July 27, 2010
Huntington Council Amends Occupation Tax Forcing Third Reading August 9
Delegate Receives Calls from New Businesses Wanting to Locate Outside City Limits
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – After placing a “cap” of $1,250 (i.e. no additional tax liability incurred after reading $125,000 in earnings) on the occupation tax, the occupation tax will likely come up for a vote at the Aug 9 council meeting. Council co-chairman Mark Bates received unanimous support in postponing votes on the sales tax and business tax reductions pending outcome of the occupation tax decision.
The “cap” passed 7-4 (Caserta , Ritter, Thacker, Loudermilk), which could place it in line for passage at the next meeting. One council member favored the limitation, but remains undecided on the tax itself.
At the meeting two week ago, Sandra Clements, Frances Jackson and Russ Houck voted to remove the earnings cap.
Attending the meeting were two Cabell County House of Delegates members, Kelli Sobonya ( R) and Carol Miller ( R). Both voted against authorizing home rule pilot authority on constitutional grounds.
Huntington and four other West Virginia cities have a five year “pilot” period of home rule authority. After that period, the legislature’s home rule board will review the accomplishments. The legislature will have to pass a bill to extend the program. If the program is not extended, then, the laws passed by cities under it would become moot after their authority ceases.
“I think they are rushing it because of the time table set forth by the legislature,” Sobonya told HNN. “I don’t agree with the taxation policy, but I can’t fault them for rushing through. I don’t think you can tax yourself to prosperity. ”
She verbally demonstrated Marshall University President Stephen Kopp’s forecast that the occupation tax would not attract people to the city. Sobonya, a realtor, told HNN that “there’s an overwhelming taxation without representation” concern among constituents she represents who live in Cabell County but work in Huntington. “People are asking why I have allowed Huntington to have taxing authority. I make it very clear that I did not [vote for the home rule pilot program].”
As a realtor since Huntington City Council has taken up the occupation tax once again, “I received two phone calls in one week from people who wanted to look at business property OUTSIDE the Huntington city limits. If you have 300 realtors on the Huntington Board of Realtors, and, I’m getting two phone calls, I can only imagine the number of phone calls others have received as well of people wanting to escape the taxation facing them in the near future.”
PROCEDURAL CHALLENGES BRING RECESS
Although the cap amendment passed, the procedure of amending itself was challenged by activist Tom McCalister. He told council that the body’s own codified rules of procedure do not provide for an amendment on second reading. Violation of the rules carries a maximum penalty of jail time.
When council chairman Jim Insco declined to follow the rule, McCalister blasted, “Let’s get the chief [of police] to put Insco in jail.”
McCalister refused to set down when called out of order. No one on council or member of law enforcement would approach the former councilman. Why? About eight years ago, then, Mayor Jean Dean ordered McCalister removed in handcuffs. In a federal court suit for violation of his civil rights, McCalister prevailed. The city paid $30,000 and attorney fees (to then ACLU attorney Jason Huber) to settle the case.
Instead, a recess was called to allow tempers to cool. Police Chief Skip Holbrook had a private conversation with McCalister during the recess.
CALL IN THE ATTORNEY
After the recess, City Attorney Scott McClure persuaded council that they were “on firm legal footing” in respect to the amendment versus procedure conflict.
McClure explained that state law provides that no vote can be taken at the meeting where an ordinance is amended. “Our [council] rules are inferior [to the state] and are in conflict with state law.” He surmised that council rules should themselves be amended to reflect the vote not taken at the meeting where amended.
SPEAKING IN OPPOSITON
A 7 p.m. tax protest attracted about 25-35 people most employees of Steel of West Virginia. However, the horn toots of support could be heard inside the council chamber even after the meeting started.
Hurricane resident Janet Cross demonstrated what non-residents of the city will do, she symbolically flipped a penny at council.
“You can take this penny but hell will freeze over before I spend any more money in this city,” she said.
