State Innovation – Sales Tax and Trust Funds
While most states currently do not allow for the creation of local community trust funds for children (and would require change in state laws), Missouri has given local authority to establish trusts since 1998. A state statute was originally passed in 1998 and then revised in 2015 to allow for the establishment of local children’s funds.
The statute allows the county or city to levy a sales tax to create a community children’s services fund for the purpose of providing services to protect the well-being and safety of children and youth, age 19 or younger. These funds create a local Children’s Services Fund (CSF), which comes from a ¼ of one cent sales tax. Once the measure passes at a county level and the funding has been established, there is no sunset or expiration on the tax.
Number of Counties with a Children's Services Fund
Amount Generated Annually (in millions) by the Children's Services Fund
Local county Children’s Services Funds act as a grant making authority to directly fund programs. Children’s Services Funds holds an annual request for proposal (RFP) process. The fund is managed by a nine-member independent board. This board is set up as an independent 501(c)3, with the nine members appointed by the county commissioners. There is a term limit of three years and sometimes the board is informed by a citizen advisory committee. The Children’s Services Funds model generates money for mental health services for children. It is not for educational programming nor early childhood education. The money can fund services that reinforce early childhood services such as mental health screening and social emotional skill development. The funding cannot be used to increase child care or preschool slots.
Currently eight counties in Missouri have a Children’s Services Fund that together generate more than $70 million dollars annually. St. Charles County was the first county in Missouri to enact this local legislation and create a Children’s Services Fund. When the new tax was first approved by voters in 2004, St. Charles County was 85th out of 114 counties in Missouri for providing mental health services to children. Now, over 12 years later, it is ranked as number one. Additionally, all eight counties that passed this legislation were in the bottom 50% and ranked 60th or worse (out of 114 counties) for providing mental health services. Today, they all rank in the top 50%. The return on investment is eleven to one – for every one dollar invested, local communities gain over eleven dollars back due to lowered health care and incarceration costs.
Local communities have to monitor state legislatures to make sure funds are not re-appropriated for non-mental health services for children. In 2014, a state legislator unsuccessfully tried to re-direct the money generated for Children’s Services Funds away from mental health services and to public education. Revisions were successfully passed to the state statute in 2015 that have solidified local control, which means that if a local community has a voter-approved tax, then it can only be modified by the voters, not local government nor the state legislature.