Members of the county’s Budget and Finance Committee were told the city wants a bigger share of the money from its successful sales tax litigation against the county.
The county now receives a 2 percent “handling fee” from the money it pays to the city. The city wants to cut that handling fee to 1 percent.
The 2 percent on this year’s $80,000 owed will amount to approximately $1,600. The fee would be cut to $800 if lowered to 1 percent.
While that’s not much in the scope of government, the money the county will be paying the city is increased by $80,000 every year. After 10 years, it will be approximately $800,000. That makes the handling free $16,000 for 2 percent versus $8,000 for 1 percent.
County finance director Linda Hillis said, “The difference in 1 percent could result in a lot of money over the next few years.”
Both the county and the city signed a contract stating, “The Gross Amount Due the City will be reduced by 2 percent for the County’s handling fee (with the result being referred to as the “Net Amount Due the City).” The contract went into effect Nov. 21, 2011.
According to a letter dated Oct. 3 and written by assistant county attorney Rick Stacy to McMinnville city attorney Tim Pirtle, city administrator David Rutherford used an “unprofessional tone and nature of conversation” on Sept. 28 during a telephone call placed by Rutherford to county attorneys.
Stacy said in the letter, “You may recall that it took approximately two years of litigation and an absurd amount of taxpayer dollars to finally arrive at the new agreement.”
He goes on to say, “Initially, Warren County was willing to consider a proposal to revise the New Agreement in a good faith effort to avoid the unnecessary wasting of any more valuable taxpayer dollar on this matter and litigation involving this matter.”
“However, the apparent expectation of the city administrator that the new agreement which involved many hours of painstaking negotiation and much expense could be revised in an instant without careful consideration and official action by the parties is unrealistic,” Stacy said.
Stacy finishes the letter by saying, “Additionally, as you are aware, Attorney General Opinion No. 11-46 was issued on May 19, 2011. Considering that the City of McMinnville and Warren County did not execute the New Agreement until Nov. 21, 2011, a full six months after the opinion was issued, Warren County can only presume that the Mayor and Board of Aldermen were aware of the opinion at the time they approved the New Agreement.”