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Councilman asks for private meeting

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Court votes to break occupational tax agreement

By Calen McKinney

The County has taken the first of two steps in breaking its occupational tax agreement with the City.

But before the Fiscal Court meets again Tuesday, April 14, a group of magistrates and Campbellsville City Council members are expected to meet and could come up with a different solution to solve the County's budget issues.

And that meeting could be closed to the public, which the News-Journal believes would be illegal.

A discussion of budgets is not a stated exception to the Kentucky Open Meetings and Records Law.

The County's 2009-2010 projected budget shortfall was again the topic of a special Fiscal Court meeting Monday night.

Before the discussion began, Taylor County Judge/Executive Eddie Rogers welcomed the crowd of about 25 people but said they would not be allowed to participate in the night's discussion.

Rogers told the Court that he received a hand-delivered letter on Friday from Campbellsville Mayor Brenda Allen, asking that the County raise the occupational tax rate from 1 to 1.25 percent, and that the County keep 80 percent of the increase and the City receive the remaining 20.

Allen's letter states that after discussing the issue with several City Council members, she and the Council believe that a .25 percent increase for two years could raise enough money to balance the County's budget.

According to Occupational Tax Clerk Sherry Kerr, a .25 percent increase in the occupational tax rate would bring in $700,000 more revenue each year. Eighty percent of that figure is $560,000. The remaining 20 percent is $140,000.

Based on the 2007 average household income of Taylor County residents ($35,012), such an increase would cost each household $87.53 more than the current rate.

At 1 percent, she said, the average household in Taylor County pays $350.12 per year. At 1.25 percent, that figure would be $437.65.

Rogers said the Court has heard several proposals as to how to solve the County's jail budget shortfall and all have been criticized by the City.

He said he has heard that if the County terminates the agreement, the City will turn over operation of Rescue and E-911 to the County. If that happens, he said, the County would operate them but evaluate all departments for overstaffing.

"We have extended the olive branch repeatedly and, gentlemen, at this time, my recommendation to this Court is to break the current interlocal agreement, effective June 30," Rogers said. " ... Things have not been distributed equally for some time and the County cannot continue to fully function under our current agreement."

Rogers said he received word Monday that the County will receive less money from state road aid and license funding, and the road department will be $124,875 short for the 2009-2010 budget year, which worsens the County's financial position.

In response, Magistrate James Jones said he would like to discuss other options.

"It's one of these things that you're damned if you do and damned if you don't. No matter which way we go, there's going to be criticism in any step we take."

Jones said he believes the County has come to the point where there are only four options. First, he said, breaking the occupational tax agreement, he said, would give the County twice as much revenue as it has now. On the other hand, he said, City officials have said they can't operate without occupational tax revenue and could have to levy an additional tax.

On Tuesday, Allen said that could likely be the case, which would mean those who work within the City limits would pay two 1 percent taxes instead of one.

Second, Jones said, the County could borrow the money, which would solve the current problem but dig the County deeper in debt.

A third option, he said, is to renegotiate the occupational tax agreement, which the City has said it is not able to do.

The final option, he said, is the one no one wants to talk about - raising the occupational tax rate.

He said he has been told that if that happens, he will not be re-elected.

"Well, you know, if that's the way the citizens of this county feel, then so might it be. I've got to do what I think is right."

If the Court chooses to increase the rate, he said, he is disappointed to learn that the City would ask for 20 percent of the increase.

"Don't hit us between the eyes when you know we're trying to find a solution to a very difficult situation," Jones said. "I would urge you to come back to the plate and say ... forget that 20 percent."

Magistrate Richard Phillips said he wants to pursue borrowing the money to balance the budget.

"We cannot borrow money to put in to balance the budget to start with," Rogers said in response. "But KACo will work with us ... but, again, that's another band aid that we're looking at."

County Treasurer Melissa Williams said even if the County did reach an agreement with KACo, because of the shortage in the road fund, the budget would still be short by about $300,000.

Magistrate Matt Pendleton said he believes raising taxes is not an option and he believes that there is a way to balance the budget without doing so. He said he agrees with Rogers' recommendation and said the Court should discuss who should operate Rescue and E-911.

"After all, they are countywide services and should be funded and overseen by County government."

Pendleton said the County currently has no control over how the City spends the occupational tax funds it receives.

"That's borderline taxation without representation," he said. "Borderline. I'm not saying it is ... If somebody asked me where the tax dollars are going, in that retrospect, I do not know. I can't tell them how they're being spent."

Rogers asked if anyone else had any comments and looked toward Magistrate Milford Lowe, who said, "I'm gonna pass tonight, Judge."

Rogers then asked if any magistrate had a motion they would like to make.

City Councilman David Nunery asked if he could make a few comments.

"At this time, this is just our budget discussion. I don't want to be rude to you," Rogers said in response.

Nunery said he would like for a few members of the City Council and Court to meet face to face to clear up some misunderstandings.

" ... At some point, we've got to be able to sit down face to face and have some candid discussions that are off the record in an effort to come to some understanding and to make sure we see each other's points of view."

Rogers interrupted Nunery and said, "We've already done that. We've already formed a committee and we've already been through that."

Nunery said that hasn't really happened.

" ... It's always been in the context of an open meeting and it's just difficult to have that discussion."

Rogers said committee meetings are by their nature open to the public.

Nunery said he isn't talking about forming a committee, only a meeting between a few City Council and Court members.

Rogers again called for a recommendation or motion.

Pendleton, who said he believes any meeting should be open to the public, made a motion to follow Rogers' recommendation. He also said magistrates should meet with a few City Council members to discuss other options. Lowe seconded.

Magistrate Ed Gorin asked if it would be OK with Nunery if the discussion is open to the public. Nunery said he believes it would be better if it is not.

After the meeting, Allen said she would also be in favor of the meeting being closed, if it is legal.

On Tuesday, City Attorney John Bertram said the group's discussion would have to be declared a "meeting" if a quorum of either the City Council or Court attends. If that happens, he said, the group would have to give public notice of the meeting. He said the group could then go into a closed session, citing various reasons, including possible litigation and terms of a contract.

County Attorney Craig Cox could not be reached for comment before press time.

As of Tuesday afternoon, Allen and Rogers said they had not heard when a group might meet. Rogers said he would like the meeting to be open to the public.

"If I'm involved, it will be open," he said.

At Monday's meeting, Gorin said he believes Jones, Pendleton and Gaines should attend the joint meeting of magistrates and City Council members.

In a roll call vote, Jones cast the lone "no" vote because he believes the group should meet before the vote.

Phillips said he voted "yes" because he doesn't know any other option.

"I don't know what else we can do. If there's some miracle that happens ... I am publicly asking for it."

- Staff Writer Calen McKinney can be reached at 465-8111 Ext. 235 or by e-mail at reporter@cknj.com. Comment on this story at www.cknj.com.