December vote could transfer millions in sales tax revenue to St. George

ST. GEORGE — Residents of the newly formed city of St. George will vote in December on transferring tens of millions of dollars in sales tax revenue from the city-parish to the new city.

St. George council members voted unanimously at a special meeting Monday night to allow residents to authorize the city to collect its portion of the taxes currently collected by the city-parish.

East Baton Rouge Parish currently collects 10.45% in taxes from residents. Of that, the state receives 4.45%, with the remaining 6% going to the city-parish. St. George businesses and residents contribute roughly 2% of the taxes collected by the city-parish, equating to more than $50 million annually.

“This is not a new tax. This is simply moving the tax revenue,” said St. George Transition District Chairman Andrew Murrell. “It would give the voters permanent control if you vote for it on December 7th.”

In 2017, the 2% of taxes within the city of St. George collected roughly $48.3 million. Officials estimate that St. George’s 2% share could now be between $55-58 million. This money would become the general fund for the City of St. George, which will be the fifth-largest city in the state. Murrell says the estimated revenue from the 2% is above what they expect it will cost to run the city per year.

“We estimate $40 million a year. The money would be spent on DPW, drainage, cutting the grass, road maintenance, administrative cost like accounting or salaries for the St. George Administration. There’s also planning & zoning but that is usually offset by permit costs and eventually, permits will go through St. George directly,” said Murrell.

St. George residents to vote Dec. 7th

On December 7, 2024, residents of the newly formed city will vote on transferring their tax dollars to St. George instead of the Transition District. It’s similar to moving money from one bank to another. Previously, the city-parish managed the 2% revenue, but now it will be handled by the Transition District. If approved by voters on December 7, the City of St. George will manage the funds.

“It means the St. George citizens have input into how the money is spent. As of the April 26th Supreme Court ruling, the citizens would now have a say in how their tax dollars are being spent,” said Murrell. “The 2% sales tax, plus occupational and use taxes collected in St. George, plus permitting fees, will be the sole source of revenue controlled by the City of St. George.”

If voters choose not to approve the item on the December 7th ballot, the money will remain under the Transition District. However, the Transition District will eventually be dissolved once a permanent mayor, council, and police chief are elected. Officials hope these positions will also be on the December 7, 2024 ballot.

“If the vote doesn’t go through, the money would remain with the Transition District. I can’t foresee the citizens of St. George having a tax where they did not vote on it. We believe it’s important for the citizens of St. George to have a say in their tax dollars and that means voting in favor of transferring the tax authority,” said Murrell.

Retroactive tax revenues?

As of now, the focus is on prospective tax collection and not retroactive collection. However, St. George officials are working to ensure the city receives its rightful 2% tax revenue dating back to the incorporation date of November 23, 2019.

“EBR Parish should be able to show us the expenses incurred for St. George since the incorporation. Any net revenue, sales tax minus expenses collected from November 23, 2019 to present should be owed to St. George,” he added.

With an estimated $50 million annually, that’s nearly $250 million due to St. George. However, the newly formed city must also pay for all the services the city-parish has provided over the last five years. At this time, there is no estimate on the total cost of these services.

The next regularly scheduled St. George meeting is July 23, 2024.

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