On June 24, Commissioner Woolsey shared with Chairman Wilder and the other Commissioners the motion she intended make for each agenda item. After passing the 13% tax hike, Commissioners Wilder, Hollingsworth, Kernodle, and Engelman voted to table all four of these agenda items in a single 4-2 vote. Commissioner Woolsey was given no opportunity to make her motions, explain them to the Commission, or respond to any questions or concerns.
At the meeting, then Chairman Wilder said that he would respond to the agenda items on the Commission website. His response has appeared. I appreciate that this response was much more professional and civil than what appeared before. Unfortunately, there are some misconceptions and errors.
The first tabled agenda item was:
Agenda Item 9. Intergovernmental Agreement with the Town of James Island to Reduce PSD Property Tax Burden.
The motion shared by Commissioner Woolsey to then Chairman Wilder and the other Commissioners on June 24 was:
Move that the James Island Public Service District seek an intergovernmental agreement with the Town of James Island for the purpose of reducing the property tax burden on the residents and property owners of the Town by:
a. accepting monies from the Town to partly or wholly fund the provision of solid waste collection and/or fire protection services by the District to the residents and property owners of the Town.
b. agreeing to allow a property tax credit on the county tax bill reducing the amount to be paid to the District for operations by property taxpayers under the Town’s jurisdiction.
What is most important in the Wilder memo is:
"The JIPSD has no interest in being a party to settle the questionable legality of another entity’s proposal."
In other words, the majority of PSD Commissioners are willing to throw away an offer of $1 million dollars without any dialogue or discussion. They would prefer to impose a 13% property tax increase on majority of their constituents -- the residents and voters of the Town of James Island.
The Wilder memo suggests that "the Town should seek a declaratory judgment action to settle the questionable legality of their proposal."
Chairman Wilder is no lawyer, but one would hope that a competent attorney would have reviewed his memo. The Pope Flynn law firm has explained that the Town cannot obtain a declaratory judgement on its own. That is because we do not believe that the PSD must agree to accept our money in exchange for services or provide tax relief to our residents and property owners. Our argument is that a voluntary agreement between the PSD and the Town would be legal and desirable for both parties. Therefore, the only way to obtain a declaratory judgement is to prepare a specific agreement that the JIPSD and Town would support if it were legal, and then have the PSD Commission and the Town Council adopt it pending a determination of its legality. The PSD and Town would be on the same side of the declaratory judgement, claiming that our agreement is legal. Since the benefits of this proposal mostly go to Town residents and property owners, it would be entirely appropriate for the Town to bear the cost of this friendly legal action.
The Wilder memo criticizes this opportunity to provide tax relief because the well-respected Pope Flynn law firm has described the proposal they developed as being "novel" and "not settled law." Novel means new. It doesn't mean bad, speculative or doubtful. Maybe no other PSD has raised taxes so much or perhaps no other municipality cares enough about its taxpayers to be willing to help. "Not settled law," means that this proposal has not been challenged and then determined by a court to be legal That seems to follow from it being new. The Wilder memo provides no challenge to the legal principles argued by the Pope Flynn law firm.
I was surprised by the scare tactics included in the Wilder memo. Most shocking was the claim that the Commissioners or senior PSD employees might be held personally liable for accepting the Town's money in exchange for services or for consenting to a Town tax credit against PSD taxes on the County tax bill. If the PSD worked with the Town to obtain a declaratory judgement, and the courts determined that the proposal was contrary to South Carolina law, there would be no liability to anyone for trying to find out whether it was legal or not. And if it was determined to be legal by the courts, there would be no liability to anyone for implementing the agreement. Further, even if the Town and PSD implemented an agreement without a declaratory judgement (a course not advised by the Pope Flynn law firm,) elected officials and public employees have strong protections against any personal liability for their official actions.
Similarly, as long as no money changes hands before a declaratory judgement, then there is no way that the PSD would have to pay anything back to the Town. Now, if the Town and PSD implemented an agreement without a declaratory judgement, and the Town lost in court, then there is a very slight chance that money would have to be paid back by someone. However, it would almost certainly be the Town that would be responsible for making any such payments. The chance that the PSD would be required to return money used to pay for providing services is negligible. Further, the Town would be more than willing to agree to cover the cost of services provided to our residents by the PSD. That would be fair and reasonable. Still further, even that slight threat can be avoided if the PSD would work with the Town to obtain a declaratory judgement before implementing the agreement.
Finally, I have never said that the Town would use any part of its sales tax revenue to purchase services from the PSD. While I don't think there is any problem with doing so, if that is of concern to the PSD, then the Town could use its other sources of funds to make payments to the PSD. Fortunately, none of our other vendors or suppliers have ever been worried about whether the money they receive from the Town comes from sales tax or some other revenue source. I would also note that the PSD receives more than $1 million per year from the City of Charleston and the City of Folly Beach without ever expressing worry about the source of funds used by those Cities to make their payments.
The Town's offer to the help the PSD by turning a 13% tax increase into a 20% tax cut remains open. All that is necessary is to find a majority of PSD Commissioners willing to work with the Town.
The Wilder memo criticizes this opportunity to provide tax relief because the well-respected Pope Flynn law firm has described the proposal they developed as being "novel" and "not settled law." Novel means new. It doesn't mean bad, speculative or doubtful. Maybe no other PSD has raised taxes so much or perhaps no other municipality cares enough about its taxpayers to be willing to help. "Not settled law," means that this proposal has not been challenged and then determined by a court to be legal That seems to follow from it being new. The Wilder memo provides no challenge to the legal principles argued by the Pope Flynn law firm.
I was surprised by the scare tactics included in the Wilder memo. Most shocking was the claim that the Commissioners or senior PSD employees might be held personally liable for accepting the Town's money in exchange for services or for consenting to a Town tax credit against PSD taxes on the County tax bill. If the PSD worked with the Town to obtain a declaratory judgement, and the courts determined that the proposal was contrary to South Carolina law, there would be no liability to anyone for trying to find out whether it was legal or not. And if it was determined to be legal by the courts, there would be no liability to anyone for implementing the agreement. Further, even if the Town and PSD implemented an agreement without a declaratory judgement (a course not advised by the Pope Flynn law firm,) elected officials and public employees have strong protections against any personal liability for their official actions.
Similarly, as long as no money changes hands before a declaratory judgement, then there is no way that the PSD would have to pay anything back to the Town. Now, if the Town and PSD implemented an agreement without a declaratory judgement, and the Town lost in court, then there is a very slight chance that money would have to be paid back by someone. However, it would almost certainly be the Town that would be responsible for making any such payments. The chance that the PSD would be required to return money used to pay for providing services is negligible. Further, the Town would be more than willing to agree to cover the cost of services provided to our residents by the PSD. That would be fair and reasonable. Still further, even that slight threat can be avoided if the PSD would work with the Town to obtain a declaratory judgement before implementing the agreement.
Finally, I have never said that the Town would use any part of its sales tax revenue to purchase services from the PSD. While I don't think there is any problem with doing so, if that is of concern to the PSD, then the Town could use its other sources of funds to make payments to the PSD. Fortunately, none of our other vendors or suppliers have ever been worried about whether the money they receive from the Town comes from sales tax or some other revenue source. I would also note that the PSD receives more than $1 million per year from the City of Charleston and the City of Folly Beach without ever expressing worry about the source of funds used by those Cities to make their payments.
The Town's offer to the help the PSD by turning a 13% tax increase into a 20% tax cut remains open. All that is necessary is to find a majority of PSD Commissioners willing to work with the Town.
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