A bill authorizing Starkville’s 2 percent food and beverage tax renewal is not expected this legislative term, local and state representatives confirmed this week.
State Rep. Tyrone Ellis, D-Starkville, said the House should tackle the matter next year as lawmakers usually choose not to renew such local tax levies until the year they expire.
Starkville’s 2 percent food and beverage tax is set to expire in 2015.
Officials hoped the Legislature would deal with the matter this year, but state Rep. Gary Chism, R-Columbus, previously said gridlock is slowing down the House as it approaches an 8 p.m. deadline tonight to move other important legislation forward.
“We have received words that in all likelihood (lawmakers) will not consider a 2 percent tax bill this year because the tax does not expire until next year. The local and private committee chairs in the past have not allowed a bill to come forward until the legislative session in the same year it is set to expire,” Mayor Parker Wiseman said.
State lawmakers passed a local and private bill 20 years ago allowing Starkville to impose a 2 percent economic development, tourism and convention tax on the gross revenue of restaurants derived from the sale of prepared food and beverages, both alcoholic and non-alcoholic. Residents would go on to approve the tax in a local referendum.
A second bill was passed in 2004 that amended the entities receiving distributions from the tax and extended the levy through June 30, 2015. Currently, revenues are divided between Starkville Parks (40 percent), Mississippi State University student groups (20 percent), Oktibbeha County Economic Development Authority (15 percent) Starkville Convention and Visitors Bureau (15 percent). The remaining 10 percent returns to the city.
Aldermen previously supported a resolution to renew the city’s 2 percent levy with the same distributions earlier this month. It asks lawmakers to extend the tax through June 30, 2020.
Since the city is requesting no changes to the current law, its resolution also seeks exemption from a future referendum on the matter.
Documents obtained by The Dispatch show collections have grown from $558,132.96 in Fiscal Year 1996 to $1.58 million in Fiscal Year 2013.
The extra revenue’s effects have been felt across the city. For example, a portion of the 2 percent proceeds are obligated to service debt remaining on the Sportsplex through 2026. Additionally, OCEDA uses the funding to help subsidize its portion of the economic development contract with the Golden Triangle Development Link, the organization charged with industrial and job enticement for all of Oktibbeha County.
“There has been no policy over the course of the last 20 years that has been as impactful as the 2 percent food and beverage tax in moving our city forward,” Wiseman previously told The Dispatch.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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