Article Comment 

Competing tax resolutions put CVB in jeopardy

 

Gary Chism

Gary Chism

 

Bill Gavin

Bill Gavin

 

 

Zack Plair

 

 

There are officially two competing resolutions seeking to renew the 2-percent food and beverage tax in Lowndes County. 

 

Columbus city councilmen Tuesday unanimously approved a resolution providing the city a cut of the annual tax revenue, a day after Lowndes County supervisors approved, by a 3-2 margin, a separate measure to divide the funds only between the Columbus-Lowndes Convention and Visitors Bureau and the Golden Triangle LINK. 

 

The competing measures seemingly set up a collision course that will either force the two entities to negotiate a compromise or potentially kill the tax that has funded tourism and economic development for the last decade. 

 

"Right now, I don't know where it goes from here," Mayor Robert Smith told The Dispatch after Tuesday's council meeting in the Fant Library at Mississippi University for Women. "We'll share our resolution with the county, and they can decide whether they want to come sit down with us and negotiate." 

 

The tax, as it is set up now, collects an extra 2 percent from prepared food and beverage sales at businesses where such sales gross at least $325,000 annually.  

 

The current 10-year term for the tax expires on July 1, 2018. For it to continue past that point, the Mississippi Legislature must vote to renew it during its upcoming session, which begins in January. 

 

In Fiscal Year 2017, the tax raised nearly $2 million -- 85 percent of which funded the CVB and 15 percent of which helped the LINK with economic development. 

 

The resolution the city passed Tuesday asks the Legislature for 20 percent of that tax (which in FY 2017 would have been about $360,000) annually for parks and recreation, along with another $100,000 each year to help the city complete the Sen. Terry Brown Amphitheater project on The Island. 

 

Further, the city's resolution seeks to change the CVB makeup to seven members, with five appointed by the city and two by the county. Now, the nine-member board includes four city members, four county members and a joint appointment. 

 

The resolution also seeks the "remove the floor" of the tax, meaning all restaurants would be required to assess the tax on its customers regardless of their gross food and beverage revenue. That way, City Attorney Jeff Turnage said, the tax would generate more revenue overall. And he clarified it wouldn't cost the restaurants any money since the customers are the ones who pay the tax. 

 

In the county's resolution, supervisors are asking for the LINK to receive a set $250,000 annually from the tax, while CVB receives the rest -- which was what CVB director Nancy Carpenter and LINK head Joe Max Higgins first proposed to both the supervisor board and city council in October. 

 

The money CVB receives from the tax makes up nearly all of its annual budget. 

 

 

 

'Clear heads' 

 

In order for the tax renewal to pass muster with the Legislature, District 37 Rep. Gary Chism (R-Columbus) said it requires a joint resolution -- ideally a unanimous one -- from the city and county. 

 

Without a joint resolution, he told The Dispatch Monday, it would be like they sent "nothing at all." 

 

Chism, who chairs the House Local and Private Legislation Committee that handles taxes of this nature, said technically the tax could expire, and the city could apply for its own sales tax for CVB. But he said if Columbus did that, it would be a hard row to hoe. 

 

"If it expires and the city decides to come back with one for themselves, that's a new tax," Chism said. "I'll tell you right now, I'm not going to vote for a new tax. I'll do my best to alert the people on the committee that I'm on that this is a new tax. There are five Republicans and two Democrats on the committee, so think about what that means." 

 

But even if it passes in Jackson, Chism said the new tax would require a direct referendum that he said he would work to ensure was a countywide vote. It would require 60-percent voter approval, too. 

 

"When you add all that up, I think it would be pretty difficult for the city to do this on their own," he said. "The best thing they could do, in my opinion, is to sit down and hammer out a deal they can both live with." 

 

Ward 6 Councilman Bill Gavin admitted it would be "unfortunate for everybody" if the tax went away, and he believes ultimately the city and county will reach a compromise. 

 

"I think there will be another vote," he said. "If we all come together with clear heads, we could come to a solution very easily." 

 

Higgins told The Dispatch Monday he is willing to mediate between the two parties to help them each an agreement. 

 

That sounded good to Gavin. 

 

"I would welcome his input," Gavin said. 

 

Reporter Slim Smith contributed to this article.

 

Zack Plair is the managing editor for The Dispatch.

 

 

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