By approving the measure during its regular meeting Thursday night, the Cartersville City Council ensured the city will get its share of county tax dollars from energy used for manufacturing.
Bartow County Commissioner Clarence Brown had recently approved the two percent tax on energy used for manufacturing, as allowed under a new state law. While manufacturers will continue paying the two percent tax toward the county and its municipalities, the state is slowly repealing its own four percent tax in a move to attract investment dollars.
During the council’s work session, City Manager Sam Grove was able to provide an estimate of how much revenue the tax provided Cartersville and Bartow County. Cartersville would likely receive approximately $386,248 while Bartow County could receive an approximate $1,313,244.
Mayor Matt Santini believed Cartersville could have found a way to compensate for losing that revenue if the tax was not approved, as a complete tax exemption would likely attract additional businesses to the city. However, he noted that Brown approved the tax because the county needed the additional revenue.
“This is one time that the county getting 69 percent of the sales tax does not work in their favor. It would be easier for us to absorb [the loss] than them,” he said.
By entering into an agreement with the county, the new law requires Cartersville to collect the tax and send it to the state so the funds can be sent back as part of the Local Option Sales Tax and Special Purpose Local Option Sales Tax funds distributed to the city.
Grove and Cartersville Electric System Director David Myers said the collection process would be difficult because there is no way for the city to identify how much electricity a business uses in the manufacturing process. The city will be dependent on how a business reports their energy usage. The collection process also will require the city to create a new tax collection mechanism, which provides an additional difficulty.
While the difficulties displeased Grove, he believed there was no other option than to approve the agreement.
“I will make no secret of the fact that I think this is flawed legislation,” he said. “I think in time it will become something that will be viewed as [a Freeport Tax]. That said, I don’t think we’ve got any choice but to approve this. It would be foolish for us not to take the money. If we don’t take it, it will be taken and split up among the county and the other cities and they will essentially take the money that would otherwise have gone to us.”
The council also heard the first reading of an amendment to the electric rate ordinance. For the past year the CES has worked on revising the electric rates for residential, various commercial businesses and industry. While the revision will result in increased rates, Myers said he was working to keep the price increases as low and as fair as possible.
Such an increase is necessary due to increased costs and possible environmental compliance and nuclear plant construction fees.
The original proposed increases were based on the department’s cost to generate electricity, but were deemed too high by some local businesses. Grove said met with business representatives and negotiated new, settled rates that satisfied both the city and local businesses.
Myers, though, said he could not recommend the settled rates.
“I would not deem it fair,” he said.
He explained how the settled rates would put the CES on par with Georgia Power and eliminate the pricing advantage Cartersville has historically enjoyed with its electric utilities. Myers also said he was not pleased with the way environmental compliance fees and nuclear plant construction fees were incorporated into the settled rates.
Grove said he would continue to work with Myers and local businesses to find a compromise before the next city council meeting.
Other city council business included:
• Hearing the first reading of an amendment to the Animal Control ordinance.
• Hearing the first reading of an amendment to the fiscal year 2011-12 budget.
• Approving a contract with Wideman and Singleton to design filters for the water treatment plan in the sum of $58,260.
• Approving the purchase of 135 Etowah Drive in the sum of $90,700 so the structure may be demolished.
• Approving the purchase of ActiveNet software for the Parks and Recreation Department.
• Approving the renewal of UHC Medicare Advantage insurance for retired city employees.
• Approving the purchase of window treatments for the Public Safety Headquarters in the sum of $16,375 with a 25-year warranty.
• Approving the instalation of a new fiber-optic line in the sum of $25,383.
• Approving a contract with SiteMed to perform the Cartersville Fire Department’s required physicals in a sum not to exceed $22,000.
• Approving repairs to a 2008 Mack garbage truck in the sum of $10,854.14.
• Approving the modification of a CES bucket truck in the sum of $19,097.34.
• Approving additional repairs to the CES bucket truck in the sum of $7,530.09.
• Approving the instalation of attic insulation for the CES building in the sum of $6,764.
• Approving the purchase of a new transformer in the sum of $6,259.
• Hearing the monthly financial statement for August 2012.
The Cartersville City Council’s next meeting is scheduled for Nov. 1 at 7 p.m. at city hall.