. And there are no appreciableexpenditure savings from the reducedattendance.

5. Charges will be assessed for use of rooms,pools, gymnasiums, ball fields, special-useareas, and recreation equipment for activities

c. Engineering (public improvement planchecks, inspections, subdivisionrequirements, encroachments).

d. Fire plan check.

2. Cost recovery for these services shouldgenerally be very high. In most instances,the City's cost recovery goal should be



not sponsored or co-sponsored by the City.Such charges will generally conform to thefee guidelines described above. However,the Director of Parks and Recreation isauthorized to charge fees that are closer to

full cost recovery for facilities that areheavily used at peak times and include amajority of non-resident users.

6. A vendor charge of at least 10 percent of gross income will be assessed fromindividuals or organizations using Cityfacilities for moneymaking activities.

7. Director of Parks and Recreation isauthorized to offer reduced fees such asintroductory rates, family discounts andcoupon discounts on a pilot basis (not toexceed 18 months) to promote newrecreation programs or resurrect existingones.

8 Th P k d R i D ill

100%.

3. However, in charging high cost recoverylevels, the City needs to clearly establishand articulate standards for its performance

in reviewing developer applications toensure that there is “value for cost.”

I. Comparability With Other Communities

In setting user fees, the City will consider feescharged by other agencies in accordance withthe following criteria:

1. Surveying the comparability of the City'sfees to other communities provides usefulbackground information in setting fees forseveral reasons:

a. They reflect the "market" for these feesand can assist in assessing thereasonableness of San Luis Obispo's

f


d. What level of service do they providecompared with our service orperformance standards?

e. Is their rate structure significantlydifferent than ours and what is itintended to achieve?

3. These can be very difficult questions to

At 3.5%, water and sewer franchise fees arebased on the mid-point of the statewide standardfor public utilities like electricity and gas (2% of gross revenues from operations) and cabletelevision (5% of gross revenues).

As with other utilities, the purpose of thefranchise fee is reasonable compensation the useof the City’s street right-of-way The



address in fairly evaluating fees amongdifferent communities. As such, thecomparability of our fees to othercommunities should be one factor amongmany that is considered in setting City fees.

ENTERPRISE FUND FEES AND RATES

A. Water, Sewer and Parking. The City will setfees and rates at levels which fully cover thetotal direct and indirect costs—includingoperations, capital outlay and debt service—of

the following enterprise programs: water, sewerand parking.

B. Golf. Golf program fees and rates should fullycover direct operating costs. Because of thenine-hole nature of the golf course with its focuson youth and seniors, subsidies from the GeneralFund to cover indirect costs and capitalimprovements may be considered by the Council

f h i i l l l i h

of the City s street right-of-way. Theappropriateness of charging the water and sewerfunds a reasonable franchise fee for the use of City streets is further supported by the results of recent studies in Arizona, California, Ohio and

Vermont which concluded that the leading causefor street resurfacing and reconstruction is streetcuts and trenching for utilities.

REVENUE DISTRIBUTION

The Council recognizes that generally acceptedaccounting principles for state and local

governments discourage the “earmarking” of General Fund revenues, and accordingly, thepractice of designating General Fund revenues forspecific programs should be minimized in the City'smanagement of its fiscal affairs. Approval of thefollowing revenue distribution policies does notprevent the Council from directing General Fundresources to other functions and programs as


For several years following the passage of Proposition 13, the City made property taxallocations between funds on a policy basis thatwere generally in proportion to those in placebefore Proposition 13. Because these were

general-purpose revenues, this practice wasdiscontinued in 1992-93. With the adoption of aseries of technical revisions to the City Charterin November of 1996 this conflict no longer

factors will be considered in priority order indetermining individual investment placements:

1. Safety

2. Liquidity

3. Yield

C. Tax and Revenue Anticipation Notes: Not for



in November of 1996, this conflict no longerexists.

B. Gasoline Tax Subventions. All gasoline taxrevenues (which are restricted by the State for

street-related purposes) will be used formaintenance activities. Since the City's totalexpenditures for gas tax eligible programs andprojects are much greater than this revenuesource, operating transfers will be made fromthe gas tax fund to the General Fund for thispurpose. This approach significantly reducesthe accounting efforts required in meeting Statereporting requirements.

