County commission laments loss of LAVTR funds

The Jackson County Commissioners are working to spread the word about the loss of state tax funds that should be going to counties and cities throughout the state to help lower property taxes.

Since 2004, all counties and cities in the state have stopped receiving a portion of sales tax dollars collected by the state as part of the Local Ad Valorem Tax Reduction (LAVTR) fund. 

“For last year, the county should have received $604,000 in LAVTR funds,” Commissioner Mark Pruett said. “We could lower the mill levy by four mills if we had that.”

From 2004 to 2022, all local governments in Kansas, including Jackson County and its cities, have lost a combined total of more than $1.7 billion in LAVTR revenues that have been withheld by the Kansas Legislature, according to the Kansas Association of Counties. 

In 2022 alone, a total of $128,300,027 should have been allocated to cities and counties, according to the League of Kansas Municipalities.

LAVTR funding has existed in some form in Kansas since the 1930s, but it was formally set up in 1965. According to state statute, 3.63 percent of state sales and use taxes are supposed to be given to counties and cities to directly lower property tax levies.

LAVTR funding and distribution amounts are set by statute, 65 percent is distributed based on population and 35 percent is distributed based on property tax valuations.

In 2001, state lawmakers began to reduce the LAVTR distributions to local governments and then eliminated the distributions altogether by 2004. Those funds now stay in the state general fund.

During the Kansas Legislative session this year, an amendment to the budget was proposed and passed by the House to fund the LAVTR, but the amendment ultimately failed to move forward in the Senate.

For more on this and other stories, please log in to your holtonrecorder.net account and select “Sept. 27, 2023” under “E-Editions.”