Voters: Yes to local option sales tax adjustment

Unofficially 53% support

T-R FILE PHOTO Voters at Marshalltown’s Fisher Community Center — Ward 3 — exercise their right to vote. Voters in the ward unofficially supported the local option sales tax re-allocation 208 yes to 181.

Marshalltown voters went to the polls Tuesday and delivered an unofficial “yes” to City Hall on a measure re-allocating local option sales tax spending.

Mayor Jim Lowrance, city councilors and city staff had been promoting passage to voters it would offer more property tax relief and more city flexibility in spending

With four of four precincts reporting, unofficial tallies released by the Marshall County Auditor’s office showed 603 yes and 535 no, a total of 1,138 votes.

The city only needed 50 percent plus one for passage, and had a little room to spare with a unofficial 68 vote difference.

Marshalltown currently applies annual LOST revenue of approximately $3 million to 75 percent property tax relief, 20 percent capital improvements and 5 percent any legal purpose authorized by the council. The city needed Tuesday’s vote in the affirmative changing it 78 percent property tax relief and 22 percent any legal purpose authorized by council.

Should the affirmative vote hold up in an upcoming Marshall County Board of Supervisors canvas, Marshalltown tax payers will see a reduction of .48 per $1,000 taxable value, according to city advertising initiatives.

“That is terrific news,” said Lowrance when told of the unofficial totals.

“Passage will give us some flexibility on several fronts. Importantly, the vote indicates some folks believe the city is on the right track.

Lowrance cited several factors which led to passage.

“City Administrator Jessica Kinser and City Finance Director Diana Steiner’s “Budgeting 101” public information forums — held numerous times to educate voters on the reasons for allocating LOST dollars — were important. Also coverage by local media was helpful.”

Kinser weighed-in on the result too.

“It was the outcome we were hoping for,” she said. “The 53 percent passage does show we have more work to do educating residents on key issues.”

Should the final tally hold, the city will have overcome what some described as “an honest mistake” when Kinser mistaking informed the public that 80 percent, not 78 percent, would be applied to residents’ property tax relief.

Kinser, in an interview with the Times-Republican, took ownership of the mistake, and the city ran several ads in the T-R alerting residents to the correct 78/22 percent split.

“I had it in my mind it was 80 percent,” said Kinser in the interview with the T-R. “The mistake is mine.”

Why change current formula?

More local option sales tax in the general fund means the city will keep services and fees as is. The additional LOST dollars for any lawful purpose would help support services paid for from the general fund, such as fire department, library, parks and recreation and police department services mostly funded by property taxes.

What is local option sales tax?

LOST is a 1 percent tax a majority of Marshalltown voters approved in a 2000 special election. All revenue — an estimated $3 million annually — generated from it goes into the city’s general fund. In transactions where a sales tax is applied, the 1 percent is added to the 6 percent Iowa state sales tax, making the total 7 percent. A number of Central Iowa communities also have a 1 percent LOST.

How much revenue does LOST generate?

2015: $3,126,763

2016: $3,599,309

2017: $4,338,071

2018: $3,400,000 estimate, according to Steiner. The reduction of more than $900,000 is result of absence of Alliant Energy’s Marshalltown Generating Station construction workers. During peak construction this year, hundreds of construction workers were spending thousands of dollars daily in retail purchases, which contributed to 2016 and 2017 revenue spikes.

How will city continue to improve streets and storm sewers?

Marshalltown has been spending more than $2 million on street improvements in recent years and nearly $1 million a year for storm-water projects. Both cost more than LOST is producing, so new payment methods are used.

For more information, contact Steiner via email at, or Kinser via email at, or 641-754-5700.


Contact Mike Donahey at 641-753-6611 or