A new 1-cent sales tax being proposed by Mayor Mike Amyx would push Lawrence’s citywide sales tax rate to the highest in the state.

But one day after Amyx floated the idea at a Lawrence City Commission meeting, several consumers and businesses were approaching it with an open mind Wednesday, in part because Amyx is promising it would produce property tax relief.

“I’ve been telling everybody that downtown is in real trouble right now because of the amount of property taxes that we’re paying,” said Bob Schumm, owner of Buffalo Bob’s Smokehouse and Mass Street Deli, which have seen their property taxes double since 2001. “Any property tax relief would be appreciated. I just hope it is not too little, too late.”

Projections call for the 1-cent sales tax – which would require voter approval and would sunset after 10 years – to raise about $120 million over 10 years. Amyx proposes $60 million be used to repair streets, sidewalks and undertake drainage projects in North Lawrence. The other $60 million would be used to set up a unique city endowment fund that would create interest income for the city to use for infrastructure and other needs. Amyx also is recommending the new money be used by the city to reduce the property tax rate, perhaps by five to six mills.

That was music to some residents’ ears.

Kyle Devore, 3, rides on the back of a fire engine shopping cart while he and his mother, Lark Devore, shop for groceries Wednesday at Hy-Vee, 4000 W. Sixth St. At Tuesday's City Commission meeting, Mayor Mike Amyx suggested a 1-cent sales tax increase for Lawrence. The increase would be used to fund a unique city endowment fund and street repairs.

“As long as they don’t put any more on my house, I’d be fine with it,” said JoAnn Hoover, a Lawrence resident who was at the Douglas County Senior Center. “My house taxes already are too high. This way you’ll at least get the KU students to help pay for everything.”

Support for the sales tax, though, was far from unanimous. Galen Tarman, an owner of Blue Heron furniture store, said he was concerned the higher sales tax would give more incentive for buyers of big-ticket items to shop outside the city.

“I think it is just too much,” Tarman said. “I mean that puts us above what they charge in Overland Park.”

Tarman agreed that property taxes were putting severe strains on downtown businesses, but he said a 5 mill reduction in the property tax rate would do nothing to address the broader problem of rising property values, which cause taxes to go up regardless of what the mill levy does.

Bruce Donaldson, a rural Douglas County resident, said merchants should worry about shoppers going elsewhere.

“I don’t buy where the taxes are high,” Donaldson said. “I keep an eye on that sort of thing for big purchases.”

Some merchants said they didn’t support the proposed tax increase because they weren’t yet convinced the city had done everything to cut expenses.

“I think we probably just need to manage our money better,” said Jim Lewis, an owner of Checkers Foods, 2300 La. “And I don’t like the sales tax because it seems to always hurt the poor person the most.”

The 1 percent increase would push Lawrence’s overall sales tax rate to 8.3 percent. That lags behind only a pair of special taxing districts that have been established in heavy shopping areas of Roeland Park and Olathe. The Roeland Park district charges a rate of 8.65 percent, while the Olathe district – which is along the 119th Street corridor – has an 8.525 percent rate. At 8.3 percent, Lawrence would have the highest citywide sales tax rate in the state, tied with Neodesha.

Tyler Rush, a service department employee at Crown Toyota, works Wednesday to put a shine on a 2006 Chevy Impala for display in the dealership lot. Several car dealers said they weren't too concerned about the tax proposal affecting sales because of how the state charges sales tax.

“I don’t like the sound of those numbers,” said Win Cady, a Lawrence resident who said he wants to support the tax but was wary about the state having a rate above 8 percent.

The city and the county already have 1 percent local sales taxes in addition to the statewide sales tax rate of 5.3 percent. The countywide 1-cent sales tax, approved by voters in 1994, was touted as a funding source for parks, a new health department building, a jail and property tax reduction. A citywide half-cent sales tax was established in 1971, and then an additional half percent was added in 1990 to help fund fire and police budgets. Unlike the tax Amyx is proposing, none of those sales taxes had a sunset provision. Amyx is proposing the new tax automatically end after 10 years, and it only could be renewed if it is put on a ballot and approved again by voters.

In the past, Lawrence auto dealerships have had serious concerns with new sales tax proposals because of fears a higher tax would encourage people to buy vehicles in cities with lower sales taxes. But several dealers on Wednesday said that was less a concern now that the state changed its sales tax law about two years ago.

The changes now require anybody who purchases a vehicle to pay the rate of where they live instead of the rate imposed. Any difference is paid when the car is registered with the county treasurer’s office.

That change left some auto dealers with an open mind about the sales tax proposal.

“I understand the purpose of it,” said John Ellena, an owner of Jack Ellena Honda. “We need to do some work on infrastructure. And the trade-off would be that we reduce the mill levy. That’s good because property taxes are a big deal for businesses.”