Sales tax audit results in boon for county and cities

Grady County and the cities of Cairo and Whigham along with other jurisdictions around the state recently received a big boost in their sales tax collections for the month of September.

According to officials, the Georgia Department of Revenue has completed a three-year audit for the years 2015-2108 of various businesses of a certain type using the same software to report sales taxes. Due to a coding error, all sales taxes remitted to the state were reported as state sales taxes.

The disbursements for October, which are based on September sales, included the one-time distribution of $247 million owed to cities and counties where these businesses were located.

This resulted in nearly double the amount of monthly collections of sales taxes by the county, two cities and also the Grady County Board of Education.

Grady County finance director Holly Murkerson reported to county commissioners this week that the distribution of Local Option Sales Tax to the county jumped from $134,594.30 in August to $314,112.36 in September. Special Purpose Local Option Sales Tax also increased from $146,260.57 in August to $314,112.60 in September.

Cairo’s share of the SPLOST is $202,042.28 in September compared to $91,504.29 in August. Whigham saw its SPLOST collections jump from $4,527.56 in August to $9,996.88 in September.

Cairo city manager Chris Addleton said Tuesday the city received $202,042 in LOST proceeds for September, which is a little more than double what the city normally collects on a monthly basis.

Whigham city clerk Lisa Calhoun said Tuesday that Whigham’s monthly LOST collections average $4,200 per month but for September the city received $9,997.39.

The Grady County Board of Education does not benefit from LOST, but it does collect ESPLOST and finance officer Dan Broome reports that the school system received an additional $289,713.89 for September over and above its average monthly collection of approximately $240,000.

State officials have warned local governing bodies that the one-time distribution covers a three year period and local officials should not expect the increase as a “new normal.”

“Regardless, we are glad to have something go our way for a change,” Grady County administrator J.C. (Buddy) Johnson III, said Tuesday.

In addition to the extra sales tax proceeds, the city of Whigham, like the county and City of Cairo, also benefited from the federal CARES Act pandemic relief legislation. Whigham city clerk Calhoun reported this week that Whigham received $7,286.80 in round one and $17,002.53 in round two of Phase I CARES Act funding for a total of $24,289.33.

There is additional federal money being held by the state that could provide additional benefit to local governments, but those funds and spending requirements have not been released to-date, according to city manager Addleton.