Alpla looks for tax exemption from city
Wednesday, July 24, 2013
A local company is seeking a city exemption to allow for a cap on the amount it would have to pay to the city in gross utility taxes.
At the Finance Committee meeting Tuesday, Alpla’s plant manager Bob Volmert, accompanied by Shaun Sappenfield, existing business manager with the Jefferson City Area Chamber of Commerce, asked committee members to consider granting an exemption to the company under an ordinance that is no longer in effect.
City attorney Drew Hilpert said beginning in the 1980s, Jefferson City offered exemptions to manufacturers on gross utility tax revenues paid to the city. The ordinance states manufacturers would not pay more than $15,000 per year per utility service.
But the City Council cut that exemption off last year. The only manufacturing businesses allowed that exemption are those who were granted it before Nov. 15, 2012.
Hilpert said Alpla representatives had been discussing the exemption with the city before the November date, but those talks stalled when the city discovered a $1.68 million shortfall earlier this year. He said if the exemption were granted to the plastic bottle manufacturer, the city would lose $40,000 annually.
“Staff still feels like we can’t afford it,” Hilpert said of the exemption.
Volmert said the company feels the city should be able to grant the exemption, regardless of the tight budget.
“This has been pursued for over a year now,” Volmert said. “We do feel like this is independent from any current situation with the city budget.
“We just want to work the city and move forward and get what we want.”
Volmert said the exemption is offered by a number of Missouri cities and the company has agreed that if the city grants it, they will not seek retroactive payments, only an exemption going forward.
Committee members all said they wanted more time to think about the request and go through the original ordinance before making any decision. The issue likely will be discussed again at next month’s committee meeting.
In other business, the city reported lodging tax collections have accumulated more than $1.2 million for the conference center fund and collections for the conference center are averaging about $48,000 per month.
Shiela Pearre, chief accountant for the city, said the monthly collections are enough to fund payments on a $9 million bond to pay for construction of a conference center. The $1.2 million already collected would be added available funds, she said, that could be used in the future.
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