JEFFERSON CITY, Mo. (AP) – The Missouri Supreme Court rejected a legal challenge Tuesday to a voter-approved law requiring local elections to decide whether to keep municipal earnings taxes in St. Louis and Kansas City.
Missouri voters in 2010 approved a statewide ballot measure that forced the state’s two largest cities to hold elections on their earnings taxes, with subsequent public votes every five years. The measure also barred other communities from enacting their own city tax on local earnings and profits.
The Kansas City manager and a local labor leader filed a lawsuit in their individual capacities challenging the voter-approved law. They argued it wrongly changed Kansas City’s charter and violated the state constitution by requiring local elections without paying for them.
A unanimous high court rejected those claims and upheld a trial court’s prior ruling against the legal challenge.
Supreme Court Judge George W. Draper III wrote in the high court’s opinion that the voter-approved earnings tax law does not change Kansas City’s charter and that any city costs for holding an election are a result of its own decision.
“If Kansas City seeks continued authorization to impose an earnings tax, it now must seek the approval of its own qualified voters,” Draper wrote. “Whether Kansas City seeks continued authorization to impose an earnings tax is purely discretionary. There is no mandate requiring an election.”
A lawyer from the Kansas City attorney’s office did not return a telephone message Tuesday seeking comment about the ruling.
Travis Brown, president of Let Voters Decide, which sponsored the 2010 initiative, said Kansas City officials should have been focused on making future fundamental changes to Missouri’s tax laws to keep it competitive with Kansas instead of challenging a law already approved by voters. He praised the Supreme Court’s decision.
“It’s a great day on America’s birthday that we honor voters’ rights to change their own laws in the state of Missouri,” Brown said.
After the 2010 statewide ballot measure was approved, residents in Kansas City and St. Louis voted overwhelmingly to keep their 1 percent earnings taxes during elections held in April 2011. Additional elections would be required in 2016 to continue the tax.
The tax has accounted for $140 million, or about one-third, of the St. Louis budget, and $200 million, about two-fifths, of Kansas City’s.
The group Let Voters Decide has said the earnings taxes encourage people and businesses to locate in suburbs without such taxes, and that the cities should eliminate their extra layer of income tax.
Case is Dujakovich vs. Carnahan, SC92062
Associated Press writer David A. Lieb contributed to this report.
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