Questions about city’s finances sparks discussion about 1999 SPLOST dollars

Dollars from a 1999 Special Purpose Local Option Sales Tax are still rolling into city coffers, despite attempts from local officials to address the problem, according to administrators.

Deputy City Manager Pam Hodge explained the situation to Columbus Council last week at a council meeting,

after Mayor Pro Tem Evelyn Pugh expressed concern about the way the state is handling the one cent sales tax. Hodge said the city has tried to resolve the issue to no avail.

“For many years after SPLOST has ended, we continue to receive SPLOST proceeds and the question was raised, ‘Well, why don’t you stop them from submitting dollars that they shouldn’t be collecting?’” Hodge said. “We’ve contacted the Department of Revenue numerous times. And their response to us was, the only way that they would tell a business to no longer collect SPLOST dollars would be if they came up for a random audit and they determined that they were collecting sales tax that was not in effect any longer.”

Hodge, deputy city manager for finance, planning and development, said the city sent postcards to businesses registered with the city in 2008, telling them that the tax is no longer supposed to be collected and that they need to change their systems. Yet, the problem continues, she said.

“We contacted the Department of Revenue again yesterday and they tell us, again, the burden is on the local government to contact the businesses, but they won’t tell us who those businesses are,” she said. “The state has the data, but we don’t have access to it, and it makes it very difficult to notify someone if we don’t know who they are.”

City Manager Isaiah Hugley said Atlanta is the only city in the state that gets the data. That’s because of legislation that requires the state to provide the information to cities with a population of 500,000 or more, he explained.

Councilor Judy Thomas asked Hodge: “... Are you saying that there are businesses that are collecting the 4 percent state sales tax, the 2 percent Local Options Sales tax for the city, the TSPLOST, the ESPLOST for the school district, and then another penny?”

“I don’t know the answer to that,” Hodge said. “My guess would be that they never changed their system. So they might not be collecting the TSPLOST, they might still be collecting the SPLOST.”

According to information that Hodge provided, the city received tax proceeds of $10,836 from the 1999 SPLOST in 2016. Excess proceeds, including 1999 SPLOST interest, were spent on:

• Public safety vehicles ($5 million)
• Animal shelter ($500,000)
• Trade Center ($2 million)
• Recreation ($13.2 million)
• Transportation ($2.8 million)
• Storm/Drainage ($6.7 million)
• Library ($6 million)
• Roads ($16.1 million)

Some councilors expressed frustration with the situation:

Thomas said: “We are, obviously, not the only government in the state of Georgia that this is happening to, and it just blows my mind that the legislative delegations all over the state keep saying to the Department of Revenue — I know our folks do — that we need to change this, we need to look at this, we need to clean this up. And the Revenue Department says, “Oh well.”

Councilor Gary Allen described the example as the “poster child” for what the council has been requesting from the legislative delegation for 10 years.

“I’m almost at the point where I want to go out to the community that Mr. Strode is a member on Facebook and say, ‘You need to put pressure on your legislative delegation to get this changed so we can put the dollars in the right column,’” he said. “And the local companies won’t be charging local citizens and the purchasers of the products an extra penny for whatever they’re buying ... It’s just ridiculous.”

This story was originally published February 19, 2017 at 3:32 PM with the headline "Questions about city’s finances sparks discussion about 1999 SPLOST dollars."