C. Transportation Development Act (TDA)Revenues. All TDA revenues will be allocatedto alternative transportation programs, includingregional and municipal transit systems, bikewayimprovements, and other programs or projectsdesigned to reduce automobile usage. BecauseTDA revenues will not be allocated for street

i i h l i

Investment Purposes. There is an appropriaterole for tax and revenue anticipation notes(TRANS) in meeting legitimate short-term cashneeds within the fiscal year. However, manyagencies issue TRANS as a routine business

practice, not solely for cash flow purposes, butto capitalize on the favorable difference betweenthe interest cost of issuing TRANS as a tax-preferred security and the interest yields on themif re-invested at full market rates.

As part of its cash flow management andinvestment strategy, the City will only issue

TRANS or other forms of short-term debt if necessary to meet demonstrated cash flow needs;TRANS or any other form of short-term debtfinancing will not be issued for investmentpurposes. As long as the City maintains itscurrent policy of maintaining fund/workingcapital balances that are 20% of operatingexpenditures, it is unlikely that the City wouldneed to issue TRANS for cash flow purposes

i l i


The investment market is highly volatile andcontinually offers new and creativeopportunities for enhancing interest earnings.Accordingly, the City will thoroughlyinvestigate any new investment vehicles before

committing City funds to them.

G. Authorized Institutions. Current financialstatements will be maintained for each

the Investment Oversight Committee withappropriate investment performanceinformation.

APPROPRIATIONS LIMITATION

A. The Council will annually adopt a resolutionestablishing the City's appropriations limit



statements will be maintained for eachinstitution in which cash is invested.Investments will be limited to 20 percent of thetotal net worth of any institution and may bereduced further or refused altogether if aninstitution's financial situation becomesunhealthy.

H. Consolidated Portfolio. In order to maximizeyields from its overall portfolio, the City willconsolidate cash balances from all funds forinvestment purposes, and will allocateinvestment earnings to each fund in accordancewith generally accepted accounting principles.

I. Safekeeping. Ownership of the City'sinvestment securities will be protected throughthird-party custodial safekeeping.

J. Investment Management Plan. The CityTreasurer will develop and maintain anInvestment Management Plan that addresses the

establishing the City s appropriations limitcalculated in accordance with Article XIII-B of the Constitution of the State of California,Section 7900 of the State of CaliforniaGovernment Code, and any other voter approved

amendments or state legislation that affect theCity's appropriations limit.

B. The supporting documentation used incalculating the City's appropriations limit andprojected appropriations subject to the limit willbe available for public and Council review atleast 10 days before Council consideration of aresolution to adopt an appropriations limit. The

Council will generally consider this resolution inconnection with final approval of the budget.

C. The City will strive to develop revenue sources,both new and existing, which are considerednon-tax proceeds in calculating itsappropriations subject to limitation.


FUND BALANCE AND RESERVES

A. Minimum Fund and Working CapitalBalances. The City will maintain a minimum

fund balance of at least 20% of operatingexpenditures in the General Fund and aminimum working capital balance of 20% of operating expenditures in the water, sewer and

D. Other Designations and Reserves. In additionto the designations noted above, fund balancelevels will be sufficient to meet fundingrequirements for projects approved in prior yearswhich are carried forward into the new year;

debt service reserve requirements; reserves forencumbrances; and other reserves ordesignations required by contractual obligations,state law, or generally accepted accounting



operating expenditures in the water, sewer andparking enterprise funds. This is considered theminimum level necessary to maintain the City'scredit worthiness and to adequately provide for:

1.

Economic uncertainties, local disasters, andother financial hardships or downturns in thelocal or national economy.

2. Contingencies for unseen operating orcapital needs.

3. Cash flow requirements.

As part of the City’s budget-balancing strategy

for 2005-07, the projected ending fund balanceat June 30, 2007 will be 15% of operatingexpenditures. It is the City’s goal to return tothe full policy level in 2007-09.

B. Fleet Replacement. For the General Fund fleet,the City will establish and maintain a FleetReplacement Fund to provide for the timely

state law, or generally accepted accountingprinciples.

CAPITAL IMPROVEMENT MANAGEMENT

A. CIP Projects: $15,000 or More. Constructionprojects and equipment purchases which cost$15,000 or more will be included in the CapitalImprovement Plan (CIP); minor capital outlaysof less than $15,000 will be included with theoperating program budgets.

