July 8, 2013

Mayor grateful for extra tax money

Rising costs instigate city’s larger percentage

By Nita Johnson
Staff Writer

LAUREL COUNTY, Ky. — The rising costs of operation instigated city leaders to request a larger portion of the county’s occupational tax revenues — a request approved last week by the Laurel County Fiscal Court.

That raise in the city’s revenue leaves London City Mayor Troy Rudder and members of the London City Council grateful in more ways than one.

While Laurel County Judge Executive David Westerfield said the loss of revenue for the county would “hurt us pretty bad,” he realizes that in order to maintain the spirit of cooperation between the city and county governments, sharing the wealth is a must.

Ditto for Rudder, who said that continuously rising costs for the city resulted in the request.

In the past, the city received 25 percent of the occupational tax collections. But even after a hike in garbage rates for city residents, Rudder and city council members realized that more money was needed to maintain the city’s operational costs. The newly approved increase will add between $300,000 to $400,000 to the city’s budget each year.

“We raised the garbage rates and tried for five months not to pass it on to the city residents,” Rudder said. “Everything from gas to equipment and garbage disposal has gone up.”

In fact, the costs of dumping the city’s garbage has jumped from $24 per ton to more than $30 per ton. That, along with roller coaster gasoline prices, increases in the costs of equipment, blacktop and other services prompted Rudder and city council members to approach Westerfield and magistrates regarding the split of the occupational tax monies.

“We (the city) generate the majority of the money. We made our case to the (fiscal) court and they felt we had the need and deserved more (percentage of the revenues),” Rudder added.

The split of the occupational tax money will be used “in every department in the city,” Rudder said. “We are like everyone else. We need money to operate.”

That need resulted in a five percent increase in the city’s share of the occupational tax, bringing its share now to 30 percent.  The new agreement was mutual, Rudder said, on both the county’s and the city’s part.

“We asked, we did not demand,” Rudder said. “It was a cooperative agreement between the city and the county.”

Rudder said former city and county leaders had almost come to blows over the division of the one-percent tax paid by anyone who works in  a Laurel County business, resulting in the city enacting its own ordinance for a one-percent occupational tax.

“To become an ordinance, we have to have two public readings and a publication (newspaper of record in that particular town). We had the two readings and enacted it, we just didn’t publish it,” Rudder said.

Rudder said the city and county resolved that disagreement, but the ordinance stands ready should the situation ever change.

“The ordinance was a safety net for the people of London. The last seven years, especially the last three, have been very good for the working relationship between the city and county,” Rudder said. “If the county needs some equipment or some help, we send someone to help them. If we need something like equipment or help, they help us.”

However, in the event the two governing bodies cannot resolve the issue, Rudder said the city would enact its occupational tax rates that would apply to every person who works in the city limits.

“Then those who work in the county would pay the occupational tax to the county and those who work in the city would pay to the city,” he said.

Until — and if —  that time comes, however, the city and county government officials remain cooperative with each other.

“We are most appreciative of the county, for seeing what the city is going through and helping us,” Rudder said.