Local Option Sales & Service Tax
In March 2019, 70 percent of voters in Des Moines approved a one-cent Local Option Sales & Service Tax to be used for property tax relief, infrastructure upgrades, public safety enhancements and neighborhood improvements.
The new tax went into effect on Monday, July 1, 2019. The tax does not apply to things such as groceries, gas or prescription drugs, as determined by the Iowa Department of Revenue.
An estimated 33 percent of revenue will be generated by visitors. Each year, the City will publish a Local Option audit report for public review.
Des Moines City Council's Local Option expenditure policy includes:
- PROPERTY TAX RELIEF — By state law, 50 percent of the new sales tax revenue must go toward property tax relief. After receiving approval from voters, Des Moines City Council reduced the City’s property tax levy rate to the lowest it has been in the past seven years.
- STREET IMPROVEMENTS & FLOOD PREVENTION — Visitors and commuters will now help fund necessary improvements to Des Moines’ important infrastructure, including street repavement/replacement and storm sewer upgrades.
- NEIGHBORHOOD IMPROVEMENTS — The City is committed to using Local Option revenue to invest in neighborhoods throughout Des Moines, including removal of blighted houses and expanded library hours.
- PUBLIC SAFETY IMPROVEMENTS & EXPENDITURES — To better serve our quickly growing city, Local Option revenue will be used to fund public safety enhancements, including continued funding for 13 firefighter positions and mobile mental health crisis services for youth.
The City of Des Moines is committed to pursuing public projects, services and initiatives that will provide the most benefit to residents, businesses and community organizations. Following the March vote, City Manager Scott Sanders explained that voters voiced their priorities loud and clear.
“With the approval of Local Option, Des Moines voters demonstrated overwhelming support for our city and its neighborhoods,” Sanders said. “They also delivered a clear mandate to all of us who serve this City and its residents, and we look forward to delivering on our promise to use these funds responsibly and in a transparent manner.”