On Saturday morning, around 30 people gathered inside one of the library’s meeting rooms to hear a presentation led by Marshalltown Police Chief Mike Tupper and Third Ward City Councilor Greg Nichols detailing what LOST does, which purchases it applies to and how the city has used the revenue it generates. With Nichols, Jeff Schneider and Al Hoop already in the room, fellow Councilor Mark Mitchell waited patiently out in his truck during the discussion to avoid triggering a quorum and a potential open meetings law issue.

If it is not renewed, the tax will sunset on June 30, 2025, but if it is renewed, there is no sunset date established for the future. The city is proposing a modification in the formula of how the revenue is disbursed from the current split of 78 percent debt relief (property tax relief) and 22 percent any council designated use to 75 percent debt relief and 25 percent for any designated use.

Almost immediately, Tupper sought to clear up one major point of confusion. The one percent Local Option Sales Tax is not new as it has existed in Marshalltown since 2000, and it is a separate matter from the proposed franchise fee on gas and electric bills, which failed at the polls by a wide margin back in September. LOST is not assessed on groceries, gasoline, prescriptions, new construction and vehicles.

Tupper also noted that the one percent sales tax is common in Iowa, with over 900 cities utilizing it in some form, and in Marshalltown, it typically generates just north of $4 million per year — with about $3 million going to property tax relief and the remaining $1 million going to council designated uses. He then shared some examples of the council designated uses, including the MPD’s Marshalltown Police and Community Team (MPACT) program and the annual Fourth of July fireworks show at the Central Iowa Fairgrounds.

Third Ward City Councilor Greg Nichols was the other featured speaker during the LOSST discussion at the library on Saturday morning.

Along with specific projects, Tupper said, the council designated uses fund can simply be set aside for emergencies in case an unknown expense were to arise.

“The city has to plan for that as well, and they made that adjustment to allow them to have a little more flexibility with those emergent needs, and also when we have opportunities to apply for a grant to have more funds available to us for (a) local match,” he said.

Before handing the microphone off to Nichols, the chief showed the audience how the ballot language reads and reminded them that the Marshalltown Community School District’s (MCSD’s) Physical Plant and Equipment Levy (PPEL) will also be up for renewal the same day. Early voting is already underway at the Marshall County Auditor/Recorder’s office inside the courthouse. Because it is a special election, there will only be two polling places the day of: voters in Wards 1 and 2 will cast a ballot at the Marshalltown Public Library, and those in Wards 3 and 4 will vote at Redeemer Lutheran Church.

Nichols, who was first elected back in September, attempted to further explain how the tax works in other communities like Ames and Des Moines, which have substantially lower percentages of their dollars going to property tax relief as opposed to community improvement — 50/50 in Des Moines and 60/40 in Ames. The idea is that in cities where people who live either in rural areas or surrounding municipalities shop for their goods, they contribute to the infrastructure and upkeep of a place like Marshalltown.

“They don’t pay our property taxes, but they use our services, our streets, our facilities and our parks,” Nichols said.

Marshalltown residents still pay the lion’s share, he added, but LOST does spread the burden more widely. Nichols estimated that without the tax, the property tax levy would go up by $392 per $100,000 of valuation on a home within city limits, and he also ran down a few of the ways the council designated funds have been used — downtown revitalization, sidewalks, cabinets at the Veterans Memorial Coliseum and the City Centre parking lot, among others.

“There are no trips to the Bahamas. This is all for the city’s benefit, not ours,” Nichols said.

From there, Nichols and Tupper took questions for about a half hour from a number of inquisitive residents on everything from how to vote to other uses of the council designated fund to why there’s no sunset date on the new ballot language. Leigh Bauder asked for more concrete details on how the funds would be used toward economic development, citing a desire for more local retail options.

“To be honest about it, if I want something decent to wear, I’m going to Ames. I’m going to Des Moines. I’m going to Waterloo. I really truly do not want to go shop (at) Walmart,” she said.

Nichols offered to share more information but conceded that with the current situation at the mall, Marshalltown has “a problem” attracting retail. After joking about his wife’s frequent Amazon purchases, Tupper agreed that the city needed more retail but also called for a realistic outlook on the problem.

