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County moves on energy excise tax

Some residents object to measure

POSTED: December 21, 2012 11:29 p.m.
 

Forsyth County commissioners on Thursday approved the local levy of an excise tax that will no longer be collected by the state.

The sales tax on energy charged to manufacturing businesses is being phased out by the state over four years, but legislators allowed local governments to enact the tax locally, phasing in 25 percent of the collections each year.

Along with the state portion of the tax, the law eliminated the two 1 percent sales taxes local governments collect as part of the local option sales tax, which reduces reliance on property taxes, and the special purpose local option sales tax, which funds special voter-approved projects.

Commissioners voted 4-1, with Todd Levent opposed, to enact an ordinance that will allow the county to collect the tax beginning in 2013.

The county entered into an agreement with the city of Cumming in September that the two will collect the tax and split the proceeds according to the agreed upon LOST and SPLOST percentages.

The current LOST agreement directs 85 percent to the county and 15 percent to the city, while the current sixth SPLOST grants 95.71 percent to Forsyth and 4.29 percent to Cumming.

The county will also receive a 1 percent administration fee from the city for its work in collecting the tax, said County Attorney Ken Jarrard.

Forsyth agreed to implement the tax in the agreement, Jarrard said, but could do away with it next year or any time in the future if desired.

Commissioners hinted at that notion during the meeting Thursday, as they granted approval with the requirement that staff return in May with a full report on the collections.

Information has been limited on how the tax will impact the county or local manufacturers.

Based on those unknowns, some residents spoke during Thursday’s public hearing against the measure.

Hal Schneider, who is also chair of the Forsyth County Tea Party, posed several questions that he said haven’t been answered. They included the cost to the county to collect, how much revenue will be generated and a lack of criteria for who will pay.

“What is the rush?” Schneider asked. “Wouldn’t it be more prudent to wait until the county has completed its due diligence and planning before implementing this tax if it so chooses?”

Resident Jeanne Latiolais expressed concern about the “vague nature” of the ordinance.

She also noted that the state is doing away with a tax that Gov. Nathan Deal called a barrier to bringing in manufacturing businesses.

“Why would we as a county want to impose this barrier?” Latiolais said.

In the meantime, the tax will take effect in 2013 and notices are being sent to businesses the county has identified as energy providers.

“It’s a little bit of an inexact science,” Jarrard said. “To the extent we send notices out to entities that don’t do that, I’m sure they’ll let us know.”

Finance director David Gruen said the county plans to collect it similar to the hotel/motel tax, in which businesses provide reports.

Gruen has estimated in the past that the tax could include more than $1 million in revenue in the next round of the 1-cent sales tax collections, which begin in July.

 

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