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St. Louis County Council will again debate freezing property taxes for seniors

County resident Jean Loemcar addresses members of the St. Louis County Council on Tuesday, Aug. 22, 2023, at the Lawrence K. Roos County Government Building. During the meeting, Loemcar spoke in favor of a bill that would freeze property taxes for seniors, but would reduce future funding for schools.
Tristen Rouse
St. Louis Public Radio
St. Louis County resident Jean Loemcar addresses members of the St. Louis County Council in August to speak in favor of a bill that would freeze property taxes for seniors. The council is expected on Tuesday to debate a similar measure that has Republican support. But Democrats on the council say it could reduce future funding for schools.

The St. Louis County Council next week will again debate freezing property taxes for seniors after a similar proposal failed to win the needed five votes in July.

The three Republicans on the council voted for the measure, with the four Democrats voting no.

Councilman Mark Harder, R-Ballwin, who proposed the original bill, said he was surprised the council rejected it.

“I thought that at least one of my Democrat colleagues would have voted for it because I believe it would have helped a lot of people, especially those elderly, that are, in some cases, at the poverty level or just above,” Harder said.

State lawmakers in May passed a bill that allows for counties to freeze property taxes for seniors. To qualify, a property owner would have to be eligible for Social Security.

The St. Charles County Council in September unanimously approved a measure to do so. On Wednesday, the St. Louis Board of Alderman discussed a proposed ordinance that would freeze property taxes for seniors at the amount paid in 2023 for as long as they own and live in their own home.

Democrats on the St. Louis County Council voiced concerns in July that the property tax freeze could negatively impact schools, fire districts and municipalities.

Despite its initial failure, a new version of the tax freeze will be brought up at the next meeting on Tuesday. County Councilman Dennis Hancock, R-Fenton, is proposing the latest version.

He said county lawyers advised council members to not stray from the language passed by the Missouri Legislature so they wouldn’t risk a court challenge.

“We've since found out some of the other counties that have passed it, they have made changes, they've done things like clarify who's eligible to receive it,” Hancock said.

One of the changes in the new version is a sunset clause that would end the property tax freeze in five years.

“It forces the council to look at it again to make sure that we're not harming school districts and fire districts and that everybody has been kept whole or is continuing to do well, despite losing out on some potential revenue,” Hancock said.

But will it be a tough sell for Republicans to gain the vote of at least one of their Democratic colleagues.

Councilwoman Lisa Clancy, D-Maplewood, said while Democrats agree that protecting senior citizens is important, the council needs to do it in a way that doesn’t lessen funding for public entities that depend on property taxes.

“We talked to school districts and we talked to fire departments, libraries, they're really concerned about the impact that this would have on their ability to collect revenue via taxes,” Clancy said. “Yet, a lot of the folks who are pushing this were saying that this isn't actually going to have that big of an impact. So, we need to settle this disagreement.”

Clancy said the changes Hancock has made in this new version haven’t addressed her concerns. She said she wants a means test to qualify who gets the freeze. Clancy also was looking for a broader coalition of support.

“So far, the changes that he has offered in his legislation don't do any of that,” Clancy said. “So it's a bit of a non-starter for me.”

Lawmakers weigh personal property and earnings taxes

As the St. Louis area considers freezing property taxes for seniors, the Missouri legislature is already examining other forms of taxes. The topic is likely to be popular when session resumes in January.

In August, House Speaker Dean Plocher, R-Des Peres, announced that an interim committee would examine the earnings taxes in St. Louis and Kansas City.

Recently, he expanded the scope of a committee to include personal property taxes.

St. Louis imposes a 1% earnings tax on money earned by residents of St. Louis and nonresidents whose work is based in St. Louis.

It makes up around 36% of the city’s general revenue. For fiscal 2023, that amounts to about $219 million.

State Rep. Jim Murphy, who chairs the committee, said the committee will look at several criteria surrounding the earnings tax, including whether there is a better alternative and where that revenue would come from instead.

“You can't just pull this tax out from underneath the city and then expect them to operate. So there has to be other alternatives,” said Murphy, R-St. Louis County.

But Murphy said the committee, which has a Republican majority, also would look at ways to possibly phase the earnings tax out.

“We think that this is an anti-growth tax. Part of the testimony is, ‘Well the businesses like it and so forth.’ Well, actually, if you talk to them individually, they don't like it at all. They think it's just a terrible tax that they have to pay,” Murphy said.

Another committee member, Rep. Steve Butz, D-St. Louis, said that no tax is popular and that if officials take away one of them, it’s going to affect other taxes people pay.

“If you take away the city earnings tax, and you have to replace that much of the city's budget, how would you possibly replace it? The only way in my opinion to replace it is by greatly increasing the sales tax,” Butz said.

Butz said he doesn’t think the committee will make major progress on possible changes to the earnings tax.

“This tax has been under attack for at least 15 years that I'm aware of personally,” Butz said. “So, if there would have been an alternative, that would have been floated and created.”

Sarah Kellogg is a Missouri Statehouse and Politics Reporter for St. Louis Public Radio and other public radio stations across the state.