What's on the ballot?
This is the language as it will appear on the ballot: "To authorize imposition of a local sales and services tax in the City of Des Moines, at the rate of one percent (1%) to be effective July 1, 2019. Revenues from the sales and services tax shall be allocated as follows: For the City of Des Moines: Fifty percent (50%) for property tax relief. The specific purpose for which the revenues shall otherwise be expended are: 1. Fifty percent (50%) of such revenues for lawful purposes of the City including, but not limited to, repairing streets, flood prevention, public safety, and improving neighborhoods throughout the City of Des Moines. All expenditures will be subject to regular audit, public comment, and review."
How will this vote impact my property taxes?
If approved, the tax would provide property tax relief as stated in the ballot language above.
Who will pay this new sales tax?
Anyone making a purchase at a retail business in Des Moines would pay the new sales tax. The tax would apply to most retail purchases, but not things such as groceries, gas, and prescription drugs. For a full list of services and products that are taxed, visit the Iowa Department of Revenue.
Does this have to pass in every city or just Des Moines?
It does not have to pass in every city. Last session, the Iowa Legislature eliminated the contiguous cities (cities that share borders) of Polk County requirement and now the City of Des Moines does not have to vote together with other cities as a block. If the vote passes in Des Moines (50 percent of the votes plus one), the tax will be implemented on July 1, 2019.
Do any other communities in Iowa have a Local Option Sales Tax?
Yes, they do. According to the Iowa Department of Revenue 948 out of 971 (97 percent) communities in Iowa have a Local Option Sales Tax. Dallas County passed the Local Option in November of 2017 and is now collecting the additional 1%. This means Polk County residents are already paying Local Option Sales Tax in many communities they may visit across the state - such as Jordan Creek Town Center.
If approved, when would the Local Option Sales Tax be implemented?
It would become effective July 1, 2019.
What businesses would be impacted?
Any Des Moines business that currently collects sales or service tax for the state of Iowa would collect an extra 1% tax that goes to local government. The sales tax would not apply to groceries, prescriptions, gasoline, and utilities.
How would the Local Option Sales Tax help the City's budget?
These funds would help diversify the City’s revenue sources, sharing the load of funding with visitors and all who shop in Des Moines. Various sources have reported that as much as 33% of the new revenue would come from individuals living outside of the city.
How much revenue would be generated?
The City of Des Moines is estimated to receive approximately $37,000,000 annually.
What will Des Moines do with the revenue?
Revenue from the Local Option Sales Tax will help Des Moines lower its tax rate and provide additional funding for projects, including:
- Street Improvements: Revenue would be used to accelerate the five-year street maintenance improvement plan targeting streets like Fleur Drive, Pennsylvania Avenue and East Court Avenue.
- Flood Prevention: Revenue would be used to improve storm water infrastructure to reduce the impact of future flooding.
- Neighborhood Improvements: Revenue would be used for neighborhood projects like the Blitz on Blight; removing blighted properties across the City and improvements to streets, sidewalks and parks.
- Public Safety: Revenue would be used for fire station improvements, modernizing public safety equipment, expanding training, and continued funding of firefighter positions from a federal grant that has expired.
- Property Tax Relief: By state law, 50% of the revenue would be used for property tax relief, including portions dedicated to reducing the need for a future tax increase as well as an immediate reduction to the levy rate.