May 30, 2012 at 9:07 AM CDT - Updated June 27 at 5:33 AM
KENNETT, MO (KAIT) - The Kennett City Council approved two ordinances for taxes to replace several fees collected by the city.
The ordinances detail a one percent sales tax and a one-half of one percent capital improvement tax that will replace the Kennett property tax, merchant license fees, city automobile stickers and building permit fees.
"I think it would be wonderful," said Holly Dollins, owner of Dollins clothing store in Kennett.
"We've been in business here for about 42 years."
Kennett residents could approve the tax ordinances by vote on August 7 in the Missouri primary elections.
"Current tax policy right now is that we're going to charge you to build a building to invest in Kennett with a building permit fee. We're going to charge you a merchant license. On top of that, we're going to charge that business to stay in Kennett on their invested property," said Mayor Crafton.
If residents approve the ordinances, Kennett mayor Jake Crafton estimates the city will generate about $2 million in 2013, the year the ordinances would go into effect.
Mayor Crafton said the $2 million would replace the $900,000 a year the city collects from the current fees, most of which Mayor Crafton said comes from property and business owners.
"Property tax brings in $750,000, and this is round numbers, business license brings in around $60,000, building permit fees around $30,000, city stickers, which is automotive stickers, $60,000," he said. "The sales tax will take the burden off the property owners and businesses for funding our city and place it among the general population."
Mayor Crafton plans to designate the funds for repairing roads, and paving the 12 miles of gravel roads within the city limits.
"Our streets needs (sic) work. A lot of the town needs work," Dollins said.
Mayor Crafton said the money will also be used to build the city's reserve fund.
"Currently our city has very little reserves, and any person, whether you're an individual or business, you've got to have some sort of reserve to fall back on in case of emergencies or just bad times."
Dollins believes the tax is a possible win for Kennett.
"I think if it's everything the mayor and the council says (sic) it is, the city should go for it because I think it would be a good deal for the city."
Kennett residents will vote on the ordinance August 7.