Bradley County/Cleveland Sales Tax Lawsuit To End Pending City Council Agreement

Tuesday, November 6, 2012 - by Tonya Brantley
A resolution regarding the sales tax lawsuit with the City of Cleveland was added to the Bradley County Commission voting agenda by Commissioner Adam Lowe Monday evening. On Oct. 30, the Court of Appeals issued their decision on the sales tax dispute. The court affirmed the previous decisions that “upheld the validity of the contract and further held that the contract as amended twice, i.e., in 1972 and in 1980, controls distribution between the parties of the proceeds of the County’s 1982 increase.
The Court of Appeals did reverse part of the Chancellor’s judgment that held that the City’s statutory right to the proceeds from the 2009 tax increase ended June 20, 2009. The Court of Appeals ruled that the “city shall be entitled to receive the proceeds of the 2009 tax increase on sales within the city limits from July 1, 2009 and through June 30, 2010.”
Commissioner Adam Lowe said, “I would like to personally thank Councilman George Poe, Councilman Dale Hughes and Councilman Richard Banks for their continued support of having a cooperative relationship with this commission. We’ve sent over several resolutions that were unanimous from this body and it was warmly received by those three councilmen. Unfortunately, three councilmen were not enough to make consensus. I want to thank them for their continued support and I know that they are looking forward to a resolution to this issue as much as we are.”
He went on to say, “This commission, I am proud to say, has never engaged this issue politically. I think it is reasonable for us to say that $3 million worth of revenue out of our general fund budget, which will be the impact of what the city has asked for, is an unreasonable request in light of 40 plus years of cooperation in which this commission has voted for project after project, initiative after initiative that has placed commercial and industrial revenue within the bounds of the city. We’ve cooperated on city growth and the expansion of their borders which has allowed them to garner more revenue for the city. We’ve worked within every regard for 40 years. We have a 40 year track record of solid investment and financial cooperation with the City of Cleveland. When we said that we were business partners for 40 years for the good of the citizens of Bradley County, 60 percent of which are citizens of Cleveland as well, I’m proud of that history. I’m proud of looking back and seeing that investment that we continue to make in the City and cooperation that we continue to yield.
“At no time has the county ever actively pursued developing its own commercial situs base within the county limits so we can get all or more of any revenue. We were in an agreement that allows us to have that cooperation. So, I think that we can continue to appeal to reason. Step one is we received another ruling from appellate court which upheld that our history of cooperation is a good thing. I think that there is wisdom in that decision. The Tennessee Supreme Court has said that there are measures and steps we can take to resolve this and I hope we can do that tonight. Before I put this in the form of a motion, I want to say if the City of Cleveland accepts this motion and we approve it tonight, this stops and we move on. It stops. The overwhelming resonation in this community is that this needs to stop. This resolution can do that.”
The resolution states:
Whereas, the Tennessee Court of Appeals has decided that an ambiguity exists in the statute governing the distribution of the 2009 local option sales tax for Fiscal Year 2010; and,
Whereas, Bradley County has maintained its position to accept the Court rulings regarding the issues raised by the passage of the 2009 county wide sales tax increase; and,
Whereas, the Bradley County Commission continues to believe that this matter should be resolved; and,
Whereas, Bradley County has been advised that an application for rehearing and/or application for permission to appeal to the Supreme Court is available; and,
Now Therefore, Be It Resolved by the Bradley County Commission:
1. The Commission waives its right to apply for rehearing to the Tennessee Court of Appeals.
2. The Commission tenders to the City of Cleveland an offer to accept the ruling of the Tennessee Court of Appeals.
3. The Commission requests that the Cleveland City Council engages in settlement discussions regarding a reasonable way to pay over unto the City of Cleveland the ultimate amount which is determined to be due the City of Cleveland, under the ruling of the Court of Appeals.
4. In the event the City of Cleveland does not accept this offer in a timely manner, the Commission authorizes and directs Counsel to take such steps as are necessary to protect the interest of Bradley County and all its residents in the litigation presently pending.
The resolution passed unanimously.
Along with the consent agenda, a motion for a bid opening for the next phase of the park on Minnis Road, a resolution supporting the naming of the Veterans home as The Cleveland/Bradley County State Veterans Home, a rezoning request from the Bradley Veterinary Hospital to rezone 5527 Georgetown Road from Rural Residential (R-1) to Rural Commercial (C-1) to replace the existing facility it has now and a motion to approve the medical insurance copay plan option also passed.
The Bradley County Commission will hold its next work session meeting on Tuesday, Nov. 13, at noon.

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