Mayor Littlefield continues talk on sales tax agreement

Mayor Littlefield continues talk on sales tax agreement

March 7th, 2011 by Cliff Hightower in News

Mayor Ron Littlefield . Staff Photo by Laura-Chase McGehee

Mayor Ron Littlefield continued talks on the sales tax agreement Monday, reiterating that he believes it will end in May.

"Why not extend the agreement?" Littlefield asked. "Well, the agreement is out of date."

Littlefield spoke to a crowded Pachyderm Club Monday about the sales tax agreement and hinted a bit at consolidation of city and county services.

The sales tax agreement is set to run out on May 23, and Littlefield said he has no intention of renewing it. The agreement divvies up the amount that Chattanooga and Hamilton County each pay to jointly funded agencies. Those agencies include the Chattanooga-Hamilton County Bicentennial Library, the Chattanooga-Hamilton County Health Department, the Children's Home and the Speech and Hearing Center.

A portion of money from the sales tax agreement has been traditionally placed in county coffers since 1966 when the contract was put in place. Letting the agreement expire would bring $10.5 million in sales tax to city coffers.

Littlefield told the club that the agreement was unfair because it uses city sales tax dollars to pay for some quasi-governmental and nonprofit agencies the city also is funding through its general budget.

For example, he said, the Chattanooga-Hamilton County Bicentennial Library and the Chattanooga-Hamilton County Regional Planning Agency are being funded 100 percent by the city because the city is using property tax money to fund those agencies and the county is using city sales tax dollars.

But even if the agreement runs out, none of the agencies should worry about where their money will come from.

"Some agencies will be totally funded by the city, some agencies are already funded by the city," he said.

County Mayor Jim Coppinger, who was in attendance at Pachyderm, said afterward he did not want to get into specifics about the mayor's comments on funding.

"I continue to be disappointed we can't come up with some type of agreement," he said.

But, he said, at the end of the day the county and city will come up with a conclusion.

"We're going to work together," he said.

Contact Cliff Hightower at chightower@timesfree press.com or 423-757-6480. Follow him on Twitter at twitter.com/CliffHightower.