Sept. 28, 2010
Huntington Council, Administration Temporarily Step Back from Occupation Tax
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) –During its Finance Committee and full City Council meeting, the city’s governing body joined with the Wolfe Administration in, at least, temporarily stepping back from the proposed occupation tax. The tax had been scheduled to take effect October 1, but the Municipal Home Rule Committee tabled the measure pending the preparation of additional documents for the committee.
Earlier Monday, Sept. 27, Mayor Kim Wolfe held a news conference: “The implementation for the Municipal Occupation Tax has been delayed pending a decision by the Home Rule Board. Employers and self-employed persons should continue to withhold and pay the $3 per week City Service Fee using existing forms.”
CONTINUE WITHHOLDING USER FEE
Wolfe continued, “Employers should disregard the letter dated September 16 from Finance Director Deron Runyon until further notice. The letter was sent in anticipation of the October 1 start date of the Municipal Occupation Tax. The staff and I sought to provide employers with adequate notice and information as it related to the withholding of the 1% Occupation Tax and the dissolution of the City Service Fee.”
Although there has been speculation about the amount of time needed for the city’s compliance, Wolfe said the “tabling of the plan” means “it is unknown when the tax reform plan will take effect. In today’s political climate, I know that we are asking local and state leaders to make difficult , politically unfavorable recommendations.” Still, he stressed the city will answer the questions on feasibility and constitutionality of our plan “in a timely fashion , because time is of the essence for our great community.”
HOSPITAL ADMINISTRATORS NEUTRAL
The tax reform package containing the occupation tax has sparked polarizing opinions --- both in favor and mostly against. For that reason, the Mayor clarified a previous statement that two large employers supported to the tax. Wolfe explained that the administrators of Cabell Huntington and St. Mary’s Hospital cannot take a position on the occupation tax. However, they do “support our efforts to revitalize the city in the home rule plans.”
Since the phrase “home rule” has often been characterized as only a city’s power to levy taxes, he stressed they support many of the other home rule provisions which would help move the city forward.
The mayor should in previous statements have added that the hospital C.E.O.’s remain “neutral” on the [occupation] tax itself.
“What’s being reported out there [now] is bogus. I called the administrator’s and apologized for any misinformation,” Wolfe said.
ENSURING CONTINUED CITY REVENUE FLOW
At the finance committee meeting, council took the first steps to ensure city revenue flowed, despite the holding patterns for the occupation tax and sales tax.
An ordinance has been introduced that extends the $3.00 per week city service fee. Enactment of the occupation tax would have removed the $3.00 per week user fee, but with the tax “tabled” by the Home Rule Board and one or more potential suits pending , if approved, the ordinance specifies that user fee collections continue until such time as the city is authorized to collect the occupation tax.
City Attorney Scott McClure explained that the service fee ordinance will ensure “we won’t have gaps in revenue [collections]. We did not envision a delay at the home rule board or a [possible] court order [injunction].”
The ordinance stipulates actions under the current impending litigation scenario, a possibility that had been raised proactively during council discussions by councilwoman Frances Jackson.
OCCUPATION TAX REVENUES NOT INCLUDED IN FISCAL 2010-2011 BUDGET
After the Finance Committee meeting both Steve Williams and Mark Bates clarified that the occupation tax and sales tax collection delays do not leave ‘holes’ in the 2010-2011 budget. Williams explained that the budget had been approved without counting revenues from the taxes. The amount of collection were projections.
With the tax reform plan currently tabled, council will hold a special session on or about October 4 for second reading of the ordinance that extends the ‘user fee’
COMPLYING WITH THE HOME RULE BOARD
The time frame for going back to the Home Rule Board remains questionable. Occupation tax foes should not think it’s time to pull down the goal posts. Instead, the tabling may more likely be classified as an intermission or half time in the battle.
City Attorney Scott McClure feels confident that he in his capacity of city attorney can provide the constitutional certification that the Board requested.
