The News Courier in Athens, Alabama

Local News

October 28, 2012

City councilman points to utility fee as county tax

(Continued)

How much?

Initially, the 1 percent tax/fee was generating about $500,000 a year for the commission from gross electric sales, which at the time were about $50 million, Scroggins said. Today, gross sales are at about $95 million, he said, which means the tax is generating about $950,000 for the commission.

Last fiscal year, the county received $826,939 for the utility fee, Ball said.

“All of it was applied to the debt,” she said.

The utility fee was earmarked for the construction of the new jail and Clinton annex, and cannot be used for any other purpose.

The legislative act authorizing the 1 percent tax was specifically tied to the general obligation warrants (the municipal bonds), so the money could only be used for construction of the new jail and the Clinton Street Annex, Ball said.

Could the commission try to extend the debt or redirect some of the utility fee to pay for the jail expansion or some other project in the future?

No, the money cannot be spent at the discretion of the governing body unlike some of the money that will be generated by the city’s sales tax increase.

“The utility fee associated with the act cannot be amended,” Ball said. “The Legislature would have to pass a separate act to impose an additional fee for the jail expansion or any other public building construction in the same manner as 2001.”

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