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Local option sales tax revenues up in '11

POSTED: March 12, 2012 2:03 p.m.

For a second year in a row, Hinesville’s local option sales tax revenues have increased following a major decrease in revenues two years ago, according to data provided by Hinesville Chief Financial Officer Kimberly Ryon.

The data shows a 7.498 percent decrease in local option sales taxes collected in 2009, which dropped from $4,106,023.02 collected in 2008 to $3,798,248.79. However, local option sales taxes collected in 2010 increased by 12.251 percent to $4,263,566.54, then by a modest 0.831 percent in 2011 to $4,298,990.42.

"The decline in 2009 can largely be attributed to military deployment," said Ryon, indicating that Fort Stewart intricately is connected with Hinesville’s economy. "Most of the (3rd Infantry Division) brigades were deployed in 2009. Similarly, when the soldiers came back, (I think) we tended to see a large increase in local options sales tax revenues."

According to the New Georgia Encyclopedia, tax revenues are the largest source of general revenue for local governments in Georgia.

Ad valorem ("according to value"), better known as property taxes, local option sales taxes and use taxes are the chief means by which city and county governments raise revenues. All local option sales taxes must be approved by voters within the jurisdiction of that municipality.

Sales taxes for most things purchased in Georgia are 7 percent, which includes a 4 percent sales tax by the state and local option sales taxes, according to the Georgia Department of Revenue. Grocery items, medical devices and prescription drugs are exempted from sales taxes.

Ryon said that large-item purchases, like automobiles, that are bought in another city are credited by the state to the county in which the buyer lives.

"So, if I buy a car in Savannah, Liberty County will still get my sales-tax revenue," she said.

Most counties have additional local option sales taxes, usually 1 percent for the county, 1 percent for the school system (called an ESPLOST for educational special purpose local option sales tax) and 1 percent for a special purpose local option sales tax (called a SPLOST) for capital projects voted on by referendum.

Ryon said Liberty County’s local option sales tax is divided among the qualifying municipalities, based on the population of each city. Hinesville currently gets 44.33 percent of the total local option sales tax revenues for Liberty County.

"In 2011, I think we saw a leveling out of spending," Ryon said. "We did see an increase but a very slight increase. I believe that the small increase is representative of the tough economic situation we are seeing nationally. We didn’t have external factors that would cause any big swings either way."

 

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