Commonwealth Journal

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February 8, 2013

County, city agree to 60-40 split of tax money


Somerset —

Occupational taxes paid by city entities represent a large chunk of the total amount. City officials have estimated that anywhere from 55 percent to 65 percent of the total occupational tax revenue comes from employers within the city limits, while county officials said that number could be as high as 75 percent. Had the city been able to take amount for themselves, county officials feared the worst would be possible.
“That would have been disastrous to county government had the city done that,” Pulaski Judge-Executive Barty Bullock told the Commonwealth Journal recently. “Thankfully, we came together with the mayor and city council, and members of the fiscal court and myself, and our treasurer and their finance folks, and I think we’ve got a solution worked out to make sure everyone’s taken care of without having to devastate anyone.”
The city needed the money for EMS urgently. Medicare and private insurance coverage led to many EMS bills being unpaid, resulting in a loss around $970,000 on the city’s checkbooks by the close of the 2011-2012 fiscal year, which ended in June. The city council advanced $1.3 million in January to help cover the shortfall, and part of the agreement with the county entails refunding the city about $1 million to help cover that, through June 30. Still, arrangements must be made with an eye to the future.
The new agreement details that the county will maintain exclusive operation and financing of the 911 dispatch system, while the city will continue to handle EMS, even though it operates throughout the county.
There will be no increase in the occupational tax rate, and no worker or business paying any additional fees. What will change is that Somerset will enact an occupational tax rate that, under the agreement, will be an offset against the amount to be generated by the county occupational tax. The expected rate for the city’s occupational tax will be .006.

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