Occupational tax ruling in JeffCo's favor - ABC 33/40 - Birmingham News, Weather, Sports

Occupational tax ruling in JeffCo's favor

Occupational tax ruling in JeffCo's favor

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Jefferson County may not have to pay back money collected from its occupational tax as part of the 2009 Weissman Vs. Jefferson County case.  Jefferson County Manager Tony Petelos says Friday's Alabama Supreme Court ruling will allow $100 million dollars to be kept for general fund expenses. Right now, the county is operating with a $200 million dollar deficit.

In 2009, Circuit Judge Charles Price issued orders to prevent the county from imposing its occupation tax. The decision eventually led to the layoff of county workers and the commission filing for Chapter 9 bankruptcy protection.

 

UPDATE: 

 

The Alabama Supreme Court says that Jefferson County "does not" have to refund $100 million in occupational tax money. That's a big relief to county leaders, employees, and the thousands of people who depend on county services.

"The Supreme Court recognized reality and said in essence, you can't get blood out of a turnip," Jim McFerrin, an attorney during the first occupational tax case told us. "Jefferson County is broke and it's impossible to get refunds."

After bankruptcy, budget cuts, and trying to make ends meet, Jefferson County got some good news.

"This liability was out there and now it's gone away," Tony Petelos, Jefferson County's Manager said. "Now we can  move forward through bankruptcy and providing services to people of Jefferson County."

The State Supreme Court upheld a lower court's ruling that said $100 million in occupational tax money did not have to be refunded.

It all started with an individual who argued that Jefferson County needed to  refund the cash - 
a lawsuit that's been hanging over the heads of county leaders.

"The prospect of having a $100 million liability we would have to pay while we're in bankruptcy would be devastating to us in providing services to the people of Jefferson County," Petelos said.

An attorney on the first occupational tax case told us, Jefferson County would have simply shut down.

"That would have meant that the courthouse would have been shut, that would have meant that the Sheriff's department would have locked the doors, there would have been no county courthouse and no county services," McFerrin said.

County leaders say - because they do not have to refund the money - totaling half their budget,  they will not have to enforce cuts or county layoffs.

"It would have been literally impossible for us to repay that within a year," Petelos said.

Petelos says that if the county had to re-pay the occupational tax it "couldn't have performed." He says it would have rolled into the bankruptcy case with a new payment plan.

 

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