Taxation without representation


The Highland Lake town council met March 10, in part, to address pending ordinances that would impose a sales tax, a motor fuel tax, and a lodging tax on residents, including those who live within the 1.5-mile police jurisdiction. After a lengthy, sometimes disorderly meeting punctuated by mostly negative audience comments, the council tabled the matter. The ordinances would impose:

• A sales tax of 3 percent for sales within the town’s limits and 1.5 percent for those within the police jurisdiction.

• A motor fuel tax of one cent per gallon for sales within the town’s border and one-half cent within the police jurisdiction.

• A lodging tax of 4 percent for any “rooms, lodgings, or accommodations” provided to transients in town limits and 2 percent for those in the police jurisdiction. (Think VRBO or Airbnb.)

Highland Lake currently has no sales, fuel, or lodging taxes. The town is unique in that it has no retail businesses within the town’s borders, and only one in the police jurisdiction.

Officials have said the money is needed for road maintenance necessitated by the county’s decision last year to cease maintaining the town’s roads. Thirty-five percent of the new revenue will go to the police department. Police Chief Scott Kon pointed out the department’s budget in 2009 was $40,000 and it’s FY2020 budget was only $42,000. In 2009 the budget provided for about 2,700 hours of service, while the current one allows only 2,100. He said the department had not purchased a new vehicle since 2009 and those in use have been essentially donated from other departments.

A large crowd turned out for the meeting, too many to fit inside The Anchor where council meetings are held. Its capacity is 120 and once reached, officials left a conservative estimate of about 75 others outside. After dispensing with its routine business, the council addressed the taxes. Gail Bailey, chair of the town’s permanent roads committee, explained what the taxes would do and their effect. The fuel and lodging taxes are straightforward in that if a purchase is made at the Highland Super Stop, the only retail business affected, the sales and/or fuel tax will be added on. The same would be true if a home is rented to a vacationer. For items purchased elsewhere, but delivered, the ordinances would require the seller to charge the appropriate tax. This applies to propane, building supplies, appliances, and anything else delivered. (Online companies like Amazon are excluded because the tax is paid to the state and disbursed.)

Bailey tried to dispel incorrect rumors, explaining the taxes would have no impact on farmers, Appalachian School will not pay sales tax, and there would be no effect on property taxes. She noted the police jurisdiction of 1.5 miles is set by state statute, and reports of a five-mile jurisdiction are erroneous, as is the suggestion that the council wants to annex property, a move that would require legislative action.

Bailey also appealed to the audience’s sense of fairness, pointing out the mayor and council receive no salary, the town donates to the local volunteer fire department, provides meals for the Appalachian football team, provides a $1,000 scholarship to a student each year, and events at the town are open to all, not just residents. “We care about and help our neighbors.”

“No taxation without representation” was a refrain repeated often during the meeting by those opposed to the taxes referring to the residents who live within the police jurisdiction. They would be required to pay the levies, but cannot vote in council elections. Town attorney Alex Smith explained the issue of taxing those in the police jurisdiction had already made its way to the Alabama Supreme Court where the right to levy the taxes was upheld.

Others questioned the council on what benefit those in the police jurisdiction would receive from the taxes, and other than continued police patrols, the answer was none. One man was applauded when he summed up the mood of many by asking, “When is enough taxes enough for the government to operate on?”

That question may have been rhetorical; however, another was not. A question about the percentage of residents who pay the lake use fee went unanswered. Mayor Donna Hanby responded by asking why that question was “pertinent.” After the meeting, another resident explained the question was on point because the fee is not required by those who live in town who do not put boats in the lake. She said it should be required of all residents before the council tries to impose taxes on those living in the police jurisdiction.

The issue was later put to the town’s attorney who said that given Highland Lake is a municipality and not a homeowners association, imposing the fee on everyone might not pass legal muster, at least not without a referendum.

The regular monthly meeting is the first Tuesday of each month at The Anchor at 7 p.m. However, the council can call a special meeting to bring up the taxes again. Meeting notices are usually posted on the town’s website www.townofhighlandlake.com.