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Talks on sales tax slowing

County ready for mediation

POSTED: August 19, 2012 10:30 a.m.
 

Forsyth County and the city of Cumming have about a week to reach an agreement on a sales tax split before inviting a mediator to settle the dispute.

The governments began direct negotiations on June 27 for a percentage split of the revenue from the 1-cent local option sales tax, known as LOST.

Cumming currently receives 15 percent of collections, and Forsyth gets 85 percent from LOST, which is intended to roll back property taxes.

That 10-year agreement will end Dec. 31, and the tax will continue only if the county and city reach a new agreement.

In a process set forth by the state, the governments have two months from the start of negotiations to reach an agreement independently, which is Monday.

If that cannot be done, then the two enter a nonbinding alternate dispute resolution, also known as mediation, for 60 days.

After hearing an update Thursday from staff on the negotiations, Forsyth County commissioners gave approval to begin seeking a mediator.

County Manager Doug Derrer said senior staff from Forsyth and Cumming have met twice and also exchanged information since the process began.

“The recommendation at this point is for the board to consider preparation to advance to that next phase of negotiations, known as alternate dispute resolution. You may know it as being the nonbinding mediation phase,” Derrer said. “Unless of course you believe an agreement can be reached by the [current phase] deadline, which is Aug. 26.”

He said the negotiations will automatically move into the next phase if a split hasn’t been decided by the first deadline, but the county will want to seek out a mediator who will work with both sides for a resolution.

Derrer said county staff hasn’t reached a recommended percentage split, but the city has suggested between 15 and 25 percent.

“The information that we have today, and to the extent we’ve evaluated, it has not risen to the 15 percent,” he said.

In settling on a figure, the governments review a number of factors, such as services delivered, property tax digest values and planned future needs.

Chairman Jim Boff said the tax digest value of the city makes up nearly 4 percent of the county’s total.

“The idea that we may go into negotiations further is potentially incorporated or insinuated with the possible difference of 3.94 percent versus 15 to 25 percent,” Boff said.

“I’m not saying that’s the only way to look at it, but I’m saying the information provided here, those are two gross, well-defined — although perhaps coarse — data points to look at.”

If the county and city do enter into mediation, the next deadline for an agreement is Oct. 27.

Without an agreement at that time, either side can ask the Superior Court to select one either the city or county proposal before the end of the year.

 

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