Wednesday, July 31, 2002

Two hundred million dollars of our tax dollars are about to be parceled out in virtual secrecy by our Fayette County commissioners and city elected officials. Perhaps this is the right time to pay attention.

In more naive days, many counties in Georgia, including Fayette, elected to have a Local Option Sales Tax (LOST). That's the 1 percent we pay today on top of the 4 percent state sales tax.

Back in 1999, our Board of Education estimated (fairly, I believe) that each 1 percent of local sales tax would bring in about $90 million over five years, so it is reasonable to think that between 2003 and 2012 this tax would raise $200 million. That comes largely out of our pockets as consumers, of course, when large items like cars are purchased or ongoing purchases of items like groceries are made.

This $200 million tax will be paid by Fayette county citizens and basically belongs to the county, and all its citizens. After all, haven't all the county's citizens paid it? Haven't they all paid the same rate of 1 percent?

Through a flaw in the law creating the LOST, counties are expected to negotiate with the cities within the county over the distribution of the LOST revenues among themselves. These negotiations are expected to take place every 10 years, after the latest census data is in. They are taking place right now. Were it not for the self-reported ethical lapses of the Peachtree City mayor, we might not even know these negotiations are going on.

The last time this tax pie was divided into pieces was in August 1992. At the time, Peachtree City was given 35.64 percent, Fayetteville was given 11.36 percent, Tyrone got 4.91 percent, and tiny Brooks got .59 percent. The county government got the remainder, 47.5 percent. That's now been going on for 10 years.

This division was pretty much in line with the population of the cities and of the unincorporated part of the county in 1990.

If the citizens who live in the unincorporated part of the county represent 47.5 percent of our population, it is fair to think they pay 47.5 percent of the county's local sales tax. The problem comes from what the county does with its 47.5 percent share. It does not use it just for the benefit of the citizens in the unincorporated part of the county, it uses it for the benefit of all county citizens, which it advertises for all the world to see in our county property tax bills (to be received in the fall) by showing how the county property tax of every taxpayer in the county, including those in the cities, was reduced by the county share of the local sales tax.

Thus city residents receive their full share of the local sales tax through their cities (as a reduction of their city property tax), and then they get some more through a further reduction in their county property taxes. The unincorporated residents essentially get back just 47.5 percent of what they paid in local sales tax (and they are not supposed to notice).

There are two obvious potential solutions here. One would be for the county to use the local sales tax it gets from the unincorporated residents for the exclusive benefit of the unincorporated residents and not for the city residents. But apparently the law does not permit that.

The other solution would be for the county to receive 100 percent of the local sales tax, and then apply it equitably among all its citizens, whether they live in cities or the country. City residents would get their fair share, but they would not be getting it through their city government. That would make city government officials mad, but it would still be fair.

There is a third possible solution. If the cities and the county can't agree on the split of this tax pie, the tax just stops. Stopping this local sales tax might not be such a bad idea, when you think about it, because we have many commercial property owners and large land owners in this county who don't pay a lick of sales tax and then enjoy a property tax "rebate" from the local sales tax. The reason they don't pay sales tax is that they hardly buy anything. It is reasonable to think that property taxes, including theirs, would go up a little if the local sales tax is removed, but for those of us who'd otherwise pay the local sales tax there would be a nice reduction in sales tax to make up for the property tax increase.

These are the things politicians don't talk about. Since we have an election coming, we should make them talk about it. We are probably doomed to 10 more years of inequitable taxation anyway, since the deal is likely to be cut next month (August 2002), the cities are hungry, and some of our commissioners are weak. Sometimes our politicians wonder why we, the public, hold them in contempt. It might be because they tolerate situations like this.

Claude Y. Paquin

Fayette County

cypaquin@msn.com

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