State lawmakers are keeping a close eye on two eastern Iowa counties as voters in Linn and Johnson Counties soon will decide whether to impose a one-cent sales tax county-wide and use the proceeds to fix up schools. Those are the only two counties in the state where residents haven’t already adopted a one-cent "local option" sales tax on top of the state’s five-cents-on-the-dollar sales tax.
Senator Frank Wood, chairman of the Senate Education Budget Committee, says if voters in those two counties say "yes" on February 12th, state legislators will probably pass a law that eventually would have the state collect that sixth-cent of sales tax and distribute it on a more equitable basis statewide. Wood says the proposed legislation would allow counties to continue to collect the "local option sales tax" for five years, then after that it would go into a "statewide coffer."
Wood, a Democrat from Eldrigde, says it would be fairer to distribute the sales tax money for school "infrastructure" on a per-pupil basis. Under current law, counties like Polk — in the Des Moines area — that collect greater sales tax revenue because they’re a retail center are forced to share some of the money from their local option sales tax with neighboring counties, but not all.
Representative Mike May, a Republican from Spirit Lake, says that has created inequities. "In Dickinson County, my students receive $1100 per year — that’s the highest in the state of Iowa," May says. "On the south end of my (legislative) district, in Spencer, they get $575…That’s certainly not fair to kids."
Iowans for Tax Relief opposes making the local option sales tax permanent statewide for school construction and maintenance. The Iowa Association of School Boards backs the idea, but the Iowa State Education Association — the teachers’ union — will not support a statewide sales tax dedicated to schools unless the money is also used for "general" budget items, like teacher salaries.