HAZARD — The Fiscal Court will vote one more time on a proposed payroll tax for all workers in Perry County. If at least three out of the four elected Fiscal Court officials vote yes to the tax, it will become law, with no further action required. A majority no vote, or a tie, will result in the resolution failing to pass, meaning no new tax on Perry County payrolls, for the time being.
The vote will happen during a special called Fiscal Court meeting at 10:00 a.m. on Dec. 9 in the Fiscal Courtroom. As is the case with all Fiscal Court meetings, the public is welcome to attend.
Here is a brief breakdown of the steps this resolution has followed on its path toward becoming a law.
The Perry County Fiscal Court consists of four elected officials; Judge Executive Scott Alexander, along with three Magistrates; Keith Miller (District 1), Ronald Combs (District 2) and Kenny Cole (District 3). The first vote on the payroll tax, held in late October, resulted in a tie, with Judge Alexander and Magistrate Combs voting yes, while Magistrate Miller and Magistrate Cole voted no. A tie vote kills a resolution. Therefore, no new tax was placed on Perry County workers.
However, the Fiscal Court possesses the ability to bring a killed resolution back to the floor for another try, which is what the Perry County Fiscal Court did on Nov. 15. This time, the resolution passed, with Judge Alexander and Ronald Combs once again voting yes, while Keith Miller stood by his no vote. Kenny Cole voted no the first time around, but in the second meeting, he changed his vote to yes, which secured the resolution’s passage to the next round.
The next round will unfold at the Dec. 9 meeting. A majority yes vote will result in a 1 percent tax placed on all paychecks earned in Perry County, meaning anyone who works inside Perry County’s borders, whether that person is a citizen of Perry County or not, will pay the tax. A majority no vote, or a tie, will once again kill the resolution and stop the tax, for the time being. If the resolution fails to pass on Dec. 9, the Fiscal Court could bring the issue back up for discussion again at a future meeting.
Prior to the most recent Fiscal Court meeting, the Dept. of Local Government visited the Perry County Courthouse. The DLG is an entity operating through the Governor that is designed to advise local governments in Kentucky on budget issues. Alexander claims he called the DLG for advice and assistance. Following their visit, the DLG wrote a letter to the Perry County Fiscal Court, which summarized their conclusions regarding the current Perry County budget crisis. The first paragraph of the letter states,
“Under KRS 68.210, the State Local Finance Officer, within the Kentucky Dept. for Local Government (DLG), is entitled to investigate, examine, and supervise the accounts and operations of all local government and local government officers. After thoroughly reviewing the Fiscal Year 2017 budget of the Perry County Fiscal Court, it is evident that the county’s financial state is not sustainable as it is.”
In the last Fiscal Court meeting, Kenny Cole referenced the DLG’s visit to Perry County as a major influence on his decision to change his vote from no to yes.
“First time this came up, I voted no,” said Cole, “After talking to (The Dept. of) Local Government, they said, it’s our duty to protect this county. I can’t see any other way of doing it right. He said, if you just let it go, people are going to be laid off. I don’t want to see that happen. I don’t want to see taxes. That’s a really big burden on me, but I can’t see any other way around it. If we let it go, and it get’s so bad, they’ll come in and take over, and they’re going to make us do it anyway, or they can find us in contempt is what they told me. So, I don’t see any other choice.”
When Kenny Cole said “they can find us in contempt” he was referring to the fact that elected officials with the Perry County Fiscal Court could possibly be held in contempt and face penalty from the state if they do not take proper steps to make Perry County’s budget sustainable. The DLG suggested a 1 percent payroll tax to solve the problem.
Alexander and Combs have stated that, although they voted yes to the resolution, a tax increase is not something they want to see happen. However, they say the tax is necessary to continue on with county services and avoid layoffs. Alexander also outlined budget cuts that have been made by his administration and the amount of coal severance tax revenue that has been lost.
Miller argued that the county has not made cuts to the budget in key areas he feels are necessary to justify a tax increase. The hiring of contractors by the county government is one area Miller said is excessive and a reason for concern. Miller said some of the county’s spending is wasteful and he does not understand why taxes would increase before the wasteful expenditures are cut. Thus, Miller voted no twice to the new tax. Alexander denies the claim that such spending is excessive and unnecessary.
Members of the public have attended each meeting pertaining to the tax so far. Individuals have asked the court if another form of taxation, such as a luxury tax, could replace the payroll tax, since the payroll tax will only impact working people in Perry County. The Fiscal Court also received questions about how money from the tax might be spent.
The Fiscal Court said the payroll tax is the only feasible option to relieve budget strains in a timely manner. They estimate more than $4 million annually will enter the county’s budget because of the new tax, which is a number confirmed by the DLG, with money split among various public services.
Originally, the second payroll tax vote was scheduled for Dec. 2, but officials decided to postpone that meeting because of Hazard High School’s football game in the state championship. At last report, the second, and possibly final, vote on a 1 percent occupational tax in Perry County remains set to occur at 10:00 a.m. on Dec. 9. As of now, there is no word on whether or not the Fiscal Court officials plan to stand by their votes from the previous meeting or if any of them have changed their minds.
Sam Neace can be reached at 606-629-3243 or on Twitter @HazardHerald.