A presentation from the City of Pella to the Marion County Board of Supervisors is the agenda Tuesday for a proposed Local Option Sales and Service Tax redistribution agreement.

In one of the few such agreements in Iowa, Marion County agreed to redistribute revenue from the tax to better reflect the sales generated by Pella and Knoxville. The current agreement expires on December 31st, 2023 and was first approved in 2011. The reason why the arrangement was developed was that the formula for LOSST is based on population and assessed value from the years 1984 through 1986.

The City of Pella is requesting an adjustment based on the 20-year extension approved by Pella voters in 2022 and on the latest revenue numbers available from LOSST, which was framed in similar fashion in 2011. The Pella City Council is asking for a two year extension of the current formula, with escalation from 8% to 10% in the third and fourth years, and 12% for the remainder of the term. The language in the proposal would allow all parties to renegotiate if the Iowa Legislature makes changes to the LOSST tax formula in the state. Based on fiscal year 2022, Pella generates 64% of LOSST in Marion County and Knoxville generates 28%.

In total, if the Marion County Board of Supervisors agrees to the proposal, it would cost the county $200,000 annually once the full 12% would become effective in FY 2028. The City of Knoxville recently presented, and aim to maintain their current arrangement for the length of their LOSST extension.

Click here to view the presentation planned by the City of Pella. The Marion County Board of Supervisors meets Tuesday at 9 a.m. at 3014 E Main Street in Knoxville.