September 23, 2014

A reader, who wished to remain anonymous, offered a pretty good suggestion on how the city of Blytheville should handle repaying the unpaid trash and sanitation excises taxes.

A reader, who wished to remain anonymous, offered a pretty good suggestion on how the city of Blytheville should handle repaying the unpaid trash and sanitation excises taxes.

He wrote: "The city should IMMEDIATELY stop using the profits they made from the IRS tax for paying current payroll taxes, and set aside any remaining balance (if there is any) to pay for the sales tax 'error.' We should be able to vote to re-designate the balance and thereby preventing the city from raising our taxes again."

That seems reasonable to me -- so reasonable that it probably won't happen.

From what I understand, the city leaders could call for a special election to ask the voters to change the use of those funds from payroll taxes to excise taxes -- or whatever else they choose.

From Joe Citizen's perspective, that would seem to be a no-brainer. After all, there are plenty of folks upset that the city profited from failing to remit payroll taxes in the first place.

As of Sept. 10, there was $341,779.40 in the payroll taxes account -- down from $571,543.52 on Dec. 31, according to city records.

The city has been paying current payroll taxes with the money because that's all the ordinance allows.

Now, there has been no estimate on how much the city will owe in excise taxes, after paying only a small portion since 2004.

Though it appears Blytheville will only be responsible for the last six years and that the state won't tack on penalties and interest, I suspect -- and it's just a guess -- the city will owe a few hundred thousand dollars.

Blytheville isn't exactly flush with cash, so the money will have to come from some place. One would think that there will have to be another revenue stream.

With the county seeking a half-cent hospital tax -- which would give Mississippi County the fourth highest county tax rate in the state at 2.5 percent, by the way -- and the county potentially asking for a 1-cent tax for a new courthouse (though there has been no official proposal), a new city sales tax would really drive away potential businesses, hurt current companies and, most importantly, be painful to taxpayers.

A tax increase would be a big burden on the citizens, a lot of whom live paycheck to paycheck or rely on government assistance.

Freezing the payroll tax money and asking patrons to change its use is certainly worthy of discussion.

With the election only a few weeks away, it might even generate a few political points for those running for office. Just a thought.

Whoever wins the upcoming Blytheville mayoral election will have a full plate with the excise tax issue and potentially owing the county several hundred thousands for jail fees, if the city loses the lawsuit.

Now is the time to come up with a plan to pay the excise taxes; a contingency for the jail fees probably should have been done already.

But I digress.

The reader's suggestion seems to be a viable solution to yet another tax issue. Hopefully, city leaders will deem it worthy of consideration.

mbrasfield@blythevillecourier.com

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