Tax vote fails in Walker County

By ED HOWELL, Daily Mountain Eagle
Posted 8/16/17

Walker County voters, not in a mood to trust the Walker County Commission with any more of their funds, voted 52 percent to 48 percent to reject the commission’s proposal for a 1-cent sales tax Tuesday, bringing the county closer to going bankrupt for the first time in its 193-year history.

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Tax vote fails in Walker County

Posted

Walker County voters, not in a mood to trust the Walker County Commission with any more of their funds, voted 52 percent to 48 percent to reject the commission’s proposal for a 1-cent sales tax Tuesday, bringing the county closer to going bankrupt for the first time in its 193-year history.

The commission’s chairman indicated last night the next step is to go to the county’s legislative delegation for solutions, indicating it is now up to them. He raised the possibility that one solution could be to give the commission limited home rule to pass a tax on its own, although he did not say what type of tax that might be.

Voters rejected approving $7 million in annual revenue, the first sales tax revenue that would have gone to the commission to use for General Fund needs. The county’s current 2-cent sales tax all goes for education.

Unofficial results with all precincts in except provisionals show that the tax was defeated by a vote of 6,564, or 52.1 percent, to 6,034, or 47.9 percent.

Turnout was 27.22 percent with 12,655 people reported turned out to vote in the tax referendum and the U.S. Senate primary races. The county has 46,491 registered voters. Officials said not enough provisional votes were cast to make a difference.

While officials vote totals were slowly coming into the main hall of the Jasper Civic Center, supporters for the tax were in a side room, collecting vote totals from calls coming in to them.

They informally wrote down the totals on paper table clothes spread across tables.

Reports showed the Jasper Mall totals were for the tax, 470 to 341 and 172 to 122. Dora also approved it 222 to 194. Absentees would also go for the tax, 104 to 52.

However, it quickly appeared that rural boxes were going against the tax on most counts. Sumiton went against it, 288 to 242 and 55 to 38. Once Farmstead came in at 7:50 p.m. with negative votes, 73 to 63 and 481 to 437, most officials knew the vote would likely go against them, leaving them to wait for the official results.

Commissioners are now faced with the hard fact that after six months of pushing the sales tax as a solution to financial woes that have been building up for 15 years, the commission is still left with a $1,397,000 deficit for Fiscal 2018, which begins Oct. 1.

Even after an estimated $7 million in budget cuts going back to 2013, the commission is facing bond issues that were criticized more than a decade ago and that have already been refinanced one. None of the commissioners were even in office when the debt was created.

Now, the principal on the refinanced bond issue, dated 2013, is due Feb. 1, and, with interest, the county owes $1.5 million spread out in February and August payments. That amount will roughly be owed each of the next 15 years.

The enabling legislation for the tax, which was passed by the Legislature earlier this year, called for the annual debt to be paid first from the tax. Then the revenue would have been allocated (in order of priority) public safety, certified volunteer rescue and fire departments and economic development.

After those allocations were made, 10 percent would have been given to municipalities for their road and bridge needs (divided by population), while the county General Fund would have received the final balance to use for county roads and bridges. The cities were anticipated to get $470,000 a year, while the county would have received $4.23 million, divided equally between four districts.

Losing the road money is expected to bill a bitter pill for the commissioners, who noted how coal tax revenues have dropped off in recent years, so that commissioners could barely patch roads. They said some roads might have to be turned into dirt roads if the tax failed to pass.

However, bankruptcy could have the major impact, as commissioners were warned by officials from across the state to avoid that if possible. Commissioners said bankruptcy would happen if the tax failed.

Commissioners said bankruptcy would hurt economic development and result in major layoffs and service cutbacks. Hiring freezes, elimination of overtime and a budget decrease of up to 25 percent for the coming year were proposed by the county administrator earlier this year, assuming the deficit was still being faced.

County officials late last week were talking about probably having a work session later this week, regardless of how the vote came out, although one has not officially been called yet.

The results came despite a political action committee formed by businessmen to campaign for the tax, taking out billboards, signs and even holding a Facebook Live broadcast on Sunday afternoon. County commissioners campaigned across the county for the tax, and mayors and other officials appeared in favor of it.

No organized opposition was formed. The Chamber of Commerce of Walker County, as well as the Walker County Industrial and Economic Development Board, both came out in favor of the tax.

However, Facebook was flooded with questions and protests, and people indicated they did not trust how the tax would be spent. Even supporters of the tax predicted a close vote. Supporters sponsored a Facebook Live event on Sunday to promote the tax and explain the county’s financial situation.