Nina Barrett, chairwoman of Marshall University’s Classified Staff Council, had come to discuss the statement of MU President Dr. Stephen Kopp against the tax. However, the rules allowed for her to speak only on the amendment.
She stressed that based on the MU study from 2006 upon which the city has relied heavily one in four Huntington residents are below the poverty line. “The average income is $23,000. There are no high paying jobs. The burden is skewed in the wrong direction. Let [those] with higher incomes pay their fair share.”
Another MU employee, Kim White, complained that she is “an overtaxed middle class taxpayer. Why would you want to put a cap on the tax?”
AND IN FAVOR
Richard Cobb called the tax “a necessity,” however, he is a retiree so his pension would be exempt from the occupation tax.
Psychotherapist Dr. Dave Frederick, who moved to Huntington from California, favors the tax. He spoke of services in that state not offer here, such as traffic lights sensitive to traffic flow.
“I certainly would not move my business out of town,” Dr. Frederick said.
PART TIME FORMULAS
Council woman Frances Jackson inquired about workers who report to work inside the city limits, but spend a majority of their day outside the city limits, such as a delivery worker or repairperson.
McClure indicated that a formula is included to reflect tax paid for only the percentage of work inside the city limits.
Ms. Jackson then posed an interesting possibility, especially considering the potential constitutional issue and the pilot program having no case law in West Virginia.
Based on the ordinance, the occupation tax would take effect October 1, 2010 and on the same day the $3.00 per week user fee would end. IF a legal challenge is ongoing, the user fee collections continue.
However, Jackson posed what would happen if a challenge was filed AFTER the occupation tax took effect and user fee collections stopped.
McClure surmised that any court order stopping occupation tax collections would re-start the user fee mechanism. “I’ll be glad to look at the issue, “ he said, adding his “instinct” is that the city could go back and resume user fee collections.
THIRD READING
During Good and Welfare, councilman Scott McClure complained about not being recognized during the occupation tax discussion. He inferred that he may have asked for a rule waiver to allow the public to speak on the full ordinance, not just the amendment. As an example, Jim Insco, told former mayor Jean Dean that she had to address the amendment only.
However, his complaint had become moot as following the passage of the amendment, many would-be speakers in the standing room only chambers left.
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Delegate Receives Calls from New Businesses Wanting to Locate Outside City Limits
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – After placing a “cap” of $1,250 (i.e. no additional tax liability incurred after reading $125,000 in earnings) on the occupation tax, the occupation tax will likely come up for a vote at the Aug 9 council meeting. Council co-chairman Mark Bates received unanimous support in postponing votes on the sales tax and business tax reductions pending outcome of the occupation tax decision.
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At the meeting two week ago, Sandra Clements, Frances Jackson and Russ Houck voted to remove the earnings cap.
Attending the meeting were two Cabell County House of Delegates members, Kelli Sobonya ( R) and Carol Miller ( R). Both voted against authorizing home rule pilot authority on constitutional grounds.
Huntington and four other West Virginia cities have a five year “pilot” period of home rule authority. After that period, the legislature’s home rule board will review the accomplishments. The legislature will have to pass a bill to extend the program. If the program is not extended, then, the laws passed by cities under it would become moot after their authority ceases.
“I think they are rushing it because of the time table set forth by the legislature,” Sobonya told HNN. “I don’t agree with the taxation policy, but I can’t fault them for rushing through. I don’t think you can tax yourself to prosperity. ”
She verbally demonstrated Marshall University President Stephen Kopp’s forecast that the occupation tax would not attract people to the city. Sobonya, a realtor, told HNN that “there’s an overwhelming taxation without representation” concern among constituents she represents who live in Cabell County but work in Huntington. “People are asking why I have allowed Huntington to have taxing authority. I make it very clear that I did not [vote for the home rule pilot program].”
As a realtor since Huntington City Council has taken up the occupation tax once again, “I received two phone calls in one week from people who wanted to look at business property OUTSIDE the Huntington city limits. If you have 300 realtors on the Huntington Board of Realtors, and, I’m getting two phone calls, I can only imagine the number of phone calls others have received as well of people wanting to escape the taxation facing them in the near future.”
