COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:1978S.01I Bill No.:SB 546 Subject:Taxation and Revenue - Income; Kansas City; Saint Louis City Type:Original Date:January 28, 2025Bill Summary:This proposal modifies provisions relating to earnings tax.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on General
Revenue $0$0$0
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 1978S.01I
Bill No. SB 546
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on FTE 000
☐ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028
Local Government*
More or Less than
$650,000$0$0
*Potential election cost savings for Kansas City going from a 5 year election ballot to a 10 year
election ballot for the earnings tax. L.R. No. 1978S.01I
Bill No. SB 546
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FISCAL ANALYSIS
ASSUMPTION
§§92.105, 92.111 & 92.115 – Earnings Tax
Officials from the City of Kansas City assume this proposal would have a positive fiscal impact
on Kansas City in an indeterminate amount.
Oversight notes this proposal would allow Kansas City the certainty of knowing that it can
maintain its earnings tax for 10 years instead of 5 years after a vote of approval and would save
Kansas City money by not having to pay for an election every 5 years.
In response to similar legislation from 2023, SB 344, officials from the City of Kansas City
Board of Elections state a cost of $650,000 to conduct an election in the Kansas City portion of
Jackson County. Currently this question is put on a ballot every five years. If this question is
moved to every ten years, it could potentially save $650,000, plus inflation, every ten years.
Oversight notes according to the Communications Office for the City of Kansas City,
approximately $292.2 million is generated by the earnings tax for the City of Kansas City each
year. This is 45% of the City’s General Fund revenue. Of the General Fund, 73% pays for public
safety needs, such as police officers, firefighters, ambulance services and Municipal Court
operations. Nonresidents make up 50% of the earnings tax paid. The following is an Earnings
Tax Rate Comparison by various cities in the United States compared to the State of Missouri:
Oversight assumes his proposal, if passed, would make the next election for the renewal of the
earnings tax for Kansas City for April 2031 instead of April 2026 (FY 2026). Therefore, if this
proposal does pass, Oversight will reflect a savings to Kansas City in FY 2026 for this proposal
for not holding this election.
C
ity
E
arnings Tax Rate
C
ity
E
arnings Tax Rate
P
hiladelphia, PA*
3
.8712/3.5019%
P
ortland, OR
2
.20%
P
ittsburg, PA*
3
.00/1.00%
C
leveland, OH
2
.00%
D
etroit, MI*
2
.4/1.2%
I
ndianapolis, IN*
1
.77/.4425%
L
exington, KY
2
.25%
S
t. Louis, MO
1
.00%
L
ouisville, KY*
2
.20/1.45%
K
ansas City, MO
1
.00%
*
Cities with different rates for residents and non-residents.
E
ARNINGS TAX RATE COMPARISON L.R. No. 1978S.01I
Bill No. SB 546
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Officials from the Office of Administration - Budget and Planning state this proposal does not
impact total state revenue (TSR) or Article X, Section 18(e).
Officials from the Department of Labor and Industrial Relations, the Department of
Revenue and the Office of the Secretary of State each assume the proposal will have no fiscal
impact on their respective organizations. Oversight does not have any information to the
contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for these agencies.
FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028$0$0$0FISCAL IMPACT – Local GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028CITY OF KANSAS CITYSavings - §§92.105, 92.111 & 92.115 –
election costs for earnings tax ballot
approval – switched from every 5 years
to every 10 years
More or less
than $650,000$0$0
ESTIMATED NET EFFECT ON
KANSAS CITY FUNDS
More or less
than $650,000$0$0
FISCAL IMPACT – Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
FISCAL DESCRIPTION
Current law requires the earnings tax imposed in the City of St. Louis and Kansas City to be
submitted to the voters for renewal every five years. This act requires such submission to voters
in Kansas City to occur every ten years.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space. L.R. No. 1978S.01I
Bill No. SB 546
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SOURCES OF INFORMATION
City of Kansas City
City of Kansas City Board of Elections
Office of the Secretary of State
Office of Administration
Budget and Planning
Department of Labor and Industrial Relations
Department of Revenue
Julie MorffJessica HarrisDirectorAssistant DirectorJanuary 28, 2025January 28, 2025