COLUMBIA — A Centralia road district official warned of a lawsuit while Columbia's leaders were more content with a proposal for a new county road tax formula presented over a mayors' dinner Wednesday.
The new formula would leave some municipalities with five-digit revenue drops, while Columbia and Boone County would end up with increased revenue.
A subcommittee was appointed last year to study what Boone County Commission members saw as a growing problem — the county's formula for distributing revenue from its road tax has gradually skewed toward municipalities.
While the county retained 49 percent of road sales tax revenues in 1995 — providing the rest to municipalities — it only retained 36 percent this year. Its present formula stems from a decision in 1993 to replace the 29-cent property tax with a half-cent sales tax. As cities lost revenue from the previous property tax, the county has been offering them 1.5 times what they would have collected if the property tax was still in place.
But this system has been putting a higher percentage of the road tax money in city coffers each year, leaving less for the county.
The leaders of 11 Boone County cities and the Centralia Special Road District were invited to dinner at Rock Bridge Elementary School to hear the subcommittee's proposed solution.
Not everyone liked what they heard.
Gary Riedel, presiding commissioner of the Centralia Special Road District and the dissident member of the six-person subcommittee, said his road district has retained Seigfreid Law Firm LLC from Mexico, Mo. He said it might file a lawsuit.
“I hope it wouldn’t come to that, but I feel like we are being treated unjustly, and we’re going to try to make sure that justice is done,” Riedel said.
Riedel said his district stands to lose as much as $80,000 by the time the phase-in to the new tax formula is complete in five years. By his calculations, his district would receive $700 per mile for its roads from the proposed revenue-sharing program, while the county would receive $5,700 per mile for its roads.
He requested during the meeting that this difference be evened out.
“Then we can live,” Riedel said. “Then you will treat us like a road district, like someone who has roads to maintain.”
Many in the room were not swayed by Riedel’s pleas.
“I think we did everything possible to hold you as harmless as possible, and it was never enough,” said Chris Heard, Ashland city administrator and a member of the revenue subcommittee.
Commissioner Karen Miller pointed out that the county’s roads get more traffic than those in Centralia's special road district, so the county needs more money to maintain its roads.
Ken Pearson, Boone County presiding commissioner, also said the special road district receives money based on its property taxes, which include the city of Centralia in its calculation. However, the special district’s money goes to the areas surrounding Centralia — none of the funds go to the city itself.
Riedel was not the only one unhappy with the proposal.
Hallsville Alderman Jim Bunton was concerned about the drop in revenue for his city from about $51,000 to about $19,000 over five years under the new tax proposal.
“We have a $800,000 budget, so the impact of $32,000 is significant,” he said.
Columbia Mayor Bob McDavid sat quietly throughout the meeting, smiling now and then as others thanked Columbia for giving up part of its revenue to help smaller municipalities phase into the new formula.
In the five-year phase-in, Columbia will offer up to $200,000 a year to help tide over smaller cities while still coming out slightly ahead. The city will get $2.07 million from the road tax five years from now, as opposed to $1.9 million in the first year of the tax phase-in.
McDavid said nothing during the meeting but afterward said he thought the new formula was fair.