PROCEDURAL CHALLENGES BRING RECESS
Although the cap amendment passed, the procedure of amending itself was challenged by activist Tom McCalister. He told council that the body’s own codified rules of procedure do not provide for an amendment on second reading. Violation of the rules carries a maximum penalty of jail time.
When council chairman Jim Insco declined to follow the rule, McCalister blasted, “Let’s get the chief [of police] to put Insco in jail.”
McCalister refused to set down when called out of order. No one on council or member of law enforcement would approach the former councilman. Why? About eight years ago, then, Mayor Jean Dean ordered McCalister removed in handcuffs. In a federal court suit for violation of his civil rights, McCalister prevailed. The city paid $30,000 and attorney fees (to then ACLU attorney Jason Huber) to settle the case.
Instead, a recess was called to allow tempers to cool. Police Chief Skip Holbrook had a private conversation with McCalister during the recess.
CALL IN THE ATTORNEY
After the recess, City Attorney Scott McClure persuaded council that they were “on firm legal footing” in respect to the amendment versus procedure conflict.
McClure explained that state law provides that no vote can be taken at the meeting where an ordinance is amended. “Our [council] rules are inferior [to the state] and are in conflict with state law.” He surmised that council rules should themselves be amended to reflect the vote not taken at the meeting where amended.
SPEAKING IN OPPOSITON
A 7 p.m. tax protest attracted about 25-35 people most employees of Steel of West Virginia. However, the horn toots of support could be heard inside the council chamber even after the meeting started.
Hurricane resident Janet Cross demonstrated what non-residents of the city will do, she symbolically flipped a penny at council.
“You can take this penny but hell will freeze over before I spend any more money in this city,” she said.
Nina Barrett, chairwoman of Marshall University’s Classified Staff Council, had come to discuss the statement of MU President Dr. Stephen Kopp against the tax. However, the rules allowed for her to speak only on the amendment.
She stressed that based on the MU study from 2006 upon which the city has relied heavily one in four Huntington residents are below the poverty line. “The average income is $23,000. There are no high paying jobs. The burden is skewed in the wrong direction. Let [those] with higher incomes pay their fair share.”
Another MU employee, Kim White, complained that she is “an overtaxed middle class taxpayer. Why would you want to put a cap on the tax?”
AND IN FAVOR
Richard Cobb called the tax “a necessity,” however, he is a retiree so his pension would be exempt from the occupation tax.
Psychotherapist Dr. Dave Frederick, who moved to Huntington from California, favors the tax. He spoke of services in that state not offer here, such as traffic lights sensitive to traffic flow.
“I certainly would not move my business out of town,” Dr. Frederick said.
PART TIME FORMULAS
Council woman Frances Jackson inquired about workers who report to work inside the city limits, but spend a majority of their day outside the city limits, such as a delivery worker or repairperson.
McClure indicated that a formula is included to reflect tax paid for only the percentage of work inside the city limits.
Ms. Jackson then posed an interesting possibility, especially considering the potential constitutional issue and the pilot program having no case law in West Virginia.
Based on the ordinance, the occupation tax would take effect October 1, 2010 and on the same day the $3.00 per week user fee would end. IF a legal challenge is ongoing, the user fee collections continue.
However, Jackson posed what would happen if a challenge was filed AFTER the occupation tax took effect and user fee collections stopped.
McClure surmised that any court order stopping occupation tax collections would re-start the user fee mechanism. “I’ll be glad to look at the issue, “ he said, adding his “instinct” is that the city could go back and resume user fee collections.
THIRD READING
During Good and Welfare, councilman Scott McClure complained about not being recognized during the occupation tax discussion. He inferred that he may have asked for a rule waiver to allow the public to speak on the full ordinance, not just the amendment. As an example, Jim Insco, told former mayor Jean Dean that she had to address the amendment only.
However, his complaint had become moot as following the passage of the amendment, many would-be speakers in the standing room only chambers left.
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