Adding to the uncertainties activist and former council member Tom McCallister questioned McClure’s interpretation of the constitutional certification procedure.
Still, McClure stressed that the city attorney’s legal opinion has sufficed the adoption of other home rule ordinances.
“I prepare the certification of constitutionality [stating] that we have reviewed the U.S. and W.Va. Constitutions” and have determined a “good faith guess” that it is constitutional.
McClure explained to HNN that the current West Virginia Code contains special circumstances enabling the collection of both an occupation tax and a city sales tax. For instance, an occupation tax could be levied if a city is severely in debt on police and fire pensions. Huntington would have qualified under that exception, but the legislature passed a law that allowed cities, such as Huntington, to re-amortize the liability.
On Sunday, Del. Kelli Sobonya , who voted against the pilot program on constitutional grounds, told HNN, “The unconstitutionality lies with the passage of the Home Rule Pilot Project bill passed by the Legislature. The entire bill is unconstitutional regardless of whether Huntington passes taxes. You can't give certain cities special powers by cherry picking them,” Sobonya stated.
EXECUTIVE SESSION?
Councilman Nate Randolph queried McClure whether the possible County Commission suit should be discussed behind closed doors, under the litigation exception to an open meeting. He contemplated working out an agreement with the commission that the suit would be filed in a timely manner and not simply become an occupation tax delaying tactic.
McClure told Randolph that currently such a meeting would be unnecessary. “I think if [the home rule board] passed our revised plan, the commission would have filed Friday.”
(Editor’s Note: One report stated that the commission will NOT sue Huntington but sue the State of West Virginia regarding the constitutionality of the pilot program.)
On the delay, Tom McCalister for one, speculated that the board’s decision could be a strategy to “wait until after the Nov. 2 election.” State delegates and some state Senators are up for re-election, and, if the controversial occupation tax provision had been approved, it might have positioned the issue more in the re-election spotlight. Similarly, the county commission may not be as anxious to undertake the challenge, after the election too.
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Huntington Council, Administration Temporarily Step Back from Occupation Tax
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) –During its Finance Committee and full City Council meeting, the city’s governing body joined with the Wolfe Administration in, at least, temporarily stepping back from the proposed occupation tax. The tax had been scheduled to take effect October 1, but the Municipal Home Rule Committee tabled the measure pending the preparation of additional documents for the committee.
Earlier Monday, Sept. 27, Mayor Kim Wolfe held a news conference: “The implementation for the Municipal Occupation Tax has been delayed pending a decision by the Home Rule Board. Employers and self-employed persons should continue to withhold and pay the $3 per week City Service Fee using existing forms.”
CONTINUE WITHHOLDING USER FEE
Wolfe continued, “Employers should disregard the letter dated September 16 from Finance Director Deron Runyon until further notice. The letter was sent in anticipation of the October 1 start date of the Municipal Occupation Tax. The staff and I sought to provide employers with adequate notice and information as it related to the withholding of the 1% Occupation Tax and the dissolution of the City Service Fee.”
Although there has been speculation about the amount of time needed for the city’s compliance, Wolfe said the “tabling of the plan” means “it is unknown when the tax reform plan will take effect. In today’s political climate, I know that we are asking local and state leaders to make difficult , politically unfavorable recommendations.” Still, he stressed the city will answer the questions on feasibility and constitutionality of our plan “in a timely fashion , because time is of the essence for our great community.”
HOSPITAL ADMINISTRATORS NEUTRAL
The tax reform package containing the occupation tax has sparked polarizing opinions --- both in favor and mostly against. For that reason, the Mayor clarified a previous statement that two large employers supported to the tax. Wolfe explained that the administrators of Cabell Huntington and St. Mary’s Hospital cannot take a position on the occupation tax. However, they do “support our efforts to revitalize the city in the home rule plans.”
Since the phrase “home rule” has often been characterized as only a city’s power to levy taxes, he stressed they support many of the other home rule provisions which would help move the city forward.
