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$12.5 million due city by month's end
Funds from county part of sales tax settlement
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Forsyth County News

Christmas will bring a little extra green to Cumming this year as the city is scheduled to receive $12.5 million from Forsyth County before year's end.

It may not be a surprise gift, but after a legal battle that dates back to 2007 both governments are pleased their feud over the 1-cent sales tax extension will have closure.

Voters overwhelmingly supported the Feb. 5 ballot question to continue collecting the Special Purpose Local Option Sales Tax, known as SPLOST VI.

But the city filed suit against the county, challenging the wording on the ballot. A judge ruled in April in the city's favor, dismissing the referendum on the grounds it deprived the city of using its share as officials felt best.

To prevent the loss of revenue while waiting to hold another referendum, the judge encouraged both sides to negotiate a compromise, giving them extra time before his decision would take effect.

In addition to the city's population-based 4.29 percent cut of the tax collection, the compromise they reached calls for the county to pay $10 million toward the city's aquatic center and $2.5 million for any of the city's prioritized construction projects.

The agreement also requires the county pay the city prior to the new year.

Forsyth County Commission Chairman Charles Laughinghouse said he did not foresee any problem meeting this month's deadline.

"The bonds are sold, we just have to make sure the money's in the bank," said Laughinghouse, adding he will be relieved when the money is paid. "I don't like for there to be tension between the city and county."

Bill Thomas, the county's chief financial officer, said $10 million is coming from the Feb. 5 voter-approved parks and green space bond, as indicated in the intergovernmental agreement.

The remaining $2.5 million likely will come from the county's general fund reserves.

The county has about $33 million in its reserves. Thomas said the $2.5 million would be replenished in the reserves once the penny tax yields the minimum estimate of $160 million.

Based on previous spending, the sales tax extension is projected to generate between $160 million and $275 million, the maximum amount allowed under the referendum.

Given the current recession, Thomas said, it is "possible we won't ever collect that [$160 million minimum], then the general fund would absorb that."

"But that's two or three years down the road," he said.

Cumming Mayor H. Ford Gravitt said the city has been working on projects the $12.5 million will fund.

"I've felt all along that it would be paid," he said. "The voters of the county approved the bonds and it's being paid out of the bonds, so ... I had no reservations of it not being paid."