Audrain County, like Mexico, will seek a use tax in a ballot question for county voters in April. The use tax will allow the county to collect its portion of a tax already collected by the state on out-of-state sales, typically online purchases.
The county use tax will match the county sales tax of 1.75%. It will only be collected on online or out-of-state sales, while the county sales tax will apply to local sales. Any future changes to the county's sales tax rate will also change the use tax rate by the same margin. Estimated revenue from the use tax is $152,000.
A decision from the U.S. Supreme Court in 2018 opened up states, counties and municipalities to collect a tax for online sales. Missouri has not yet passed legislation to adopt the decision, but the state already has a law to collect a use tax on online sales, Presiding Commissioner Steve Hobbs said at a Jan. 3 meeting of the Audrain County Farm Bureau.
"Local municipalities and local governments cannot collect that [tax] unless they pass a local option use tax. That statute goes back to the 1940s," Hobbs said.
The county plans to have a use tax question on the ballot for its portion of the tax. The tax will be collected on internet sales or out-of-state sales if they total more than $2,000 per year, Hobbs said. This used to be all done on paper, but now there are computer systems in place to tabulate this, he added.
"The state of Missouri is getting its 4.225% sales tax rate now on everything you buy off Amazon,” Hobbs said. “Those of us that live in the country know that the most dangerous place to be is an Audrain County gravel road at Christmas time with FedEx and UPS trucks howling by.”
Hobbs said he recognizes that buying goods online is about convenience whether or not a consumer is concerned about paying taxes on the products purchased. As online sales increase, without the collection of a use tax, property taxes would have to increase as well.
"The use tax helps level the playing field," Hobbs said, adding the passage of Hancock II in the mid-1990s made it so that if tax collection revenues decrease, property taxes will increase. Since the county is not collecting a use tax on online sales, the county's sales tax revenue has decreased. The county has to remain revenue neutral, per the Missouri state auditor, Hobbs said.
"I would say in the last couple of years we've had some of the best economies around here for awhile. Sales tax should be way up, so property taxes should be down. Guess what? Sales taxes are down," he said.
The use tax is a continuation of what the county already has, Hobbs said. If a use tax isn't implemented, sales taxes will continue to decline in the county and property taxes will continue to increase, he said.
"In April, you're going to have an opportunity to vote yes or no on the use tax. We're here for information. We'll be happy to talk to you. The city of Mexico and the city of Vandalia also will have it on the ballot because we all understand what is happening to our local communities," Hobbs said.
Other county actions
The small structures tax has identified 605 structures in the county — such as bridges, culverts or narrow roads — for upgrades or replacement. Of those, 45 were replaced in the past year. This is on top of the already completed 140 projects since the tax passed.
"Since the first year [in 2017] the citizens of Audrain County have invested over $600,000 in structures that were deficient," Commissioner Tracy Graham said.
He also celebrated the county's work to develop the most up to date election security and cybersecurity for county records. The county has memberships with the U.S. Department of Homeland Security and the Center for Internet Security's multi-state information sharing and analysis center for cybersecurity purposes.
"We've been able to leverage a lot of free services to enhance the security and stability of our network at the courthouse," Graham said.
SSM St. Mary's Hospital–Audrain
University of Missouri Health Care and SSM Health entered into a purchase agreement for its hospitals in Jefferson city and Audrain County in August 2018. That agreement expired Jan. 7 without the sale of either hospital.
County leaders like Hobbs see the agreement between MU and SSM ending as an opportunity. The county and municipalities were not included in negotiations between MU and SSM for the hospital purchase because of how they were structured, he said.
"In Audrain County and in Mexico, we're not very comfortable not being in the loop. This is a community that will dig in and fight for what they believe they want and what they need," Hobbs said.
Since the announced sale in 2018, patronage of the hospital and its services has decreased, Hobbs said.
"Let's tell people that we do want services here and that we're going to patronize it with our feet. That means use the hospital and be part of the solution to keep quality health care here," he said.