“font-family: Verdana; font-size: 13px;”>The census data released at the end of February provided a bitter pill for anyone concerned with our city’s future. The exodus of almost 30,000 residents from St. Louis over the past 10 years continued our staggering population decline into its sixth consecutive decade.
“font-size: 10.0pt; font-family: Verdana;”>In response, elected officials, concerned citizens and the media have renewed their calls for a substantial “rethinking” of regional government – like merging St. Louis city and county. On April 5, however, local voters will take on an issue just as important to the long-term health of our city when they consider whether to continue the city earning tax with Proposition E.
“font-size: 10.0pt; font-family: Verdana;”>Every year, the earnings tax provides about $141 million in St. Louis. That’s roughly one-third of our city’s annual revenue. It helps pay for many of our most essential services, like picking up trash and public safety.
“font-size: 10.0pt; font-family: Verdana;”>But if voters fail to approve Prop E, the city will no longer collect those funds – forcing us to find new ways to pay for these services or lose them entirely. And it’s not just city programs that would disappear. The cutbacks in services and quality of life would make St. Louis less attractive to businesses and individuals. That means countless numbers of the city’s companies and residents would leave the area, taking tax dollars with them.
“font-size: 10.0pt; font-family: Verdana;”>Our city just experienced a substantial population drop after 10 years of relatively significant investment and effort focused on revitalizing our city. Imagine how far St. Louis’ population might fall by 2020 if we’re forced to slash basic services.
“font-size: 10.0pt; font-family: Verdana;”>When the State Auditor’s Office examined the earnings tax last year, it estimated that eliminating it could reduce the city’s businesses and population by 10 percent. Such a decline would cost St. Louis another $31 million in tax revenues and, combined with the lost earnings tax, would decrease the city’s general budget by 47 percent. According to the report, these diminished revenues would eliminate more than 2,000 city jobs and “be so disastrous that they would result in the City’s ruin.”
“font-size: 10.0pt; font-family: Verdana;”>You can envision how life in St. Louis would change if we lost half the city’s budget. We’d have trash pickup every 14 days, instead of once a week. We’d have our streets cleaned half as often as we do now. And we’d have half as many police and emergency personnel in a city already plagued by high levels of crime and violence.
“font-size: 10.0pt; font-family: Verdana;”>Eliminating the earnings tax would be a giant step back at a time we’re desperately trying to move forward. Just being required to reauthorize it every five years costs St. Louis funds that would be better spent elsewhere. Because uncertain revenue streams make lenders uneasy about risking their funds, it’ll be more expensive for our city to get the loans it needs and any bonds we issue will be worth less than they otherwise would.
“font-size: 10.0pt; font-family: Verdana;”>Later this month, Kansas City plans to issue $55.3 million in general-obligation bonds to pay for capital improvements and refinance existing debt. However, in February, a bond rating service lowered Kansas City’s rating one-notch to AA. In a memo to its investors, the ratings service cited the risk posed by holding earnings tax referendums every five years as the sole reason for the downgrade. Over the next 25 years, this drop will cost the city about $400,000 in their new bonds’ value.
“font-size: 10.0pt; font-family: Verdana;”>Such damages will almost surely come St. Louis’ way, too, in the near future. And, if voters fail to pass Prop E, this doubt and insecurity will handcuff our city even further for years to come.
“font-size: 10.0pt; font-family: Verdana;”>By passing Prop E, we’ll send a loud and clear message that we want to move St. Louis forward, not backward. And a large margin of victory will let bond raters, civic leaders and “retired financiers” know that our city’s most important source of funding is safe for years to come.
“font-size: 10.0pt; font-family: Verdana;”>So, join me and countless others committed to our city’s future by visiting the CitizensforAStrongerStLouis.com and adding your name to the list of citizen supporters. Spread the word and tell your friends and neighbors why Prop E is so vital to keeping our city going. Most importantly, remember to get out there and vote YES ON PROP E on April 5.