The proposal also would have eliminated the car and boat tag tax that had paid for the county jail, bringing in $734,000 a year. Even though the jail is now officially paid for, the fee will now stay on the books.

Many residents understood the fee would immediately be removed once the jail was paid for; they were disappointed to find out no previous legislation provided for its cancellation. The enabling legislation for the new sales tax would have done that.

After the official vote came in, Walker County Commission Chairman Jerry Bishop held a brief an impromptu news conference at the civic center.

“I’m very disappointed,” he said. “You always look back and ask, ‘Did we do everything that we could?’ You can’t go on second guessing.” He congratulated those who voted down the tax, saying they are citizens as well, and he also thanked those who worked for the tax.

Bishop — a former businessman who only took office late last year — indicated that the next move would probably be up to legislators, as the commission has no power on its own to raise taxes.

“A sales tax is hard to do. We don’t have any power to raise a tax, so our people had to vote on it, and they voted no. Now, we’re going to pass it on to our legislative body. They have the power. Let them do something with it, or they will be facing this bankruptcy or default, whatever you want to call it, come February.” 

As for temporary measures, such as layoffs or cutbacks, Bishop said it is now time to work on the Fiscal 2018 budget which starts Oct. 1, and those items will be looked at. “It could come down to that. It is according to what the legislative people want to do. We’ll talk to them. We’ll pass this on to them and say, ‘It’s up to you,’” he said.

Asked about the possibility for bankruptcy, Bishop said, “I don’t know what the legislators are going to do. I can’t answer that question. We will default if we don’t do something about it because you can’t continue to pay for things with money you don’t have. That’s government. It’s not like a business. I found that out the hard way. I can’t run a bankrupt business, so I can’t run a broke county. You have got to have the revenue.

“Our citizens didn’t understand it. They may if the Legislature passes something. They can give us a limited home rule, just to pass a small tax. We don’t have a tax. That is a misconception. We have a 2-cent sales tax that goes to our Education Fund. But the county as a whole does not receive a sales tax,” operating instead on property taxes.

Bishop said the commission will not hold a special meeting before its next scheduled meeting on Monday. “I’m sure I will get some phone calls,” he said.

Asked to the biggest factor that led to the defeat, he said it was hard to say, noting supporters all worked hard.

“We knew it would be a close race. There was never any doubt,” he said. “But some people just cannot bring themselves to face reality. But I’m not downing nobody. Who wants a tax? I didn’t want one, either, but I saw that was the only way to get one, to get this county back on a financial basis, and let the people vote for it. I told them when I ran for office they could vote for it. Well, they voted. So that’s where we are at. But again, I’ve got to pass it on to our legislative body and see what they want to do about it. It’s theirs.” 

Roger Wilson, who chaired Walker County at a Crossroads, a political action committee that campaigned for the tax using private donations, said he was surprised at the vote, noting he had a good feeling about the vote over the previous two days after talking with a number of people.

“It was hard to get a feel for it, but I felt pretty good. I’m disappointed,” he said. “I’m terribly disappointed because there was a group of us and we worked really hard.” 

He said he thought the group gave good facts out to the people, and he commended the Daily Mountain Eagle for its coverage of the issue. He said the newspaper didn’t take sides in its reporting, but “just put in the facts in there,” he said.

Wilson said the group did a good job of making people aware of the consequences of the financial situation and benefits of the tax.

“But the candidate we had, Mr. Tax — that’s a tough subject,” he said. “I’m disappointed. We have some good commissioners and we have a good chairman. I hope they have a Plan B. I don’t know what that is. I really don’t. I’m disappointed, but I’m not going to leave. I’m here to stay and I’ll be in Walker County.” 

He said it was disappointing because the thinks Walker County is on the brink of doing some great things, but now there is no funds obtained for industrial development and for securing the courthouse. He said roads now will likely continue to deteriorate.

Moore, Jones

do well in

local Senate vote

In the U.S. Senate races, Doug Jones easily won the Democratic primary in Walker County, with 1,011 votes, or 61 percent of the vote; Robert Kennedy Jr had 338 votes, or 20 percent. In the Republican primary, Roy Moore led in the county with 4,958 votes, or 46.86 percent, followed by Sen. Luther Strange, the incumbent, at 3,735 votes, or 35.3 percent. U.S. Rep. Mo Brooks was third with 1,181 votes, or 11.16 votes.

Trip Pittman was fourth with 537 votes, or 5 percent.

Of all the ballots cast, 84 percent were Republican ballots, amounting to 10,648. Democrats had 1,732, or 14 percent. A total of 275 ballots, or 2 percent, only involved the tax referendum.