TOMPKINSVILLE — A decision was made during a special-called Tompkinsville City Commission meeting Thursday to increase the city's occupational tax from 1 to 1.5 percent.
City commissioners had considered increasing the occupational tax to 1.75 percent, and had approved an ordinance on first reading in October to do just that. But when it came time to for the second reading, Mayor Scotty Turner presented the city commission with a proposal to increase the occupational tax by 0.5 percent rather than 0.75 percent.
“I know there's been a lot of discussion and concern about increasing it by .75 percent. In doing that it would increase the payroll tax to the city. Currently, we get $638,924.35 per year. With a 0.75 percent increase that would increase the income to the city to $479,193.26 for a total of 41,118,117.61 (for the year),” he said.
“We've discussed the possibility of doing a half percent right now to see if that will offset and help where we need the help right now.”
Increasing the occupational tax by 0.5 percent will generate $319,462.18, making the total income from the tax for the year at $958,386.53.
The mayor continued that he thought the 0.5 percent is a more feasible option.
“Later on, worst case scenario, if we have to raise it another 0.25 percent later on we could do that,” Turner said. “Like we said at the last meeting, it's hard to put a 0.75 percent increase on because it will be hard for it come off. … If I'm sitting here, I can promise you it will come off, but I can't promise you I will be sitting here in two years. The next mayor who comes in may not see things the way that I see it.”
He continued that if the city already has a 0.75 percent payroll tax on the books, he is certain the next mayor will want to keep it.
“Once people get used to paying it they're not going to fuss because it stays the same,” Turner said. “I think that is the best avenue of approach at this time is to just do the half percent. I know it affects every single person in this room. Especially you business owners. It affects every employee that you have. This hasn't been an easy decision and I think all of you know that.”
The occupational tax has not been increased since it was established, which was in 1996, he said.
Turner then asked if there was any discussion on the matter, and Tonya Anderson, a member of an advisory council to the city commission, said at a past commission meeting business owners had asked the mayor to explain why there is a need to increase the occupational tax and how the income from it will be used. She also said business owners had asked the mayor to show how he was going to cut some costs.
“I think none of us were against the increase if you can show us where you have made some cuts on a few things,” she said.
Prior to Thursday night's meeting, the city commission had taken action to reduce its police force down from 11 as a cost-savings measure.
Turner told Anderson they would get to discussion regarding the cuts later on in the meeting.
“The majority of this money is going to pay our suppliers off and everything. It's just going to catch us up on some of our debt that we have,” Turner said, adding that the cost of supplies goes up each year.
In an earlier interview with the Glasgow Daily Times, Turner cited losing water customers to the Monroe County Water District as one of the reasons for increasing the occupational tax. The water district had been a customer of the city's water department prior to building its own water treatment facility.
Turner also said during the meeting that with the city is coming to place that it will soon be able to start replacing some of its sewer and water lines.
Turner pointed out that 43 percent of the city's gas lines have been redone in the last three years, but said the city still has a lot of steel gas lines that need to be replaced. The city doesn't have anyone on staff who is certified to weld the steel gas lines should something go wrong, he said.
The mayor also said that he will be looking into applying for grant funding and low-interest loans available to counties that qualify for Appalachian Regional Commission funding, and said it is possible the city commission will have to consider a monthly stormwater fee to help cover the cost to replace the lines.
Tony High, also a member of the advisory council, asked if the increase in the occupational tax will be sufficient enough to balance the city's budget, and Turner said with the budget cuts the city is making that it should.
The mayor continued that the city commission is starting to hold people accountable for what they are doing and that it is starting to make some changes.
“It took a while to get into this shape and it's going to take us a while to get out of it,” he said. “This will be a big step in that direction.”
He also said that if the city can get out of debt with the increase in the occupational tax then the commission can look at reducing it.
The commission is scheduled to consider adopting the ordinance increasing the occupational tax on second reading at its December meeting. The new occupational tax rate will go into effect in January.
The city commission also approved on second reading an ordinance increasing the city's business license fees, which Turner said had not been increased since 2003.
With the new ordinance, business owners will pay double the amount of what they had been paying for licenses. The amount will be based on their annual gross sales from the prior year as determined by their income tax returns.
If business owners don't produce an income tax return, they will be required to pay the maximum amount for a business license, which is $2,000.
The new business license fees will also go into effect in January.
As far as making budget cuts, the city commission voted later in the meeting to outsource its residential sanitation service to TDS LLC at a rate of $18.50 per month and to suspend the city's recycling service for a period of three months.
There was also discussion concerning the dispatch service for the Tompkinsville Police Department.
Commissioner Anita Bartlett, who oversees the police department, said she thought the city needed to keep the service.
“I don't think we need to get rid of them,” she said.
The city employs four full-time dispatchers and two part-time dispatchers.
Bartlett said the dispatchers do a good job.
No action was taken regarding the dispatching service for the police department.
The city commission also met in closed session to discuss personnel and litigation. After returning to its open session, the city commission agreed to hire another person to work full-time at city hall as a billing and tax clerk at a rate of $9 per hour and it agreed to rehire a police officer who had previously resigned at a rate of $12.50 per hour, Turner said.