The No. 1 complaint the Madison County Treasurer hears is about tax increases. People say, “I didn’t vote for an increase, so why do my taxes keep going up?”
They’re right. The public often doesn’t have a say in the matter. How does it happen? First, let’s make it clear that the county treasurer doesn’t “set” property taxes, but he does send out tax bills and collects the amount owed. Complaints are often made to the treasurer because people want to talk to someone they feel will listen.
Here are examples of tax increases that don’t require voter approval:
Backdoor Referendum — When a taxing entity decides to put a referendum on the ballot, it’s called a "front door” referendum. When they want to avoid voter approval, it's called a “backdoor” referendum. (This method is not legal in Missouri.)
When a board passes a backdoor referendum, the only way the public can vote on the issue is to collect 10 percent of registered voters’ signatures (in the district) on petitions within 30 days.
In October, the Madison County Board passed a backdoor referendum to issue an $18.8 million bond (tax increase) to remodel the jail. More than 300 volunteers gathered 23,600 signatures in the time allotted to force the issue onto the March 18 ballot. Voters rejected the tax increase by 2 to 1.
Most often there is no vote on backdoor referenda. By the time someone spots the legal notice in the newspaper, it’s too late to organize an effort to place it on the ballot.
The result often equals a tax increase and most people are upset because they had no say in the process.
During the past year the Roxana, Bethalto and Edwardsville school boards each passed backdoor referenda approving more than $21 million in bonds.
Levy Increase — A district may increase its levy without voter approval, but if the increase is 5 percent or greater a Truth and Taxation hearing must be held. A notice announcing the meeting is placed in a newspaper, however it often goes unnoticed and no one attends the hearing to ask questions. Once again, taxes may increase.
The Roxana School Board held a hearing in December asking for its levy to be increased. The district requested $29.8 million, up from $21.9 million in 2012, $20.8 million (2011) and $10.7 million (2010).
Home Rule — There are four home rule municipalities in Madison County — Alton, Collinsville, Edwardsville and Granite City.
Corporate authorities of home rule units may impose a sales tax on items being purchased at all retail establishments within its jurisdiction. No voter approval is required for such action.
In March, the Edwardsville City Council passed a .25 percent sales tax despite public pleas that it could hurt small business. Once again, voters didn’t get a say.
Without any voter approval, a home rule community can impose and collect taxes on utilities, hotels, real estate transfers, restaurants (food and beverage,) alcohol, tobacco products and lease receipts.
Once the tax bills go out, people will likely ask “Why are taxes so high? I didn’t vote for that.” The response will be, “You’re right. You probably didn’t have a say in the matter.”
Kurt Prenzler is Madison County Treasurer.