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Market Profile: Kansas Grocers Still Seeking To Defeat High Food Sales Tax

McKeever’s Market & Eatery Grand Opening
Alan McKeever, Aaron McKeever and Gary McKeever are pictured with company founder John McKeever.

by Terrie Ellerbee/editor-Midwest

Jon McCormick, Retail Grocers Association of Greater Kansas City
Jon McCormick, Retail Grocers Association of Greater Kansas City

Jon McCormick told the state House taxation committee in February that the Kansas Food Dealers Association (KFDA) has lost 150 stores in the last 20 years. He then gave a short list of reasons why that happened that included the usual suspects, like competition from Walmart, dollar stores and Aldi, but— perhaps more importantly—he pointed to the food sales taxes in surrounding states. In Missouri, it is 4.25 percent. Oklahoma’s food sales tax is 1.45 percent. There is no such tax in Colorado and Nebraska.

But the tax on food is 6.5 percent in Kansas, and that ranks  among the highest in the U.S.

“I am in favor of lowering the tax on food,” McCormick said in his testimony. “I am in favor of matching and beating the competition hovering around our borders. I have the goal to take it to zero.”

In March, Gov. Laura Kelly, a Democrat, quashed reducing the food sales tax when she vetoed a larger tax relief package passed by Republican state lawmakers, who control both the House and Senate.

McCormick, who also helms the Retail Grocers Association of Greater Kansas City, told The Shelby Report that some lawmakers are “talking out of two sides of their mouths. They’re going to give Aldi a tif (tax increment financing that subsidizes companies by refunding or diverting a portion of taxes to help finance development). It is an international company,” he said. “But there is a store on the other side of town that goes out, and then they say, ‘well, there’s a food desert, and we’ve got to help that area, too.’”

He said having both the competition and the government working against the independent grocer is like “death by a thousand cuts.

“If he goes out of business and then a dollar store, which doesn’t have a meat cutter or a produce department or small deli, comes in, it changes the dynamics of the city,” McCormick said. “People have to drive 30 miles to the next city that might have a supermarket. That’s been the plight of rural Kansas retailers.”

A second GOP tax plan introduced in May would have offered some of the tax relief contained in the original bill, including the food sales tax reduction.

Kelly vetoed that one, too.

Meanwhile, in Missouri

McCormick’s office is located in Kansas City, right smack in the middle between Kansas and Missouri. He has members in St. Joseph on the western side of Missouri, eastward to Columbia and back around to Springfield in southwest Missouri.

He talked a bit about Missouri politics, including last year’s rejection of a right-to-work measure that had been passed by the legislature. Having a right-to-work law would mean unions cannot require employees to pay union dues, whether they want to be part of a union or not.

The question of whether to actually implement right-to-work, however, was on the ballot last August—thanks to the influence of unions. NPR reported that organized labor groups and their allies spent $15.5 million to fight right-to-work in Missouri. The state’s voters then rejected it by a wide margin.

All of this was happening just weeks after the U.S. Supreme Court ruled that public sector employees cannot be compelled to pay fees to unions. Missouri’s law would have extended that provision to all private employers as well.

McCormick said that since voters rejected right-to-work, things have been lackluster in Missouri, politically speaking. With last year’s election in November, newly elected officials have been settling into their roles in Jefferson City.

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McKeever’s Market & Eatery Holds Grand Opening

The parking lot was completely full by 9 a.m. as locals came to check out the new McKeever’s Market & Eatery in Lenexa, Kansas on June 12. Retail Grocers Association of Greater Kansas City President and CEO Jon McCormick called the store opening the “biggest news in Kansas.” (He took the photographs shared here and below.) It is a store loaded with surprises, including a pineapple-coring machine that gets the job done in 20 seconds. McCormick joked that McKeever’s may become the “pineapple capital of Kansas.” The new store also is illustrative of a law in the state that became effective April 1. Kansas grocery retailers now are allowed to sell full-strength beer. That means that McKeever’s Market & Eatery can offer its shoppers craft beer brewed right in the state or next door in Missouri.

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Missouri Grocers Will Gather At Margaritaville In October

Dan Shaul, Missouri Grocers Association

Dan Shaul is executive state director of the Missouri Grocers Association (MGA) and, since 2014, also a representative in the Missouri House.

Shaul told The Shelby Report that the 2019 Missouri General Assembly’s session moved along at a “measured pace” partly because 2018 was an election year, and it takes time for new members and old ones alike to get comfortable with each other.

In addition, Mike Parson just marked his first full year of service as governor, though the election for that office was held in 2016. He became governor in June 2018 after former Gov. Eric Greitens resigned.

That is worth noting here because of Parson’s support for Buy Missouri, an economic development initiative created when Parson was lieutenant governor to promote products grown, manufactured, processed and otherwise made in the state.

Parson will be among the attendees (and an honoree) at this year’s MGA Convention. It has the theme “Fall Back Into Success” and will be held Oct. 16-18 at Margaritaville Lake Resort (formerly Tan-Tar-A Resort) in Lake of the Ozarks. One of the events will be a “Buy Mo! Open” golf tournament.

The convention had been held in the summer months in recent years, but out of respect for members’ family time, it has been moved back to the fall.

“We’d had it in October years ago,” Shaul said. “Now, not only have we moved it to October, but we’ve moved it to a Wednesday/Thursday/Friday (morning) event so they can be home with their families that weekend.”

The agenda has been finalized, with business sessions that include timely topics like CBD oil sales and responding to a crisis or emergency.

“With CBD products, is it truly legal to sell? Is it not? There are so many questions about it. We’re going talk about that,” Shaul said.

The preparedness session will include information around what to do during and after events such as severe weather, a fire or an active shooter. This is very timely because two tornadoes hit Missouri in May. One was in Jefferson City, the state’s capital. The other was in the Carl Junction area and Golden City, where Ozarks First reports three people were killed. Shaul said two independent grocery stores were damaged.

“We’re going to talk about disaster preparedness. What do you do in case of emergencies?” Shaul said. “What happens if you have an active shooter in your store? We’re not only going to hear from experts but also some actual retailers talking about what really happened to them. I think you’ll have some raw emotions there from events that just happened.”

Awards will be presented during the President’s Gala on Thursday night and will include the Spirit of America Award, Capitol Impact Award and Lifetime Achievement Award. Other events at the convention will include a trade show, silent auction and Best Bagger Contest.

Reservations must be made by Sept. 17 to guarantee the convention rate at the resort.

Shaul is looking forward to the event at the “new” Margaritaville Lake Resort.

“I imagine we’ll have a margarita or two, or maybe even a Land Shark beer in the Land Shark Bar & Grill,” he said. “I think it’s going to be a fun time at Margaritaville Lake Resort.”

 

About the author

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Terrie

An 11-year employee of The Shelby Report who writes for and about food. In previous lives, she worked at a police department in Texas and an amusement park in Arkansas. She also was a newspaper publisher for more than a decade. Not sure which of those qualified her for this job.

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