5 Metro Cities to Vote August 6
On August 6, 2019, voters in five Polk County cities will have an opportunity to vote on whether or not to impose a one-cent local option sales tax (LOSST) on retail sales in their communities. The five cities are Bondurant, Clive, Grimes, Johnston and Urbandale. The rate would go up from six percent to seven percent.
These five cities follow the six that voted in the tax in March 2019: Alleman, Altoona, Des Moines, Pleasant Hill, West Des Moines and Windsor Heights.
If voters in the five cities approve the measure in August, Ankeny will become the lone Polk County community of size in which the tax is not imposed. Elsewhere in Iowa, a countywide LOSST is in effect everywhere but in Johnson county.
Now that the tax is already in effect in the larger retail centers in Polk county, the argument for imposing LOSST in the next five communities is different. Because the metro is one large market, it can be argued that people living in suburbs like Clive, Urbandale and Johnston are paying the tax when they make purchases in neighboring communities or on-line, but they are not receiving any of the proceeds back. The taxes they pay are instead going to their neighbors.
The situation is a bit like dominoes. Once the larger retail centers impose the tax, the smaller communities fall in.
Several of the five communities – Clive, Urbandale and Grimes -- already pay the extra penny since Dallas County approved a similar measure in 2017.
Ankeny is an interesting exception. Iowa State University retail trade analysis reveals that Ankeny has relatively low sales per capita compared with its peer group of cities, and it tends to underperform its peers in terms of the extent to which it “pulls” in sales from outside the community.* It may be that Ankeny views itself as somewhat more self-contained than other cities in Polk County, which is reinforced by its boundaries touching no contiguous city.
What are the five communities’ plans for using the proceeds of LOSST, if it passes?
The law requires the ballot to specify the approximate amount that will be spent for property tax relief, if any, and the purposes for which it will be spent if other than property tax relief.
All cities will promise at least 50 percent for property tax relief on the ballot, however the definition of what is meant by “property tax relief” varies by community.
Property tax rate information is expressed in terms of dollars per thousand of taxable value.