B. CIP Purpose. The purpose of the CIP is to

systematically plan, schedule, and financecapital projects to ensure cost-effectiveness aswell as conformance with established policies.The CIP is a four-year plan organized into thesame functional groupings used for the operatingprograms. The CIP will reflect a balancebetween capital replacement projects that repair,replace or enhance existing facilities, equipment


E. CIP Phases. The CIP will emphasize projectplanning, with projects progressing through atleast two and up to ten of the following phases:

1. Designate. Appropriates funds based on

projects designated for funding by theCouncil through adoption of the FinancialPlan.

than will be constructed or purchased during theterm of the CIP.

F. CIP Appropriation. The City’s annual CIPappropriation for study, design, acquisition

and/or construction is based on the projectsdesignated by the Council through adoption of the Financial Plan. Adoption of the FinancialPlan CIP appropriation does not automatically



2. Study. Concept design, site selection,feasibility analysis, schematic design,environmental determination, propertyappraisals, scheduling, grant application,grant approval, specification preparation forequipment purchases.

3. Environmental Review. EIR preparation,other environmental studies.

4. Real Property Acquisitions. Propertyacquisition for projects, if necessary.

5. Site Preparation. Demolition, hazardousmaterials abatements, other pre-constructionwork.

6. Design. Final design, plan and specificationpreparation and construction cost estimation.

7. Construction. Construction contracts.

Plan CIP appropriation does not automaticallyauthorize funding for specific project phases.This authorization generally occurs only afterthe preceding project phase has been completedand approved by the Council and costs for thesucceeding phases have been fully developed.

Accordingly, project appropriations aregenerally made when contracts are awarded. If project costs at the time of bid award are lessthan the budgeted amount, the balance will beunappropriated and returned to fund balance orallocated to another project. If project costs atthe time of bid award are greater than budget

amounts, five basic options are available:

1. Eliminate the project.

2. Defer the project for consideration to thenext Financial Plan period.

3. Rescope or change the phasing of the projectto meet the existing budget.


phase for conformance with the City's public artpolicy, which generally requires that 1% of eligible project construction costs be set asidefor public art. Excluded from this requirementare underground projects, utility infrastructure

projects, funding from outside agencies, andcosts other than construction such as study,environmental review, design, site preparation,land acquisition and equipment purchases.

should be created and implemented at levelssufficient to ensure that new developmentpays its fair share of the cost of constructingnecessary community facilities.

4. Transportation impact fees are a majorfunding source in financing transportationsystem improvements. However, revenuesfrom these fees are subject to significant



q q p p

It is generally preferred that public art beincorporated directly into the project, but this isnot practical or desirable for all projects; in thiscase, an in-lieu contribution to public art will bemade. To ensure that funds are adequatelybudgeted for this purpose regardless of whetherpublic art will be directly incorporated into theproject, funds for public art will be identifiedseparately in the CIP.

CAPITAL FINANCINGAND DEBT MANAGEMENT

A. Capital Financing

1. The City will consider the use of debtfinancing only for one-time capitalimprovement projects and only under thefollowing circumstances:

j gfluctuation based on the rate of newdevelopment. Accordingly, the followingguidelines will be followed in designing andbuilding projects funded with transportationimpact fees:

a. The availability of transportation impactfees in funding a specific project will beanalyzed on a case-by-case basis asplans and specification or contractawards are submitted for CAO orCouncil approval.

b. If adequate funds are not available atthat time, the Council will make one of two determinations:

• Defer the project until funds areavailable.

• Based on the high-priority of theproject, advance funds from the


c. Market conditions are unstable orpresent difficulties in marketing.

Factors Favoring Long Term Financing

d. Revenues available for debt service aredeemed sufficient and reliable so thatlong-term financings can be marketedwith investment grade credit ratings.

necessary for marketing purposes,availability and cost-effectiveness.

5. The City will monitor all forms of debtannually coincident with the City's Financial

Plan preparation and review process andreport concerns and remedies, if needed, tothe Council.



g g

e. The project securing the financing is of the type, which will support aninvestment grade credit rating.

f. Market conditions present favorableinterest rates and demand for Cityfinancings.

g. A project is mandated by state or federalrequirements, and resources areinsufficient or unavailable.

h. The project is immediately required tomeet or relieve capacity needs and

current resources are insufficient orunavailable.

i. The life of the project or asset to befinanced is 10 years or longer.

B. Debt Management

1. The City will not obligate the General Fund

6. The City will diligently monitor itscompliance with bond covenants and ensureits adherence to federal arbitrageregulations.

