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Restaurant tax: CVB again delays restaurant tax deal with city

 

The Columbus-Lowndes Convention and Visitors Bureau board has still not approved an inter-local agreement with the city on how to distribute future 2-percent restaurant funds, despite a special-call meeting Wednesday to discuss the issue. The board will meet again on Tuesday.

The Columbus-Lowndes Convention and Visitors Bureau board has still not approved an inter-local agreement with the city on how to distribute future 2-percent restaurant funds, despite a special-call meeting Wednesday to discuss the issue. The board will meet again on Tuesday. Photo by: Luisa Porter/Dispatch Staff

 

CVB board chairman Dewitt Hicks voted against the board delaying action on an inter-local agreement with the city involving the restaurant tax because he is

CVB board chairman Dewitt Hicks voted against the board delaying action on an inter-local agreement with the city involving the restaurant tax because he is "ready for this to end," referencing the months-long struggle to settle the issue.
Photo by: Luisa Porter/Dispatch Staff

 

From left, Steve Wallace, David Armstrong and Rissa Lawrence

From left, Steve Wallace, David Armstrong and Rissa Lawrence

 

 

Zack Plair

 

 

Another last-minute wrinkle has delayed for at least another week the Columbus-Lowndes Convention and Visitors Bureau and the city reaching an inter-local agreement on dividing restaurant sales tax revenues. 

 

By an 8-1 vote, the CVB board decided during a special-call meeting Wednesday to require the city to provide a "complete document" with no need of revision or correction for board approval. The decision came after CVB board attorney Chris Hemphill outlined a city proposed compromise to the latest disagreement between the two entities on the issue -- of whether the CVB should begin distributing money to the city in July when the tax renews or in October when the new CVB budget year begins. 

 

While the CVB seems prepared to begin distributing the funds in monthly installments in October, the city had expected those payments to begin in July. 

 

The city provided Hemphill with the proposed compromise earlier Wednesday, and most CVB board members claimed they were hearing about it for the first time at the board table. 

 

Ultimately, CVB board members postponed the matter and scheduled another special-call meeting for 4 p.m. Tuesday, which is an hour before city council members are scheduled to meet and likely vote on some version of an inter-local agreement. 

 

"We're being asked to accept an incomplete document," board member Steve Wallace said, while moving the CVB delay action on the agreement. "... Bring me something and say 'this is what we're wanting' and I'll consider it. ... I do not like the idea of this being piecemeal." 

 

CVB board chairman Dewitt Hicks was the lone vote against waiting, although he vented his frustration with the city's last-minute proposal. 

 

"I'm ready for this to end," he said. "I'm tired of having meetings. That's why I voted against (further delays)." 

 

The city first presented the inter-local agreement to the CVB board on Jan. 22, but board members didn't approve it because of the city's last-minute funding request for specific special events. CVB countered with some last-minute provisions of its own, which city administration flatly rejected. 

 

The restaurant tax requires the Mississippi Legislature's approval to extend beyond its June 30 expiration. It raised $2 million in Fiscal Year 2017. 

 

 

 

Debate on when, and how much, to start paying 

 

CVB board members arrived to Wednesday's meeting expecting to vote on whether to distribute $400,000 of tax revenues annually to the city for certain projects. 

 

Of that, the city would use $300,000 for baseball field improvements at Propst Park and $50,000 toward completing the Sen. Terry Brown Amphitheater on The Island. The remaining $50,000 would be divided evenly ($12,500 each) between four annual festivals in the city -- Market Street, Southside/Townsend, Seventh Avenue Heritage and Juneteenth -- provided the events follow the CVB's prescribed application and documentation procedures for special events. 

 

The compromise, which Hemphill hammered out with City Attorney Jeff Turnage, would allow CVB to begin paying in October -- meaning the deal would not impact its budget for the current fiscal year -- but it would essentially pay 15 months' worth in the first year to make up for the $87,500 owed from the first three months of nonpayment. 

 

What that would look like, Hemphill said, is the CVB would turn back $36,457 for each the first 12 months (a roughly $7,291 increase), after which it would begin paying just the regular installments of about $29,166. 

 

The majority of the CVB board seemed amenable, if not somewhat confused, by the requested arrangement. 

 

After a vote to accept the inter-local agreement to include the amended pay schedule failed 6-3, Wallace's motion to wait for a "complete document" passed. 

 

Hemphill told The Dispatch the board's action was "unorthodox" considering the board could have approved the inter-local agreement pending the new payment language being added. But he said he understood the board's position. 

 

"I serve at the will and pleasure of the board," he said. "I understand them not wanting to vote on something they didn't have in front of them." 

 

Even Columbus Chief Operations Officer David Armstrong, who attended Wednesday's meeting, said he understood. 

 

"I'm disappointed they didn't approve the agreement tonight, but I feel what they are asking for is fair," Armstrong said. "That's a reasonable request." 

 

 

 

Festivals still an issue 

 

Even when the inter-local agreement draft is finalized, it likely still won't receive unanimous support from CVB board members -- primarily because of the festival funding. 

 

Board member Mark Castleberry said Wednesday he would vote against the agreement because three of the festivals have direct ties to public officials. Specifically, State Representative Kabir Karriem helps organize the Seventh Avenue Heritage event, while Columbus councilman Gene Taylor and Lowndes County supervisor Jeff Smith help organize Southside/Townsend and county supervisor Leroy Books helps organize Juneteenth. 

 

Rissa Lawrence, another CVB board member, voiced opposition to specifying any festival receive money each year -- even if they must first follow CVB application procedures -- because the organization funds other special events that aren't included in the proposed agreement.  

 

"I don't like any of them being (specifically) in there," Lawrence said. "But if some of them are in there, they all need to be." 

 

Wallace, while saying he didn't oppose funding the festivals, honed his concerns on Market Street, which Main Street Columbus organizes. 

 

"My understanding is that Market Street is a standalone event that makes money every year," he said. "So why are we funding them?" 

 

 

 

Joint resolution still needed 

 

The county-wide restaurant sales tax collects an extra 2 percent on prepared food and beverage sales at businesses that generate at least $325,000 annually from those items, although the city, county and CVB have all agreed to request the tax be collected at all food vendors regardless of revenue if it is renewed. Legislators have indicated a joint resolution is required from the city and county for renewal. 

 

For the past 10 years, the tax has been divided between CVB (85 percent) for tourism and the Golden Triangle Development LINK (15 percent) for economic development. 

 

Right now, the city council and Lowndes County board of supervisors have approved competing resolutions for renewal -- the county's dictating the tax money only be distributed to the CVB and LINK. City leaders, however, have said they would rescind their resolution and sign on with the county once they reach an inter-local agreement with the CVB to turn back funds to the city. 

 

If an inter-local agreement is struck, it requires Mississippi attorney general approval to be effective -- a process that can take up to 30 days. City sources, however, have told The Dispatch they would not necessarily wait for the AG approval before sending a joint resolution with the county to the Legislature to renew the tax.

 

Zack Plair is the managing editor for The Dispatch.

 

 

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