LEESBURG -- Stakes will be high when representatives of Lee County and the municipalities of Leesburg and Smithville meet at the Lee Chamber of Commerce building this morning to discuss distribution of local-option sales tax collected in the county.
Every percentage point subtracted from or added to one of the entities' LOST totals is worth $35,000, an amount significant enough to alter local government budgets considerably. But officials say that for the smaller municipalities, the final results could be game-changers.
"It seems clear the county does not intend to give Smithville 11 percent of the LOST funds (as it is currently receiving)," that city's attorney, Tommy Coleman, said Friday. "That being the case, Smithville will have wants and needs that it will not be able to afford.
"In essence, (a significant cut in LOST funds) will be a tax increase for the people of Smithville. And they're the people who can least afford one."
Government subdivisions in Georgia counties that have approved 1 percent local-option sales tax collections are required by the state to use certain criteria to determine every 10 years after census data are collected how much of the money will go to each subdivision. LOST collections were approved by the state Legislature in 1975 as a measure of property tax relief.
Lee County leaders decided after the 1980 census that the local split would be 70.94 percent for the county, 17.5 percent for Leesburg and 11.56 percent for Smithville. There are no records that give a clear accounting for that split, but most agree that the numbers closely mirror population percentages at the time.
And while the state says population cannot be the only determining factor in LOST allocations, Lee's current population split is 87.7 percent in the county (24,827), 10.2 percent in Leesburg (2,896) and 2 percent in Smithville (575). The unincorportaed portion of the county also contains 93.4 percent of the property tax digest and collects 96.76 percent of property taxes.
Those numbers were used by County Commissioner Rick Muggridge at a joint meeting of the three county governments last week to suggest a "starting point" LOST split of 94 percent for the county, 5 percent for Leesburg and 1 percent for Smithville, numbers that did not sit well with representatives of Leesburg and Smithville.
Leesburg Mayor Jim Quinn called the numbers "shocking."
The government leaders and their various attorneys agreed to form a committee of two members each to meet as a "compromise committee" to discuss the LOST split. County commissioners Muggridge and Bill Williams were selected to represent the county and Quinn and Leesburg City Councilman Bob Wilson were chosen to represent Leesburg. Coleman and Mayor Jerry Myrick were selected to represent Smithville.
State Rep. Ed Rynders, R-Leesburg, recommended County Commissioner Dennis Roland serve as an ex officio member of the committee because of his ties to all three entities.
County Commission Chairman Ed Duffy suggested the committee hold as many meetings as needed to "decide how to divide the LOST pie," marching orders that were on Leesburg City Attorney Bert Gregory's mind Friday.
"Economic times have changed; that's why we're pursuing this matter," Gregory said. "When you've got a shrinking pie, you find that manners change for everyone sitting at the table.
"I think it's apparent to anyone who knows anything about the governments in Lee County that any reduction in LOST percentages is going to have a greater impact on Leesburg and Smithville. Look at the budgets of all three. Lee County's budget is 10 times greater than Leesburg's. ... You do the math."
Duffy, though, said he expects the representatives to come up with a compromise all three entities can live with.
"This board appointed commissioners Rick Muggridge and Bill Williams to negotiate a fair and equitable distribution of the LOST sales tax," he said Friday. "The county wants to negotiate in the spirit of cooperation because the last time LOST was negotiated with the cities was in 1980, obviously a lot has changed since then."