7. The City will maintain good, ongoingcommunications with bond rating agenciesabout its financial condition. The City willfollow a policy of full disclosure on everyfinancial report and bond prospectus(Official Statement).

C. Debt Capacity

1. General Purpose Debt Capacity. The Citywill carefully monitor its levels of general-purpose debt. Because our general purposedebt capacity is limited, it is important thatwe only use general purpose debt financingfor high-priority projects where we cannotreasonably use other financing methods for


well as operations, maintenance,administration and capital improvementcosts. The ability to afford new debt forenterprise operations will be evaluated as anintegral part of the City’s rate review and

setting process.

D. Independent Disclosure Counsel

E. Land-Based Financings

1. Public Purpose. There will be a clearlyarticulated public purpose in forming anassessment or special tax district in

financing public infrastructureimprovements. This should include afinding by the Council as to why this formof financing is preferred over other funding



The following criteria will be used on a case-by-case basis in determining whether the Cityshould retain the services of an independentdisclosure counsel in conjunction with specificproject financings:

1. The City will generally not retain theservices of an independent disclosurecounsel when all of the followingcircumstances are present:

a. The revenue source for repayment isunder the management or control of the

City, such as general obligation bonds,revenue bonds, lease-revenue bonds orcertificates of participation.

b. The bonds will be rated or insured.

2. The City will consider retaining the servicesof an independent disclosure counsel whenone or more of following circumstances are

g p goptions such as impact fees, reimbursementagreements or direct developerresponsibility for the improvements.

2. Eligible Improvements. Except asotherwise determined by the Council whenproceedings for district formation arecommenced, preference in financing publicimprovements through a special tax districtshall be given for those publicimprovements that help achieve clearlyidentified community facility andinfrastructure goals in accordance with

adopted facility and infrastructure plans asset forth in key policy documents such asthe General Plan, Specific Plan, Facility orInfrastructure Master Plans, or CapitalImprovement Plan. Such improvementsinclude study, design, construction and/oracquisition of:

a. Public safety facilities.


i. Other governmental facilities andimprovements such as offices,information technology systems andtelecommunication systems.

School facilities will not be financed exceptunder appropriate joint community facilitiesagreements or joint exercise of powersagreements between the City and school

district, with the public improvements,should be at least four times the amount of the assessment or special tax debt. Inspecial circumstances, after conferring andreceiving the concurrence of the City’s

financial advisor and bond counsel that alower value-to-debt ratio is financiallyprudent under the circumstances, the Citymay consider allowing a value-to-debt ratio



districts.

3. Active Role. Even though land-basedfinancings may be a limited obligation of theCity, we will play an active role in

managing the district. This means that theCity will select and retain the financingteam, including the financial advisor, bondcounsel, trustee, appraiser, disclosurecounsel, assessment engineer andunderwriter.

Any costs incurred by the City in retaining

these services will generally be theresponsibility of the property owners ordeveloper, and will be advanced via adeposit when an application is filed; or willbe paid on a contingency fee basis from theproceeds from the bonds.

4. Credit Quality. When a developer requestsa district, the City will carefully evaluate the

y gof 3:1. The Council should make specialfindings in this case.

7. Appraisal Methodology. Determination of value of property in the district shall bebased upon the full cash value as shown onthe ad valorem assessment roll or upon anappraisal by an independent MemberAppraisal Institute (MAI). The definitions,standards and assumptions to be used forappraisals shall be determined by the Cityon a case-by-case basis, with input fromCity consultants and district applicants, and

by reference to relevant materials andinformation promulgated by the State of California, including the AppraisalStandards for Land-Secured Financingsprepared by the California Debt andInvestment Advisory Commission.

8. Capitalized Interest During Construction.




working capital to do so from othersources.

2. Standards for Economic Savings. Ingeneral, refinancings for economic savings

will be undertaken whenever net presentvalue savings of at least five percent (5%) of the refunded debt can be achieved.

3. To manage the growth of the regular work force and overall staffing costs, the City willfollow these procedures:

a. The Council will authorize all regular

positions.b. The Human Resources Department will

coordinate and approve the hiring of allregular and temporary employees



a. Refinancings that produce net presentvalue savings of less than five percentwill be considered on a case-by-casebasis, provided that the present valuesavings are at least three percent (3%) of the refunded debt.

b. Refinancings with savings of less thanthree percent (3%), or with negativesavings, will not be considered unlessthere is a compelling public policyobjective.