The mayor should in previous statements have added that the hospital C.E.O.’s remain “neutral” on the [occupation] tax itself.
“What’s being reported out there [now] is bogus. I called the administrator’s and apologized for any misinformation,” Wolfe said.
ENSURING CONTINUED CITY REVENUE FLOW
At the finance committee meeting, council took the first steps to ensure city revenue flowed, despite the holding patterns for the occupation tax and sales tax.
An ordinance has been introduced that extends the $3.00 per week city service fee. Enactment of the occupation tax would have removed the $3.00 per week user fee, but with the tax “tabled” by the Home Rule Board and one or more potential suits pending , if approved, the ordinance specifies that user fee collections continue until such time as the city is authorized to collect the occupation tax.
City Attorney Scott McClure explained that the service fee ordinance will ensure “we won’t have gaps in revenue [collections]. We did not envision a delay at the home rule board or a [possible] court order [injunction].”
The ordinance stipulates actions under the current impending litigation scenario, a possibility that had been raised proactively during council discussions by councilwoman Frances Jackson.
OCCUPATION TAX REVENUES NOT INCLUDED IN FISCAL 2010-2011 BUDGET
After the Finance Committee meeting both Steve Williams and Mark Bates clarified that the occupation tax and sales tax collection delays do not leave ‘holes’ in the 2010-2011 budget. Williams explained that the budget had been approved without counting revenues from the taxes. The amount of collection were projections.
With the tax reform plan currently tabled, council will hold a special session on or about October 4 for second reading of the ordinance that extends the ‘user fee’
COMPLYING WITH THE HOME RULE BOARD
The time frame for going back to the Home Rule Board remains questionable. Occupation tax foes should not think it’s time to pull down the goal posts. Instead, the tabling may more likely be classified as an intermission or half time in the battle.
City Attorney Scott McClure feels confident that he in his capacity of city attorney can provide the constitutional certification that the Board requested.
Adding to the uncertainties activist and former council member Tom McCallister questioned McClure’s interpretation of the constitutional certification procedure.
Still, McClure stressed that the city attorney’s legal opinion has sufficed the adoption of other home rule ordinances.
“I prepare the certification of constitutionality [stating] that we have reviewed the U.S. and W.Va. Constitutions” and have determined a “good faith guess” that it is constitutional.
McClure explained to HNN that the current West Virginia Code contains special circumstances enabling the collection of both an occupation tax and a city sales tax. For instance, an occupation tax could be levied if a city is severely in debt on police and fire pensions. Huntington would have qualified under that exception, but the legislature passed a law that allowed cities, such as Huntington, to re-amortize the liability.
On Sunday, Del. Kelli Sobonya , who voted against the pilot program on constitutional grounds, told HNN, “The unconstitutionality lies with the passage of the Home Rule Pilot Project bill passed by the Legislature. The entire bill is unconstitutional regardless of whether Huntington passes taxes. You can't give certain cities special powers by cherry picking them,” Sobonya stated.
EXECUTIVE SESSION?
Councilman Nate Randolph queried McClure whether the possible County Commission suit should be discussed behind closed doors, under the litigation exception to an open meeting. He contemplated working out an agreement with the commission that the suit would be filed in a timely manner and not simply become an occupation tax delaying tactic.
McClure told Randolph that currently such a meeting would be unnecessary. “I think if [the home rule board] passed our revised plan, the commission would have filed Friday.”
(Editor’s Note: One report stated that the commission will NOT sue Huntington but sue the State of West Virginia regarding the constitutionality of the pilot program.)
On the delay, Tom McCalister for one, speculated that the board’s decision could be a strategy to “wait until after the Nov. 2 election.” State delegates and some state Senators are up for re-election, and, if the controversial occupation tax provision had been approved, it might have positioned the issue more in the re-election spotlight. Similarly, the county commission may not be as anxious to undertake the challenge, after the election too.
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