LOST funds may further divide Lee communities

The best things in life are free, but you can keep ’em for the birds and bees. I want money.

— Barrett Strong

In the overall scheme of things, the local-option sales tax money being argued over by Lee County, Leesburg and Smithville officials seems such a small thing. But the estimated yearly $2,529,080 that will be generated by the 1 percent sales tax in the county has become something of a lightning rod that threatens to widen an already existing political and socio-economic gulf that separates the entities.

As officials with the Lee governments engage in a war of words over right and wrong, fairness and equity, during LOST distribution discussions, the essence of their meetings is not lost on interested observers.

As usual, it’s all about the money.

For years, the county has divided LOST funds using an outdated formula based roughly on the population of the three entities more than 30 years ago. And, thus, the unincorporated portion of the county has gotten 70.94 percent of the funds, Leesburg 17.5 percent and Smithville 11.56 percent.

A dramatic population shift spurred by a huge influx of new citizens in the 1990s, however, has altered the population distribution dramatically so that now roughly 87 of the county’s people live in unincorporated areas, slightly more than 10 percent in Leesburg and less than 3 percent in Smithville.

The economic recession that crippled many city and county governments across the country and has local officials laying off, furloughing and cutting employees hasn’t impacted Lee as dramatically as other counties in the region. But it has taken a toll. So much so, in fact, that finance officials in Southwest Georgia’s most economically sound county have started looking for ways to bring in more income.

They’ve set their sights on the LOST funds. And even with a $22 million (county) budget, the $300,000 to $500,000 in additional local-option sales tax money could certainly come in handy. It might even stave off the need to dip into rainy-day funds or prevent a dreaded millage rate increase.

But any increase in LOST funds incorporated into the county’s budget would come at the expense of Leesburg and Smithville. Leesburg officials have trumpeted the daytime population in the city, where all of the county’s schools are located, and they fear LOST cuts would force them to cut back on such services as police protection and public works.

Smithville, meanwhile, has come to rely dramatically on its share of LOST funds. As City Council member Vincent Cutts noted, “That’s how we pay our bills.”

Mayor Jerry Myrick has said that a severe cut of the kind being discussed by county officials would be a “death sentence” for the tiny community in the northern end of the county, which has been dealing with the fallout of the completion of U.S. Highway 19 that diverts traffic away from its diminishing downtown.

Lee County Commissioner Rick Muggridge presented a worksheet at “compromise meetings” last week that shows the current distribution of LOST funds gives Smithville residents an $815.29 per-capita share of the funding, Leesburg residents a $300.97 share and county residents an $89.37 share. He’s held firm to the contention that the purpose of the LOST tax — to provide equitable property tax relief — is not being met in the county.

Leesburg officials, meanwhile, are saying they won’t take less than 13 percent of the funding, while Smithville officials say they want at least 7. The county has proposed splits of 12 and 6. Complicating the discussions, especially for Smithville, is an element of state law that allows the county to reach an agreement with Leesburg, which is home to 80 percent of the county’s municipal population, and essentially leave the smaller community with no say in the matter.

Sadly, the current situation could have been avoided had county leaders adjusted the 10-year LOST distribution disbursements gradually over the past three decades to account for the population shift rather than leaving it as it has been since the tax was approved by the state in 1975. Now Smithville has come to rely on the LOST funds so much that a severe cut could indeed be a crippling blow.

County officials have apparently settled on an 82-18 split of LOST funds, with Leesburg and Smithville left to negotiate for their share of the 18 percent. If no agreement is reached in the next 30 days, a judge will decide the matter.

And despite Muggridge’s contention Monday that progress is being made, it seems very unlikely an agreement will be reached that will satisfy all three groups of officials. And the resentment that has smouldered under the surface for a while now is starting to burn a little bit brighter each passing week.

Email Metro Editor Carlton Fletcher at [email protected].