Battle for Sales Tax Rages into New Year

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“They’re asking the Cities to subsidize the County for poor planning, for poor decision making.”

Ellijay continues to duel into next year for its portion of the Local Option Sales Tax (L.O.S.T.). At its December 19th Workshop, the Ellijay City Council continued to craft its strategy to keep its portion of L.O.S.T., an issue that’s plagued the City since August.

Every ten years, cities and counties are required to negotiate their percentage of revenue of the sales tax. Currently, the County receives 74 percent, Ellijay 17 percent and East Ellijay 10 percent. Negotiations were initiated in August, when Gilmer County Commission Chairman J.C. Sanford hand-delivered letters to the two Cities with the County’s offer for new percentages. The County’s offer was not well received by the Cities.

The offer increased the County’s percentage to 90.107 percent, while decreasing Ellijay’s to 6.753 percent and East Ellijay’s to 3.14 percent. In September, after reviewing the percentages, Ellijay’s Council passed a resolution giving Mayor Al Hoyle the authority to negotiate with the County and its brother city. Since September, the County and the two Cities have entered a fray over the figures. The most recent offer from the County has Ellijay at 15 percent, higher than the first offer, although lower than its current percentage and East Ellijay at 6 percent, again, higher than the first offer, although lower than its current percentage.

At the December workshop, Mayor Pro Tem David Westmoreland was the most vocal about the issue.

“Everyone’s sales tax numbers are dropping,” he said, “and they’re asking the Cities to subsidize the County for poor planning, for poor decision making.”

Overall and with Westmoreland holding the battle banner, the Council discussed more of the matter of arbitration than of the possibility of a promising negotiation with the County.

“Since the last negotiation ten years ago,” Westmoreland explained, “the sale tax revenue has grown even more proportionately greater in the cities than the counties during that time; that would probably be the thrust of our argument, to at least keep it where it is (17 percent),” adding “I think to be equitable, we would at least stay where we’re at and Gilmer County would give a couple of percentages more to East Ellijay.”

Previously, though, The Gilmer County Board of Commissioners in part justified its increase on terms of duplication of services. This means that the County and Cities provide the same services, such as police departments. The County argues that the Cities could receive less of the sales tax, since they do not need to provide these services. Conceivably, duplicate services can be combined and assigned to one municipality.

“There will be a point next year,” Hoyle said, “that we’ll have to go to baseball arbitration.”

Hoyle explained that the City can temporarily avoid arbitration as long as the County and the Cities agree to keep negotiating. The Council decided not to take action on negotiating the sales tax and Mayor Hoyle said he would schedule another meeting with the County, which takes the negotiations into next year.

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