HUMAN RESOURCE MANAGEMENT

A. Regular Staffing

1. The budget will fully appropriate theresources needed for authorized regularstaffing and will limit programs to theregular staffing authorized.

regular and temporary employees.

c. All requests for additional regularpositions will include evaluations of:

• The necessity, term and expected

results of the proposed activity.

• Staffing and materials costsincluding salary, benefits,equipment, uniforms, clericalsupport and facilities.

• The ability of private industry toprovide the proposed service.

• Additional revenues or cost savings,which may be realized.

4. Periodically, and before any request foradditional regular positions, programs willbe evaluated to determine if they can beaccomplished with fewer regular employees.(See Productivity Review Policy)


3. The City Administrative Officer (CAO) andDepartment Heads will encourage the use of temporary rather than regular employees tomeet peak workload requirements, fillinterim vacancies, and accomplish tasks

where less than full-time, year-roundstaffing is required.

Under this guideline, temporary employee

minimal training will be required. However,they will always be considered theemployees of the OEA and not the City. Allplacements through an OEA will becoordinated through the Human Resources

Department and subject to the approval of the Human Resources Director.

2. Construction of public works projects and



hours will generally not exceed 50% of aregular, full-time position (1,000 hoursannually). There may be limitedcircumstances where the use of temporaryemployees on an ongoing basis in excess of this target may be appropriate due to uniqueprogramming or staffing requirements.However, any such exceptions must beapproved by the CAO based on the reviewand recommendation of the HumanResources Director.

4. Contract employees are defined as

temporary employees with written contractsapproved by the CAO who may receiveapproved benefits depending on hourlyrequirements and the length of theircontract. Contract employees will generallybe used for medium-term (generally betweensix months and two years) projects,programs or activities requiring specializedor augmented levels of staffing for a specific

delivery of operating, maintenance orspecialized professional services notroutinely performed by City employees.Such services will be provided without closesupervision by City staff, and the requiredmethods, skills and equipment will generallybe determined and provided by thecontractor. Contract awards will be guidedby the City's purchasing policies andprocedures. (See Contracting for ServicesPolicy)

PRODUCTIVITY

Ensuring the “delivery of service with value forcost” is one of the key concepts embodied in theCity's Mission Statement (San Luis Obispo Style—Quality with Vision). To this end, the City willconstantly monitor and review our methods of operation to ensure that services continue to be


F. Periodic formal reviews of operations on asystematic, ongoing basis.

G. Maintaining a decentralized approach inmanaging the City's support service functions.

Although some level of centralization isnecessary for review and control purposes,decentralization supports productivity by:

4. Whenever private sector providers areavailable and can meet established servicelevels, they will be seriously considered asviable service delivery alternatives using theevaluation criteria outlined below.

5. For programs and activities currentlyprovided by City employees, conversions tocontract services will generally be madeth h tt iti i t b ti



1. Encouraging accountability by delegatingresponsibility to the lowest possible level.

2. Stimulating creativity, innovation andindividual initiative.

3. Reducing the administrative costs of operation by eliminating unnecessary reviewprocedures.

4. Improving the organization's ability torespond to changing needs, and identify andimplement cost-saving programs.

5. Assigning responsibility for effectiveoperations and citizen responsiveness to thedepartment.

CONTRACTING FOR SERVICES

A. General Policy Guidelines

through attrition, reassignment or absorptionby the contractor.

B. Evaluation Criteria

Within the general policy guidelines statedabove, the cost-effectiveness of contract servicesin meeting established service levels will bedetermined on a case-by-case basis using thefollowing criteria:

1. Is a sufficient private sector market availableto competitively deliver this service and

assure a reasonable range of alternativeservice providers?

2. Can the contract be effectively andefficiently administered?

3. What are the consequences if the contractorfails to perform, and can the contractreasonably be written to compensate the



Appendix F: Austin TIF EvaluationSystem

Appendix F

Appendix F: Austin TIF Evaluation System

Under the City of Austin’s scoring system, points are assigned to eligible projects based on five

key criteria and weights assigned to each category. The scoring system is used to assess whether

TIF financing will be offered to a project and based on the final score, the potential amount of financing for the project.

