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Tax Q and A with the City of Excelsior Springs

March 9, 2018 – Taxes, their purposes, the amount generated, and what they are spent on are common questions asked by citizens of any city. Steve Marriott, Director of Administrative Services for the City of Excelsior Springs, recently answered some of the questions commonly asked by residents, in an ongoing effort to let citizens know what’s happening in the city.

Q: Is there a cigarette tax?
There is still a cigarette tax in place. It is $0.10 for a pack of 20 cigarettes and $0.125 for a pack of 25 cigarettes. I believe this rate has been the same since approximately 1987.
Q: How much revenue was generated from the cigarette tax over the most recent fiscal year?
During fiscal year 2017 (October 1, 2016 through September 30, 2017) we collected $112,152.61.
Q: What were those funds used for?
A: The funds are deposited into the General Fund and the Parks and Recreation Fund. Their use is not restricted, so they can be used for anything that is funded from those two Funds. As the monies are not restricted, we do not track specific things they were used for.
Q: What are restricted funds? Why are some funds earmarked for specific items, and why can’t those funds be used in other ways? For example, why were funds used to purchase a new ambulance instead of hiring a new EMT / Paramedic?
A: Our revenues often have restrictions as to how they can be used. Monies are generally restricted by the legislation that creates the revenue. For example, according to Missouri law Capital Improvements Sales Tax monies can only be used for the creation and maintenance of capital assets. Thus, these monies cannot be used for salaries, benefits, etc. In contrast, the Community Center Sales Tax can be used to support the operation of the Community Center. The difference between the two taxes is the way that the state statute (and ballot language) was written.

As a general rule, monies that are restricted are deposited into specific funds with other monies that have the same restrictions so that we can control their use. That is why the City has so many different funds in our budget and financial statements. Transferring monies from one fund to another to accomplish something that was not specifically allowed in the original fund would be a violation of the public trust. We as public employees are bound by the language that was in the original legislation and the language on the ballot.

Revenues flowing into the General Fund are not generally restricted as to their use, so it is possible that the monies used to purchase the ambulance could have been used to hire another EMT/Paramedic; however, these monies were budgeted for the purpose of replacing the ambulance. The ambulance being replaced is a 2010 model with 159,000 miles and 7,100 engine hours on it. As this ambulance is used to transport our residents in emergency situations, we have to make sure that we have a dependable vehicle. I can think of nothing worse than breaking down while hauling a patient to the hospital.

Featured image by Courtney Cole

By Samantha Kilgore •

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