Sunday, December 21, 2008

Oconee Commissioners Set SPLOST Vote

County Offers Some Details on Last SPLOST Too

The Oconee County Board of Commissioners on Dec. 16 took the final two steps needed to give voters a chance in March of 2009 to decide to reduce local sales taxes by a penny on the dollar or to continue paying that tax for another six years.

The Board approved an intergovernmental agreement with the county’s four cities, which will receive $5.7 million from the $40 million in expected tax revenue if it is approved by the voters. The Board also set the election for March 17, 2009.

Two days later, in a required legal advertisement in The Oconee Enterprise, the county gave a bare-bones report on what citizens have gotten for the Special Purpose Local Option Sales Tax, or SPLOST, which has been in place since December of 2004.

The county reported it has spent 43 percent of the $25 million it expects to take in from the SPLOST when it expires in November of 2009–or 53 percent of the $20.4 million the county has collected as of the end of October of this year.

The report in the Enterprise covered spending through the end of June of 2008, meaning the county still has 17 months of spending left.

To put it another way, the county has spent 43 percent of the projected funds, but it has used up 72 percent of the months it has to spend the money.

According to the statement in the Enterprise, which is the legal organ for the county, the county does expect to spend the money by the time the SPLOST expires at the end of 2009. "There are no surplus funds projected for any SPLOST projects," according to the statement.

The Enterprise did not run any story about the legal statement.

The report was submitted by the county’s Finance Department. Finance Director Jeff Benko told me in an e-mail message of Dec. 19 that the report does not reflect the full level of spending to date by the county on authorized SPLOST projects.

Costs are not shifted to the SPLOST account until projects are completed and audited, he said.

The published report shows that $3.4 million of the budgeted $6 million for water and sewer projects had been spent by June 30, 2008, and $3.8 million of the budgeted $5 million for recreational and cultural projects had been spent.

In addition, $1.5 million of the $6 million set aside for roads, $67,000 of the $1.5 million for a fire station, and $167,000 of the budgeted $4.6 million for county facilities expansion and renovation had been spent.

The full $1.3 million of the budget for the jail expansion and the full $600,000 for the Emergency Operations Center already have been spent, according to the report.

The report provides no details beyond these broad categories, so it is hard to know exactly how the county spent the tax revenues in each of these areas.

I suggested during public comments at the end of the first public meeting on SPLOST on Oct. 21, 2008, that the county prepare a report on how the money was spent so citizens could know what they had gotten for the last SPLOST as they evaluated the proposal for another.

County Administrative Officer Alan Theriault told me that Benko was preparing such a report "that has to be presented in the newspaper and he should have that for you in the next several days as a matter of fact." Benko confirmed that the reports for earlier years already had been published and subsequently provided them to me.

At the beginning of the second public meeting on Nov. 3, Board of Commission Chairman Melvin Davis did recite a list of accomplishments of the current SPLOST.

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He mentioned the new jail, the emergency operations center for 911 calls, recreation facilities, fire trucks, renovations at the library, resurfacing of roads and "water and sewer expenditures."

He said Benko could give exact details.

Davis also made an argument in favor of the SPLOST tax. "As most of you know, a great percentage of the revenue we receive comes from out-of-county residents," he said.

When people from Athens-Clarke County or other counties make purchases in Wal-Mart or Home Depot on Epps Bridge Parkway, they leave behind a penny on every dollar they spend for SPLOST projects in Oconee County. Of course, Oconee County citizens also contribute to SPLOST funds when they shop at these and other stores in the county.

Since Clarke also has a SPLOST tax, Oconee citizens give their money to Clarke when they shop there.

Oconee County officials, who are looking for expansion of the commercial base in Oconee County, particularly with the approved Epps Bridge Centre near the Wal-Mart, expect the new SPLOST to bring in more money than the old.

The current SPLOST is projected to produce $25 million over five years, but the county is expecting the new SPLOST to produce $40 million over six. SPLOST taxes must be renewed by voters. To go to the six-year cycle, the county had to agree this time around to share revenue with the four cities in the county, with the ratio based on their population size.

The BOC approval of the intergovernmental agreement on Dec. 16 confirmed that arrangement.

How realistic that $40 million projection is no one really knows, given the current national and local economic downturn. The current SPLOST produced $5.1 million in the fiscal year ending June 30 of 2006, $5.5 million in the year ending June 30, 2007, and $5.4 million in the year ending June 30, 2008.

The county collected a little more than $1,730,695 in the first four months of the current fiscal year, compared with $1,855,978 during this period a year ago. Benko has said he still projects the county will reach the $25 million cap before the current SPLOST authorization expires in November of 2009.

To reach the $40 million figure for the new SPLOST, the county will have to average $6.7 million annually over the six-year run of the tax.

The county clearly is counting on voters to approve the new SPLOST. Funds will be used to pay down the debt on the new park on Hog Mountain Road ($4.8 million) , to pay down the debt on the new jail ($6.0 million) and to provide for road resurfacing ($8 million) and sewer and water projects ($6.8 million).

Other projects are for fire department equipment and facility upgrades, a new communication system for the sheriff’s office, parks and recreation, and farmland protection.

If citizens don’t approve the new SPLOST, the county is going to have to pay for most of these projects from other sources, such as property taxes and the Local Option Sales Tax, which does not require voter approval for continuation and also is 1 cent on the dollar.

The county’s record for approving these local taxes is strong. The SPLOST for $13.5 million in 1999 was approved by 75 percent of the voters. The current SPLOST was approved by 82 percent of the voters.

In 2006, 79 percent of Oconee voters approved a five-year tax of one cent on the dollar for educational purposes.

The 1999 and 2003 SPLOST voters were voted on in special elections, when relatively few voters go to the polls. Only 1,696 people voted on the current SPLOST when it was approved in 2003.

The 2006 educational tax was approved in the state-wide July primary, and 4,110 of the 17,030 registered voters participated.

How many of the 21,579 registered voters in Oconee County will go to the polls in March is an open question. At the general election in November, 17,208 voted.