Projects with a weighted score of 31 points out of 180 or greater can qualify for up to 50 percent

f th t t l f th ti t d t t l t li bilit 10 P j t ith



of the net present value of the estimated total tax liability over 10 years. Projects with a

weighted score of between 21 - 30 can qualify for up to 30 percent of the net present value of theestimated total tax liability over 10 years. Projects receiving a weighted score of 20 and below

do not qualify for TIF financing. Total City financing cannot exceed 50 percent of the present

value of the estimated total tax liability over 10 years and cannot exceed 80 percent of the totaltax liability in any single year. Austin City Council reserves the right to create a TIF District tofinance public infrastructure in conjunction with a mixed-use project.

The table below represents the scoring system used by city staff to measure each project.

Appendix F

Each category is measured as follows:

A. Overall Economic and Fiscal Impact

What is the absolute size of the net benefit?

o Economic impact as measured by jobs and income

o Level of desirable public benefits included in the project

o Net fiscal impact to the City



Measurements:

o Economic impact analysis (jobs, economic activity)

o Net fiscal impact analysis

B. Public Facilities and Public Benefits

Does the project include new public facilities (parks/public open space, libraries, hike and

bike trails)?

Does the project include programs/services that have a direct public benefit (GreatStreets, support for cultural groups or facilities, support for small or local businesses,

public art, affordable housing).

Measurements:

o Documentation of public facilities, programs or services

o Documentation of project design

C. Neighborhood and Environment

How well does the project transition to residential neighborhoods?

Appendix F

E. Urban Design Considerations

Is there an interconnection of the project components through pedestrian friendlypathways (sidewalks, interior walkways, enclosed corridors and concourses, retail plazas

& mall areas)?

Does the project locate key components around central public spaces (street, park, plaza,

atrium, galleria)? Is the parking underground, structured or in the rear of buildings? If structured, ground

floor must be designed to accommodate active uses.



Do the large single uses occur behind or above habitable street front space? Does the project provide significant physical and functional integration of project

components?

Is there a parking management plan that encourages public transit and alternative forms

of transportation? Does the project preserve historic elements?

Do proposed downtown projects meet the Downtown Design Guidelines?

Does the architecture and landscape respond to the unique character of the site regionalmaterials, landscape, streetscape)?

Does the land designated for shop fronts contain residential and commercial uses?



Appendix G: Best Practices Database



















Appendix H: RecommendationsMatrix

Appendix H

Ini ti ative Short De scripti on FY2011 I mpa ct FY2012 Impa ct FY2013 I mpa ct FY2014 Impa ct FY2015 I mpa ct Tota l I mpa ct Sta tute Cha nge s Re le va nt Sta tute s Note s

TAX POLICY

Expand Sales Tax to

Services

City expansion of sales tax to

select services (laundry,

landscaping, etc.)

- 4,627,562 4,627,562 4,627,562 4,627,562 18,510,248 State Constitution, State Statute, City CodeSTL RCC 5.24.010; RSMo. Section 92.338 ; MOConst.

Article X, Section 22Based on extension to personal and household services

Reduce the Number of

Sales Tax

Exemptions

Removes sales t ax exemption on

motor fuel, textbooks, and

prescription drugs

- 1,907,622 1,907,622 1,907,622 1,907,622 7,630,488 State Constitution, State Statute, City CodeSTL RCC 5.24.010; RSMo. Section 92.338; MOConst.

Article X, Section 22

Based on extension of sales tax to goods currently

exempted

Impose Real Estate

Transfer TaxBased on a 1% rate 7 ,198 ,487 7 ,234 ,479 7 ,306 ,824 7 ,416 ,427 7 ,564 ,755 36,720,972 State S tatute, City Code, Citywide Vote RSMO Sect ion 442 , STL RCC Tit le 5

Based on volume of homes sales to assess ed property

value in comparable cities.

