Friday, July 24, 2015

Report on Special Meeting and Public Hearing

Town Council met on Thursday, July 23 at 6:00.  

There was a public hearing on the proposed budget amendment.   Two people spoke.   The first was  JIPSD Commissioner Kay Kernodle.   She said that she was just speaking to Council (not me.)   She said that the Town should hold several public hearings at several locations on the Island and then have a third reading of the budget amendment ordinance.  

The second speaker was Robin Welch   She said that there were very few people at the public hearing because I kept it secret.   She said that I could try to fool people with my fancy math, but the Town was introducing a new tax.  She said that I had promised never to introduce a tax, but that must have been a lie.   She said that the Town receives $3 million in Local Option Sales Tax money each year. She said that what I wasn't saying is that Mayor Clark sent every taxpayer on James Island a check every year, but that when I was elected the checks stopped.  

There being only two people who signed up to speak, I closed the public hearing.

Council then voted to approve spending $400 to support the James Island Charter High football booster club by paying to have a Town sign on the football field.

Council went into executive session.  Council returned.

Council voted 3-2 to adopt an ordinance providing for procedures to levy and collect a property tax.  There was no discussion.   Stokes, Blank and I voted in favor.   Milliken and Mullinax voted against.

Council voted 3-2 to adopt a budget amendment.   There was no discussion.   Stokes, Blank and I voted in favor.  Milliken and Mullinax voted against.

The budget amendment includes a 20 mil property tax, a tax credit of $2,948,058, expenditures of $840,000 for payment for Town Hall by lease purchase agreement, and $200,000 to maintain a reserve fund.

The amount of the tax credit, $2,948,058 is the amount of revenue the Town has received from the Local Option Sales Tax (LOST) Property Tax Credit Fund since 2012, plus the interest we have earned on that money, plus the amount we expect to get during the 2015-16 fiscal year.

The property tax credit will zero out the property tax liability for all property taxpayers in the Town.   I asked Council to approve this because I believe that it is in the best interest of the Town to deal with LOST tax funds as do the majority of municipalities--by providing a tax credit against our own tax millage.

The millage will appear on the tax bill as will the amount of the tax credit.  However, the amount of tax collected will be zero.    Here is a copy of what the tax bill will look like.  (Most of the figures are from last year, but I updated the figures to show the increase in the JIPSD millage.   Changes in any other taxes on the bill for this year aren't shown.   The Assistant County Auditor verified that what the Town Council has approved will be reflected on the tax bill more or less as is shown.)

While the Town will not be causing any increase in anyone's property tax, I am disappointed that we have not been able to reduce property taxes.   I asked the JIPSD to reduce rather than increase their property tax in the Town and allow the Town to pay them for solid waste collection services by contract.   Unfortunately, the Town's proposal was never even brought up for a vote.

I have not given up, but I have given up for the 2015 tax year.   It is my assessment that there is little hope for a tax cut until after the JIPSD elections in November 2016, and that means the 2017 tax year.   At that time, hopefully there will be some new JIPSD Commissioners who will agree to reduce the taxes they impose on the Town and receive payment for solid waste collection services from the Town by contract.

Since the majority of JIPSD Commissioners refused to take the Town's money for solid waste collection services and prefer to increase the taxes they charge, what should the Town do with the money we would have spent to pay for solid waste collection?   I have agreed with other members of Council that it is in the best interest of the Town to no longer continue to accumulate LOST funds as we have for the last three years, but instead use the $840,000 that we expect to receive during the 2015-16 fiscal year to construct a new Town Hall.  I expect that the Town will do about the same thing for the 2016 tax year--making further progress in paying off Town Hall.

I hope that in 2017, I will be able to find a  majority of Town Council and JIPSD Commissioners that will adopt a plan to reduce the property tax the JIPSD imposes and allow the Town to pay for solid waste collection by contract.

There is a bit more to the story.

After close of business on Wednesday evening, our Town Attorney received an email from one of the out-of-town attorneys helping Trent Kernodle with his lawsuit against the Town.   The email said that if the Town did not postpone its vote on the budget amendment, they would seek a temporary injunction blocking the Town from spending or crediting any LOST funds until their lawsuit is resolved.   (With appeals, this could be several years.)   They insisted that the Town respond by 10:00 AM Thursday morning.   Of course, we refused.  Neither our Town Attorney nor I could agree to postpone a meeting and public hearing that was already scheduled or commit Council to vote to postpone consideration of an ordinance.

Kernodle has filed his temporary injunction.  There will be a hearing before a judge within the next few weeks.   This legal tactic was expected.

And that is why Trent Kernodle's wife and employee, Kay Kernodle, was at our meeting asking Council to hold more public hearings and have a third reading.  Robin Welch, daughter and employee of former JIPSD Commissioner Rod Welch, was there to help.  Rod Welch, along with Sandi and David Engelman, are all helping Kernodle sue the Town.

I think they are desperate to block the Town from providing a tax credit against its own millage exactly as do most municipalities in South Carolina.

Robin Welch, especially, made an effort to round up a crowd to show up to the public hearing.   Well, her sister showed up. 

The point of the suit is to force the Town to "mail the checks."   As Trent Kernodle said at the Mayoral debate, getting a check from the Town is just like Christmas.   He didn't win the election, but he and his political backers still think they can run the Town by lawsuit.

In my opinion, the majority of JIPSD Commissioners are refusing to work with the Town on property tax relief because they support Kernodle.   It is the same reason they refused to sell the Dills Bluff Property for the new library.  It is my understanding that Kernodle told them not to sell, and his backers on the Commission do what he says.

I am disappointed that the Town was unable to get the JIPSD to agree to a plan to reduce taxes, but  I want to assure everyone that the Town isn't increasing anyone's taxes.   Again, I hope that by 2017 the Town will have fought off the Kernodle legal attack and we will have new JIPSD Commissioners who will work with the Town to reduce your taxes.

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