Crossville Chronicle, Crossville, TN

July 18, 2013

City supports sales tax legislation

By Jim Young
Chronicle correspondent

— The Crossville city council approved a resolution expressing support for the Marketplace Fairness Act and fairer application of sales tax now before the U.S. House of Representatives.

The Marketplace Fairness Act requires online sellers to charge and collect sales tax on out of state sales. Current Tennessee law requires residents who purchase out-of-state goods to pay the sales taxes themselves but many don't know of the requirement and few remit as required.

The adoption of the resolution was recommended by Mayor J.H. Graham III, who also made the motion to adopt the resolution. Councilman Pete Souza seconded the motion.

Graham explained his support for the measure by saying, “It is not fair for local retailers to pay property taxes and ad valorem taxes and personal property taxes and get hit by individual fund raisers and be at a 10 percent disadvantage to online retailers as a sales gimmick to save by shopping online.”

Graham continued, “In order to make it a level playing field, we need to tell the House of Representatives to pass this act.”

The motion was approved unanimously by the council.

In another tax related action, the council also approved a resolution opposing a reduction or elimination of the tax exemption on municipal bond interest. Graham read the resolution that outlined that state and local governments finance three fourths of all infrastructure projects though municipal bonds. These projects include roads, bridges, hospitals and utility systems.

The tax exemption saves substantial interest costs and receives an average 2 percent lower interest rate on funds borrowed that has saved taxpayers hundreds of millions of dollars. The resolution encourages senators and representatives to strongly oppose any efforrts reduce or eliminate the tax exemption on municipal bond interest.

Graham moved to approve the resolution and Councilman Danny Wyatt seconded the motion, which passed unanimously.

Souza asked for a discussion of the order of business for council meetings and expressed concern over surprise motions that  he felt should be outlined for council members to prepare for discussion. Souza moved that no motion can be made that is not germane to the agenda item unless a motion is made to amend the agenda.

Graham agreed with Souza, saying, “We need to be more specific in regard to what is put on the agenda and the requirement for legislative action.”

Graham asked who Souza was proposing to decide if the agenda item met the criteria

Souza said that as council sends agenda items to the clerk, “We should be supplying the basic information to the rest of the council.” He added that if it was germane to the item, than a motion could be made.

Graham said he would accept the recommendations of Souza and that will be the operation of the council in the future.

Another item Souza brought up was handling of city funds. Souza said he had discovered that a city manager and an elected official had taken checks to make payments on behalf of the city and that “made him uncomfortable.” Souza stressed, “That's the finance director's job.”

Souza moved the city finance director be responsible for making all payments. Councilman Jesse Kerley seconded the motion.

During discussion of the matter, it was outlined that previous city manager had carried a check across the street to Cumberland County Bank related to purchase of the the new city hall building. In addition,  the early payoff of the purchase of the Interchange Industrial Park could have resulted in a penalty, but Graham took the check to seller Millard Oakley, who returned the funds to the city.

Souza said, “I'm not saying that there is wrong doing. I'm saying that we, as a council and city manager, should not be handling funds.”

Graham said he felt the policy suggested by Souza is already in place and any deviation from that has been approved by council. He asked Souza if he wanted the policy reaffirmed. Souza responded “yes” and the motion passed unanimously.

Brad Allamong, new president of the chamber of commerce, was introduced to the council and talked about his excitement in working for the community. Allamong said he was very pleased to be in Crossville and it was a beautiful community with a lot to offer.