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City sues governor over veto
St. Joseph could be forced to roll back property tax
Originally published August 6, 2009 at midnight, updated August 6, 2009 at 6:45 p.m.
The city of St. Joseph has filed suit against Gov. Jay Nixon over an "incomprehensibly unfair" veto that would force the city to lower its voter-approved property tax.
House Bill 148, which the legislature passed this year, would have negated language in a 2007 Senate bill that, if implemented, would force the city to lower its tax levy ceiling from 70 cents to 67 cents per $100 of assessed value.
The governor vetoed HB 148, which means the Senate bill could go into effect and cost St. Joseph more than $300,000 a year in lost revenue to its general fund.
The city hopes the lawsuit, filed Tuesday, accomplishes one of two things: either the governor rescinds his veto, or a judge rules the Senate bill unconstitutional.
City Manager Vince Capell wrote a letter Friday asking local legislators for help. He told them more than 80 percent of the funds in question paid for police, fire and municipal court services.
"This significant rollback of St. Joseph's general fund property tax levy and the associated loss of operating revenue are incomprehensibly unfair with respect to our residents and unduly reckless with respect to community safety," Mr. Capell wrote.
Mr. Nixon justified his veto with a statement that HB 148 would have allowed a large number of tax districts to raise property taxes without voter approval.
In a separate letter sent to the governor's office Friday, Mr. Capell challenged Mr. Nixon to cite a single example of such a district. The city manager told the governor he initially gave him the benefit of the doubt, thinking he did not realize the effect the bill had on St. Joseph. That changed after a conference call with representatives from the governor's office and the Missouri State Tax Commission. Mr. Capell said he was told that "only" 40 tax jurisdictions in the state were affected, an acceptable amount of "collateral damage."
Four state and county officials join the governor as defendants in the case in Cole County Court: Attorney General Chris Koster, State Auditor Susan Montee, Buchanan County Prosecutor Dwight Scroggins and Buchanan County Clerk Pat Conway.
Mr. Conway described the case as a "friendly lawsuit."
"If they don't include me in the lawsuit and I continue doing my job, there would be no other way for the city to recoup its lost funds," Mr. Conway said.
Legislators will convene for a veto session Sept. 16. The city filed suit prior to the session because property tax levies must be submitted to the state auditor by Sept. 1.
A spokesman for Mr. Nixon said the governor was unaware of the lawsuit and had not seen the letter from Mr. Capell.
The city has not asked for a property tax increase since 1993.
To view the lawsuit for yourself, click here.
Clinton Thomas can be reached at clintonthomas@npgco.com. Rob Schmidt of St. Joe Now contributed to this report.
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taxedout says...
I wonder how much this law suit is going to cost to try to recover the $300K? Darn that Governor trying to save me money anyway. How about some honest reassessments on property values. The assessor bills it as " doing the taxpayers a favor" by freezing assessments, when in fact home values have declined in the last couple of years, not stayed the same.
August 6, 2009 at 8:21 a.m. ( permalink | suggest removal )
TDubb says...
How about a grandfather clause saying basically "from this point forward?"
August 6, 2009 at 11:02 a.m. ( permalink | suggest removal )
apmastrangelo says...
The primary argument of the city becomes interesting based on the following claim:
NP 8/6 - "City Manager Vince Capell wrote a letter Friday asking local legislators for help. He told them more than 80 percent of the funds in question paid for police, fire and municipal court services."
Adopted city budget FY '08-'09 appears to have a total "operating" ratio of about 84%. The breakdown for the the referenced expenditures for the three categories seems to provide a much different percentage total of the budget (3-10).
Please do not misunderstand; the loss of the revenues in question would not be good for the city and mean even greater budget tightening during an already difficult time. Legal attempts in fighting this matter alone with budget statistics that can be challenged as not an accurate portrayal could be counterproductive to the cause as the argument might then be made that a greater percentage of the loss funds can be absorbed in other areas as a wider range for cuts exist.
Unless many details of the city's case are missing from this article a rethinking on the approach in fighting this matter may be needed and helpful in bringing about the outcome desired by the city.
August 6, 2009 at 11:22 a.m. ( permalink | suggest removal )
ClintonThomas says...
apmastrangelo,
So you know, the budget you referenced is a year old. The FY 2009-10 budget is available online at http://www.stjoemo.info/fin/FY10Budge... if you or anyone else wants current numbers.
Yesterday's story hit fairly close to my deadline. After reading your comment, I went back and crunched some numbers.
According to the current budget, police/fire/municipal court account for roughly 71 percent of the general fund (3-10, 3-11; or pg. 59-60 of the pdf file). The city manager's letter said it was more than 80 percent, so there seems to be a bit of a discrepancy.
(Police - $13,339,231) + (Fire - $10,658,430) + (Municipal Court - $478,645) = $24,476,306.
$24,476,306 / (GENERAL FUND $34,379,923) = .7119.
You referenced a "much different percentage" for the total of the budget. You're right that police/fire/court do not account for 80 percent of the total budget. It's much lower (18.7 percent). Correct me if I misinterpret your point here, but it looks to me that you're saying Mr. Capell is of by 50 percent or more.
This lawsuit concerns a tax that contributes solely to the general fund. It's misleading to use the percentage police/fire/court account for in the total budget, because that's not the number Mr. Capell referenced. Bringing up a much smaller number doesn't prove the city wrong. It simply shows that one side views this from a wide perspective (% of total budget) and the other from a narrow one (% of general fund).
I'm not saying Mr. Capell's numbers are correct. Just that they aren't as wrong as I think you think they are. As I said above, correct me if I'm misunderstanding your point.
Unless my math is off, it looks like 71 percent of the $300,000 would pay for the services Mr. Capell mentioned, not "more than 80 percent". I would say his statement is off by 9 percent. If you think he's off by more than that, let me know.
Clinton Thomas
St. Joseph News-Press
August 6, 2009 at 12:31 p.m. ( permalink | suggest removal )
apmastrangelo says...
Hello Clinton:
Yes I think you have missed my point. First off, I agree with the city taking exception in this matter and see it as yet another bump in the road not needed.
What I was attempting to say is that, in my opinion, if the city wishes to succeed in this quest the numbers argument alone, no matter how crunched, will probably not provide the legal basis needed. If their case is is based on other legal precedence that would be good to know. While it is important, I think how the city might deal with the impact of such a loss will not be sufficient to change the minds of those making a decision on the subject.
August 6, 2009 at 1:10 p.m. ( permalink | suggest removal )
ClintonThomas says...
We're on the same page now. If nothing else, my explanation gave you a link to the new budget. Feel free to shoot me an email if you ever have questions about a story I write, or city issues in general.
Clinton Thomas
St. Joseph News-Press
August 6, 2009 at 2:10 p.m. ( permalink | suggest removal )