Derby sales tax dispute settled

Attorneys for the city of Derby and the Kansas Department of Revenue have reached an agreement on terms to settle a dispute over how the state has been distributing revenues from the half-cent Derby Difference sales and use tax.

The parties filed a request Nov. 15 in Shawnee County District Court for a consent judgment and final order to ensure the state begins in December 2018 to remit all revenues collected from the Derby tax to the city instead of remitting a considerable portion of those revenues to Sedgwick County.

In 2013, the 0.5 percent tax was approved by Derby voters to make park improvements and to supplement operations of the library and fire and rescue department. In late 2015, Derby officials learned that the state had implemented an automated system that distributed a portion of Derby’s tax revenues from certain vehicle sales to the county.

In 2016, Derby pointed out the error to KDOR, but after receiving no relief, turned to the judicial system for interpretation and enforcement of the law.