Laughter warns of 'cataclysmic event' if agreement with Dalton not reached by deadline

Amid a failed day of mediation, trading negotiating offers in letters and with a Thursday deadline from the state to reach an agreement on a new service delivery agreement, Whitfield County Board of Commissioners Chairman Lynn Laughter said the City of Dalton is on the verge of pushing the county and the four municipalities within it “off a cliff.”

“I would say to the city to at least please sign an extension until February so we don’t go off a cliff on Oct. 31, and they said that wasn’t in the best interest of their citizens,” Laughter said. “I don’t understand that because Friday morning we will be a non-qualified government and that means losing massive money, state grants, state permits ... It is a cataclysmic event for the county and all four cities.”

Under state law, cities and counties must negotiate a new service delivery agreement every 10 years, spelling out which services the governments will provide and how they will be paid for. The idea is to avoid duplication of services. Without an agreement, the county, the City of Dalton and the other cities in the county will become ineligible for state grants and other funding and permits.

The current service delivery agreement is actually 39 separate agreements, covering areas ranging from ambulance service to zoning. Representatives of the governments met for almost eight hours two weeks ago in mediation but failed to reach an overall agreement.

The city sent a letter to the county last week with an offer hoping to settle the dispute. Included were that the county would transfer 10 percentage points of its Local Option Sales Tax (LOST) revenue to the city, giving the city 45% of LOST funds and costing the county about $1.6 million a year, with this deal locked in for 12 years; the city would take over the Dalton Convention Center in 2020, and the county would pay the city a one-time payment of $2 million for its share of deferred maintenance; the Dalton Area Convention & Visitors Bureau (CVB) would be operated under the convention center and the county would dedicate all of its current and future hotel/motel tax revenue each year to fund the agency; and the city would provide its own building, permitting and stormwater inspection service.

In a letter from County Attorney Robert Smalley to City Attorney Gandi Vaughn and McDonough attorney Andrew Welch, who was hired as outside counsel by the city, on Monday, the county rejected some of those proposals and made counteroffers on others:

• "The Board of Commissioners does not see any realistic pathway to compromising service delivery by shifting LOST points to Dalton. Frankly, the county is still absorbing the enormous shift that occurred during the 2012 LOST negotiations and fully expects that, due to population increases and other factors, it will be able to make a very strong case for additional LOST points in 2022" when the LOST agreement is scheduled to be renegotiated. "Dalton's proposal would shift approximately $1.7 million from the county to Dalton because Dalton agreed to abandon its Georgia Municipal Association (GMA) 'tax equity' argument that the county road system is a service that primarily benefits unincorporated areas. From the county's point of view, the notion that the county road system is of no benefit to city residents lacks merit and does not justify concessions from the county."

• "Rather than paying over to the Dalton treasury 5% of all revenues regardless of where generated, Dalton Utilities would pay over 5% of all revenues generated in unincorporated Whitfield County to the county; revenues generated in Cohutta to Cohutta; revenues generated in Tunnel Hill to Tunnel Hill; and revenues generated in Varnell to Varnell."

• "With respect to the trade center facility and all real property and improvements thereon, Whitfield County will either convey its interest over to Dalton at no cost and with no further financial liability or Dalton may convey its interest over to the county at no cost and with no further financial liability. In either instance, the parties will need to cooperate with each other to enact local legislation dissolving the current authority and ensuring that whichever entity owns it has full control over how to use it."

• "With respect to the CVB, leave its operation and funding as is."

• "Whitfield County will manage and operate all youth and adult sports programs countywide and will pay for such operations from its general fund, thus saving Dalton in excess of an estimated $1.5 million annually. Dalton will keep ownership and management of its parks, as will the county. Dalton will keep ownership and will provide capital improvements to its gymnasium and athletic fields necessary for sports programs. The county will have access to such facilities and will maintain them for sports programs. Dalton may continue to operate the senior center as a jointly funded project, with the county's share continuing to come from a special tax district."

• "With respect to building inspection, permitting and stormwater inspections, we cannot stop Dalton from separating these unified services, but would ask that it reconsider for now and agree to meet to discuss whatever issues may have prompted that request. From the county's perspective, the respective city and county staff work together remarkably well for the benefit of all our constituents and the county would appreciate the opportunity to keep those services unified. If Dalton takes back building inspection, for example, there is every reason to believe that city taxpayers will see no financial benefit and may see increased costs, thus defeating the goals of our respective clients of promoting efficiency."

The letter closes with another request by the county to extend the current agreement until the end of next February and said the Board of Commissioners “is open to any good idea and none takes the position that their way is the only way.”

Dalton Mayor Dennis Mock said he had read the letter on Monday evening and called it “a really good start.”

“I am sure in the spirit of good negotiations we will carefully evaluate what they are proposing,” Mock said. “Our focus is and always has been to ensure the city taxpayers get the value for the services.”

Asked if he sees an agreement being reached by Thursday, Mock said that “remains to be seen.”

“At least we are firing back and forth and that is a really good start,” he said. “But it is way past the start and we need to be down to the nitty-gritty. We need to get it done if we can and that is our intent.”

Both Laughter and county Commissioner Roger Crossen said making a new service delivery agreement dependent on LOST renegotiation is a “non-starting point.” Both pointed to the previous LOST negotiations in 2012. They said the current ratio of county residents to Dalton city residents is 69% in the county and 31% in the city. Crossen said the upcoming 2020 census could see a population shift back to the county.

“If you look at population, the city of Dalton is 30-31% of the county and yet they getting almost 40% of the LOST,” Crossen said. “We thought they would be happy with that, but evidently that is not what is happening.”

When reached Monday evening, Dalton City Council members Tyree Goodlett and Annalee Harlan said they had not read the county’s response yet.

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