Impose 911 SurchargeWould add 911 surcharge to

cellular and VoIP communication2,123,916 2,177,014 2,231,439 2,287,225 2,344,406 11,164,000 State Vote N/A Contingent upon State voter approval

Junk Food Tax 5% Tax on soda and snack foods - 25,487,792 25,487,792 25,487,792 25,487,792 101 ,951 ,168 State S tatute, City Code, Citywide Vote STL RCC 5 .24, RSMo. Sect ion 92 Contingent upon enabling legislation and would have higher adminstration costs

Extend Cigarette

Occupation Tax to

Retail Sales

$.07/pack tax on retail cigarette

sales- 2 ,628 ,548 2 ,628 ,548 2 ,628 ,548 2 ,628 ,548 10,514,192 State S tatute, City Code, Citywide Vote STL RCC 8 .10.050, RSMo. Sect ion 92

Contingent upon enabling legislation and would have higher

adminstration costs

Alcoholic Beverage

Tax7% Tax on beer, wine, spiri ts - 3 ,661 ,680 3 ,661 ,680 3 ,661 ,680 3 ,661 ,680 14,646,720 State S tatute, City Code, Citywide Vote STL RCC 5 .24, RSMo. Sect ion 92

Subject to Hancock A mendment; may dedicate funding to

health programs

Plastic Bag Tax$.05/plastic bag tax with $.01

1 613 636 1 363 636 900 000 430 469 430 469 4 738 210 State Statute City Code Citywide Vote STL RCC 5 24 RSMo Sect ion92Revenue impact will tail-off as individual's use fewer plastic

Appendix H- Recommendations Matrix



City of St Louis, Missouri Page H-1Comprehensive Revenue Study

Plastic Bag Taxgoing to the merchant

1 ,613 ,636 1 ,363 ,636 900 ,000 430 ,469 430 ,469 4 ,738 ,210 State S tatute, City Code, Citywide Vote STL RCC 5 .24, RSMo. Sect ion 92bags

Increase Restaurant

Gross Receipts TaxIn crea se s t ot al r at e t o 2. 5% 4, 49 2, 00 0 4 ,4 92 ,0 00 4, 49 2, 00 0 4 ,4 92 ,0 00 4 ,4 92 ,0 00 2 2, 46 0, 00 0 C it y Cod e, C it yw id e V ot e S TL RCC 1 1. 42 .2 55 B as ed o n C it y' s c ur re nt e st imat ed res ta uran t t ax b as e

Extend 1.5%

Restaurant Tax to

Take Out

Establishments

Eliminates exemption of take out

establishments from restaurant

tax

4,565,099 4,679,227 4,796,207 4,916,113 5,039,015 23,995,661 State Constitution, State Statute, City Code MOConst. Article X, Section 22, STL RCC 11.42.240

Appendix H

Initiative Short Description FY2011 Impact FY2012 Impact FY2013 Impact FY2014 Impact FY2015 Impact Total Impact Statute Changes Relevant Statutes Notes

TAX POLICY

Extend 2.5%

Restaurant Tax to

Take Out

Establishments

Eliminates exemption of fast food

establishments from restaurant

tax

7,608,499 7,798,711 7,993,679 8,193,521 8,398,359 39,992,769 State Constitution, State Statute, City Code MOConst. Article X, Section 22, STL RCC 11.42.240

Restructure Business

License FeesMove towards a new fee st ruc ture - 38,750 117,800 239, 332 365, 087 760,969 Cit y Code, Ci ty wide Vot e STL RCC 8.06

Change would be revenue neutral, but would allow align

better with economic growth to generate modest additional

revenue in outyears

Raise Existing

Property Tax Millageto the Hancock Cap

Level

Would raise General Purposes

millage to just below Hancock capover a two year period

4,250,000 8 ,627,500 8 ,886,325 9 ,152,915 9 ,427,502 40,344,242 City Code, Citywide Vote STL RCC 5.26 Assumes no further increases a fter two year period

Split Rate LVT Shift to

Generate Additional

$20 million

Restructures property tax to a

split tax rate on land and

improvements at a ratio of 3 to 1.

- - 5,000,000 12,500,000 20,000,000 37,500,000 State Constitution, State Statute, City Code, Citywide VoteMOConst. Arti cle X, Secti on 4B, STL RCC Chapter 5.26

Assumes the City will adopt a split rate property tax

struct ure. In FY2012 the City will move to the new

structure and will generate additional incremental revenue

in FY2013, FY2014, FY2015 to a total of $20 million

annually

Split Rate LVT Shift to Restructures property tax to aMOConst Arti cle X Secti on 4B STL RCCChapter 5 26





City of St Louis, Missouri Page H-2Comprehensive Revenue Study

Generate Additional

$40 million






annually


Generate Additional

$60 million









annually


Generate Additional

$80 million









annually

SUBTOTAL 31, 851, 637 74,724,521 125,037,479 182, 941, 205 276,374, 798 690,929,640

