Opp could repeal city tax
Published 12:18 am Wednesday, November 4, 2009
If the Covington County Commission passes a 1-cent sales tax increase, the city of Opp will repeal its existing additional 1-cent city sales tax, Opp Superintendent Michael Smithart said Tuesday.
Covington County’s three school systems are expected to ask for a 1-cent county tax increase for education at the commission’s Mon., Nov. 9, meeting.
In July 2007, the Opp City Council approved an additional 1-cent city tax, increasing Opp’s total sales tax to 9 percent. The additional tax was passed to help fund the $10 million bond issue for a new Opp Elementary School. Smithart said that 1-cent city tax would be repealed if the commission passes a county tax increase.
He said that in an average year, the Opp City Schools receives about $600,000 from the city tax. Under a 1-cent countywide increase, the OCS would receive about $850,000.
“If there was an increase in the county sales tax, it would more than cover what we’d lose by repealing the city’s 1-cent tax,” he said.
Opp Mayor H.D. Edgar confirmed the city tax would be repealed if the commission were to approve an increase in the county tax.
“When we passed the increase in the city, we agreed that we would take it off the books if the county later voted to pass an increase,” he said.
Smithart explained the 2007 city tax currently meets the school system’s debt obligations, but does not provide any additional revenue for general operational costs. A countywide tax would generate approximately $250,000 more a year, and it’s money that is needed by the OCS, he said.
“The problem is that when you have proration, all of a sudden you’re really cut back in terms of your operating money,” Smithart said. “With a county tax, we’d have additional money that we could then use the way we need to use it. We’d still pay off the OES debt, we’d just transition it to the county tax and still have additional operating money left over.”
According to the 2007 ordinance, the city tax remains in effect until it is either repealed or until the school system’s debt is paid off. Any repealing ordinance would require a first reading in a city council meeting, followed by a vote in a later meeting.