Arbitration clock starts in Walker County, Ga., tax spat

Arbitration clock starts in Walker County, Ga., tax spat

November 5th, 2012 by Tim Omarzu in Local Regional News

Franklin Etheridge

Photo by Andy Johns/Times Free Press.

City and county officials in Walker County, Ga., haven't reached an agreement on how to split millions of dollars of local option sales tax revenue over the upcoming decade.

So on Friday, the negotiation process officially entered the 60-day arbitration stage -- though at least one of the negotiators thinks a judge's ruling won't be necessary to settle the matter.

"We can still reach an agreement just by agreeing," Walker County Attorney Don Oliver said.

The 1 percent sales tax generates $5.4 million annually. Walker County now keeps 80 percent of that, leaving 20 percent for its cities to share.

The revenue goes into cities' and counties' general fund budgets.

LaFayette, the largest city in Walker County and the lead negotiator, hired a consultant who determined the cities deserve a much larger share.

"The data would support a 50-50 split, or something close to 50-50," LaFayette City Manager Frank Etheridge said. "Realistically, the cities understand we can't go from 80-20 to 50-50. We were trying to get to 70-30."

The closest the two sides came was when the county agreed to keeping 73 percent for itself while giving the cities 27 percent, Etheridge said.

Local option sales tax negotiations are going on now around the state.

In what's known as "baseball-style arbitration," the two sides in Walker County -- the cities and the county -- each would submit a proposal. A Superior Court judge would pick one proposal or the other -- not a combination of the two. That's meant to keep either side from overreaching.

"It'll be transferred to a judge out of the region," Etheridge said. He expects the judge would travel to Walker County to make a decision.

Etheridge, Mayor Neal Florence and City Councilman Ben Bradford, who's an attorney, are negotiating for LaFayette; Mayor Bill Glascock is negotiating on behalf of the Lookout Mountain, Ga. City Council; and Mayor Teddy Harris is negotiating for Rossville.

Chickamauga isn't taking part in the local option sales tax talks. Etheridge said officials there are fine with the county keeping 80 percent.

Oliver thinks negotiations will be resolved after Tuesday's election, in which Sole Commissioner Bebe Heiskell is seeking re-election.

"I'll be surprised if we don't see some movement after the election," he said. "It's tough during an election period to get people to express what they really want and what they're really willing to accept."