On January 12, 2009, Judge David Rains, sitting by designation in the Circuit Court for Jefferson County, entered an Order upholding the repeal of the Jefferson County Occupational Tax. Hill | Turner LLC, has the privilege of representing the taxpayers of Jefferson County in this case. We are taking this opportunity to explain what this case is and is not about.
First, this case is not about bankrupting Jefferson County or the sewer debt debacle that we hear so much about. This lawsuit was filed in May of 2007, long before the headlines about bond insurers and defaulted payments gained negative national attention for Jefferson County. Nor is this a lawsuit about the fairness, or lack of fairness, in how the old tax was applied.
What this case is about is far more simple – trusting our elected officials to work together and follow the laws of this State for the betterment of our community.
Under Alabama law, the Jefferson County Commission cannot unilaterally enact an occupational tax. That power is reserved to the State Legislature.
Judge Rains detailed the history of the occupational tax in his Order. The key developments as they relate to our case are as follows: In 1999, the Jefferson County delegation to the Alabama Legislature voted to repeal the occupational tax. The County Commission filed a “very friendly” lawsuit (as Judge Rains identified it in his Order) to invalidate the repeal on procedural issues related to how the Alabama Legislature counts its votes. The County Commission continued to collect the tax. In 2005, a case decided by the Alabama Supreme Court determined that the courts of this State could not tell the Alabama Legislature how to count its votes.
Judge Rains’ decision follows the law as spelled out by our Supreme Court. The law was clear: the legislature had legally repealed the tax, and the County Commission chose to ignore that repeal instead of working with our delegation to fix the problem. Workers in Jefferson County were paying a tax that was not valid. Judge Rains agreed, and now the repeal stands. Though Judge Rains stayed the execution of his Order until the current legislative session ends on May 18, 2009, we expect any appeal to be decided favorably for the taxpayers of Jefferson County and that there will be refunds to the taxpayers at the conclusion of this case.
We know the issue of the occupational tax won’t end here. The County Commission has already voted to take this lawsuit further through an appeal to the Alabama Supreme Court. However, we are hopeful that the County Commission will do what we, the taxpayers and voters in Jefferson County, expect of them and work with the legislative delegation to do the people’s business.
Judge Rains’ order gives both the County Commission and the Jefferson County legislative delegation the opportunity to demonstrate leadership and restraint. Although the Alabama Constitution prohibits the Legislature from eliminating the remedy handed down by Judge Rains as to the old occupational tax, the legislature can, with the involvement of the Commission, adopt a new, fair, universal, occupational tax.
If there is going to be an occupational tax in Jefferson County, it needs to be legally enacted by the Alabama Legislature and implemented by the Jefferson County Commission. As voters and taxpayers, we hope these bodies will take into consideration not only the well documented financial problems our County Commission has created, but also the difficult financial circumstances faced by our citizenry. The occupational tax is only but a symptom of the problems faced by Jefferson County – it is not a cure. The real cure can only come when our elected officials put aside their egos and work together to do the jobs we elected them to do – no matter how much they personally dislike the result. The future of Jefferson County depends on it.