“We want those things here, but we’re also our own worst enemy in Marshalltown because when I go to Target in Ames, the lot is like 33 percent Marshall County plates,” Tupper said. “If we want those businesses to come here, we have to support them when some do come here, and we have some small businesses now that are trying to sell clothing. We have to support them.”

Another questioner sought clarification on how exactly LOST provides property tax relief, and Nichols and Tupper explained how the $3 million plus going into the fund every year helps to keep the overall levy at its current rate of $16 per $1,000 of valuation. Nichols was asked what would happen if the initiative fails on March 5, and he said it could still be brought back for another vote before the sunset date depending on how overwhelming the consensus was.

Referencing a frequent complaint among city residents — the condition of Marshalltown’s streets — Nichols then noted that it costs about $3 million to resurface one mile of blacktop road, and it can jump even higher if the infrastructure underneath it is rebuilt.

“All this stuff takes a lot of money. We’re not drawing near what it’s gonna take to replace all that stuff with property taxes,” he said.

As the modification in the distribution has been one of the points of contention thus far, Tupper added that most cities in Iowa he has researched have a property tax relief rate closer to 50 or 60 percent in their LOST formulas. The discussion also shifted into how the messaging surrounding the vote could be best distributed, and resident Mark Eaton opined that he didn’t believe the issue necessarily needed to be decided on March 5.

“We basically, as the taxpayers, can negotiate with the council for better percentages, and we can put more to debt relief and to local street repair,” Eaton said. “Most people want local streets repaired, so we can negotiate better percentages if we vote this down. I’m not against the Local Option Sales Tax. It is a consumption tax. All of your points were good. People who come to the city from outside the city help feed that. I want it used better, and I don’t want it up to the discretion of four council members because for five years now, we’ve been running the debt up.”

Marshalltown Area Chamber of Commerce President/CEO John Hall felt that having flexibility was important for the city in light of some of the changes in tax laws at the state level, and Tupper provided the example of new body cameras as a necessary expense the MPD would have to pay sometime in the next year or two. The chief also objected to Eaton’s use of the term “slush fund” to describe the council designated use portion of the tax.

“You can come to council meetings. You can come to council meetings. You can watch how we’re using this money. We’re using it for worthy projects to support our community and help our community grow or enhance services,” Tupper said. “They’re not using it for pet projects. They’re not using it for willy nilly issues. These are important issues, and without LOST, I know the police department probably wouldn’t have some equipment we have today. We wouldn’t have been able to train up our cops and social workers last year to provide the services that we’re providing on a daily basis through our MPACT program.”

Bauder wondered what would happen if the state took over the implementation of LOST as has been suggested and reported in the media, and Nichols responded that while it was hard to know what would happen down the road, the city still needed to stay competitive in any way it could.

“I’m an advocate of this. If you don’t like what your representatives have done, pick new representatives, including me,” Nichols said. “We’re not getting rich out of this job, and it’s taking lots of time. We’re here because we support Marshalltown. Sometimes you don’t like what we’re doing to support Marshalltown, (and) the other council members are open to somebody talking to them.”

City Finance Director Diana Steiner also clarified that the proposed 25 percent for council designated uses could still end up going toward property tax relief and street repair, and Nichols added that the city had a history of kicking in more to property tax relief. Tupper communicated with a friend in Ottumwa, where he formerly worked, to see how much of their LOST goes to property tax relief, and the figure is only 10 percent there.

Eaton asked Steiner why the property tax relief fund still has a balance of around $1 million if the full amount is being paid into it each year, and Steiner said it was used to ensure that the rate didn’t fluctuate too much from year to year.

“We use that to keep property tax fairly steady because we don’t want spikes. We don’t want $19 one year, $10 the next and $20 the next year, so we kind of level it out,” she said.

Nichols encouraged anyone interested in learning more ahead of the vote to reach out to one of the councilors via phone or email, and Tupper reminded residents that city staff works for them and is always available to answer questions.

The city and school district announced that they will be holding a joint PPEL/LOST discussion at the Marshalltown Public Library on Sunday, Feb. 25 from 3 to 4 p.m.

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Contact Robert Maharry at 641-753-6611 ext. 255 or

rmaharry@timesrepublican.com.