Business owners, council at odds over tax rebates
Published 8:44 am Monday, August 24, 2015
Two individuals, one opening a new business and another who is a developer looking to recruit businesses, expressed their disappointment in city officials after their requests for sales tax rebates were tabled for the second consecutive meeting.
Andi Turberville, owner of the recently-opened Canebakery, requested a sales tax rebate during a previous council meeting, but was told her business did not qualify under the city’s current rules for a rebate. The second request was from Ben Sherrod who told the council he has two buildings that could house future businesses, including a Little Ceasar’s Pizza.
Members of the council told Turberville that they are continuing to work out details for smaller businesses.
“We have discussed a matrix that would provide a sliding scale based on the number of employees and the total investment, we just haven’t finalized it yet. What we have right now is based on the number of employees and investment and allows for (the rebate to last) seven years. There is no breakdown for businesses that come in above or below those numbers. We want to come up with a fair process and breakdown for small business owners,” said Councilman Bill Meador.
Sherrod challenged the council asking whether they went through the same process when Mayor Mike Grayson requested, and received, the sales tax rebate for his new restaurant during a meeting in July. The mayor has said his business would have 14 employees and that the total investment would be about $200,000.
The council also told Sherrod that the sales tax rebate was once given to a developer in 2008, but that more recently was only given to the businesses that will be providing jobs.
“The council said it was a mistake when they did it then and that (the rebate) should have gone to the businesses,” said Councilman Charles Jones.
Sherrod said that by providing the incentive to the developer, the council would be helping to keep more money in the city.
“I have two businesses interested, one in Mississippi and the other in Sumter County. How much of that money will they bring back to Demopolis?,” Sherrod said. “I guess this was a mistake … we thought we would be treated the same as the mayor.”
Jones said he feels the tax break should go to those providing jobs to local residents.
“Since I’ve been here we have given (the rebate) to business owners,” he said. “They are the ones employing individuals in our city, even if they are absentee owners. They get the break because they are binging jobs to Demopolis.”
The council told Turberville that under current guidelines, they would have to vote against her receiving the sales tax rebate due to only having one full-time employee.
Speaking to the mayor’s rebate, Jones said he would be held accountable for the information he provided to the council.
“He has to provide the number of employees he said he would have. If he don’t meet those standards he won’t get the break,” Jones said.
Sherrod said he felt the council is attempting to change the rules.
“It appears you are trying to back up and make new rules that make you comfortable,” Sherrod said.
Sherrod also accused the council of discussing the matter outside of a public meeting after a councilmember said it had been discussed prior to the meeting.
“Who all is in these meetings?,” Sherrod asked.
Jones said the matter was discussed by members of the council’s finance committee.