Taxes to increase to 11 percent?

A two percent tax increase is set to take effect on April 1 in the Wal-Mart shopping area, putting the number at 11 percent.

Residents in Donaldsonville may in be a bit of a surprise on April 1 when they walk in to Wal-Mart or stores nearby and get a noticeably higher bill than usual. Effective April 1, an 11 percent tax will be issued to stores in the Wal-Mart and Wal-Green’s area due to a two percent increase from an expired agreement between the city and Parish of Ascension.

Back in 2004, Donaldsonville annexed that parcel of land from the parish and when it did that it added an additional two percent in sales tax. However the two percent was never accounted for due to a revenue sharing agreement between the two sides, and also the Ascension Parish Sheriff’s Office.

The parish government and the sheriff’s office sales tax applied to everything on the west side outside of the city limits.

The initial contract was set to expire on December 31 of 2013, but the parish council and sheriff’s office both agreed to extend it an additional three months.

“It is an issue that happens across the country where municipalities coming in a annexing areas into their city limits,” Parish attorney O’Neil Parenton said.

Parenton said the parish government and sheriff’s office feel they need to create these taxing districts which is what’s taking place. They created a district that has a sales tax in it. If they don’t create the districts “you are liable to have municipalities just coming out of the ground just to take advantage of the existing tax base.”

“Donaldsonville needs to ensure the revenues they had coming in the past will come in the future because they dedicate their taxes to paying off debt such as bonds,” Parenton said. “Without protecting that sales tax base their credit rating could decline in the future.”

Donaldsonville City council chairman Raymond Aucoin said historically the city collected about $1.75 million in sales tax. And anything over that amount, the city received 90 percent of it and the parish received 10 percent.

Aucoin said the parish said it’ll make sure Donaldsonville receives what it did in the past and “anything over that we’ll split 50/50.”

The curve ball comes in to effect when the parish passed an ordinance saying any new annexed area by a city in the future would be a 75/25 split, the parish getting the larger amount.

Aucoin said when that came up, the council talked to Parish President Tommy Martinez and he said he “could try to get us 50 percent.”

Donaldsonville Mayor Leroy Sullivan said if the parish was willing to set down and agree to the same agreement “we’ve had for the past 10 years the city would be in agreement with that.”

Even with the 50/50 split above the threshold, Donaldsonville would lose about $200,000 a year and Mayor Sullivan said the city can’t afford that.

“It is more about survival for the city,” Mayor Sullivan said. “The city collects about $1.8-1.9 million (this does not include the half cent for roads) in taxes a year; so you can see that we aren’t talking about a lot of money for the city.  But a $200,000-300,000 a year lose in taxes would greatly affect the city’s ability to operate.”

Mayor Sullivan said he hopes the lost revenues will not affect the city’s future growth but with the economic development that has been taking place in the past year the city could really capitalize on the extra money.

“The parish wants a larger piece of the pie with no responsibility,” Mayor Sullivan said. “They have no responsibility to improve the infrastructure in that area or anything else.”

Mayor Sullivan said the Sheriff is willing to keep the agreement the way it is and he has the responsibility to patrol and enforce the law in that area, and he just hopes the parish would see the same.

Ascension Parish Councilman Oliver Joseph, District 1, who represents the people of Donaldsonville said there is a solution but both sides have to come and sit down at the table. As far as the two percent increase, the city is making the decision to put the additional two percent sales tax, “not us,” Joseph said.

Joseph said the parish wanted to give Donaldsonville a 50/50 split on the revenues, but the City of Donaldsonville “never attempted to communicate with the parish on an agreement.”

Joseph said the city has at least known about the situation since December, and still never asked to call a meeting with the parish attorney, the council, or the parish president.

“I feel it is not fair the people is going to be taxed that and our government officials did not try to negotiate a better deal or communicate,” Joseph said. “Bluntly, no one communicated.”

“They have never spoke to us,” Joseph said. “I’m willing to fight for something fair, the statement is saying 75/25 but they have an opportunity to get 50/50.”

Dated for July 7, 2013, Joseph said he gave a proposal for Donaldsonville tax sharing to the Mayor Sullivan and councilmembers Charles Brown, Sr., Lauthaught Delaney, Sr. and Reginald Francis.

“I was assuming they’d come back and want to negotiate,” Joseph said. “That never happened and here we are.”

Joseph’s proposal included three options: the first would be to split 50/50 the taxes collected in the annexed area between the parish and the city; the second would be to follow the current parish ordinance which is a 75/25 split on annexed property taxes collected between the parish and the city, the city getting the larger amount; the third option would be to give the first $1,750,000 in taxes from the West side to the city and everything collected thereafter is split 75/25 between the city and parish, the larger amount to the parish.

“Anything after 2009 if you annexed it is 75/25 with the parish getting the majority, but because this agreement was done 10 years ago we figured it would be great just to go with 50/50,” Joseph said.

Mayor Sullivan said each of on Joseph’s option would cost the city money, and the Donaldsonville can’t afford that.

“Neither party is talking and nobody is going to get answers,” Joseph said. “They never once tried to counter offer or communicate.”

Joseph said the parish reached out and had a meeting and the city heard it and never came back and counteracted with anything.

“Now you want to tax the Wal-Mart area 11 percent, I only feel that will hurt the economic development here,” Joseph said. “One of the poorest districts, communities, in Ascension Parish. I just don’t see how that would be viable to the community when they could’ve had other avenues.”

Mayor Sullivan said he met with the parish three times to try and work an agreement out, and he said Aucoin and Donaldsonville City Attorney Chuck Long also went as well.

Mayor Sullivan is scheduled to meet with Ascension Parish Council Chairman Chris Loar and other parish officials on Friday.

“They can’t say we didn’t meet. I had three meetings with the parish president,” Sullivan said.