DeKalb County commissioners last week approved a new excise tax on energy used in manufacturing and an agreement that will give 10 cities a large share of the revenue. Meanwhile an 11 percent water rate hike for all users for 2013 did not require any action last week.
A comprehensive tax bill the legislature passed in April will gradually eliminate sales taxes on the “sale, use, storage or consumption of energy” used to manufacture tangible personal property beginning in January 2013. To prevent the cities and counties from losing local sales tax revenue, the bill allowed counties to adopt an excise tax on energy,
To replace the HOST sales tax revenue DeKalb will lose as the state gradually exempts the energy used in manufacturing from sales taxes, the county’s excise tax will grow from .25 percent in 2013 to .5 percent in 2014, then .75 percent in 2015 and finally 1 percent in 2016. The ordinance adopted on January 8 allows the county to also collect revenue for MARTA from the excise tax in the same way. The ordinance limits the total excise tax to 2 percent.
Chief Financial Officer Joel Gottlieb said the revenue from the energy excise tax will be distributed to the 10 cities on the same formula the state uses to determine their share of the HOST sales tax revenue. That formula takes into account the municipal millage rates and homestead values.
Last October, Gottlieb said the cities would get about half of the Homestead Option Sales Taxes (HOST) allocated for capital projects and distributed in 2012 ( $10.1 million for the cities and $10,5 million for the county). About 43 percent would go to two cities, Dunwoody (25 percent) and Decatur (17.7 percent). With the incorporation of Brookhaven, the cities’ share of HOST was expected to rise to almost three-quarters in 2013.
DeKalb will also use the same schedule for distributions of the excise tax revenue as the state uses for HOST, Gottlieb said, so the county will begin sending checks to the cities for their share of the 2013 excise tax revenue in August 2014. The county will also get compensated for administrative costs from the excise tax.
County officials met with representatives from all the cities in DeKalb, including Brookhaven but not Atlanta, and they reached an agreement on the new energy excise tax, Gottlieb said.
“We are collecting signatures to the intergovernmental agreement from the cities,” Gottlieb said last week.
The 11 percent increase in water and sewer rates that took effect January 1, 2013 was approved by the Board of Commissioners in December 2010 as part of a three-year rate increase for 2012, 2013 and 2014. The fee increase was designed to help pay for bonds the county sold for a $1.35 billion Capital Improvement Program for the water and sewer system.
For an average residential customer who uses 5,000 gallons of water per month, the monthly cost of water and sewer service will be about $7 more this year. The monthly bill that was $58.49 in 2011 and $64.95 in 2012, will be $72.07 in 2013.
Before the 11 percent annual increase that began in 2012, the county commissioners had approved in October 2007 a four-year 16 percent rate increase for each year from 2008 through 2011. As a result, the average residential customer’s water and sewer bill for 5,000 gallons of water consumption has almost doubled, from $37.45 in 2008 to $72.07 in 2013.
Also at their January 8 meeting, the commissioners elected Commissioner Lee May to be their new Presiding Officer and Commissioner Sharon Barnes-Sutton to succeed May as deputy presiding officer for 2013. Commissioners Jeff Rader and Kathie Gannon were the only commissioners to vote against May and Sutton.