July 16, 2009, was a very busy day in the financial crisis currently facing Jefferson County. First, Jefferson County Circuit Judge Joseph Boohaker ordered the Jefferson County Commission to reinstate funds to the Jefferson County Sheriff’s Department budget. Further, the Court directed both parties to negotiate in good faith to amend the Sheriff’s budget for the remainder of the fiscal year. At the same time, Governor Bob Riley refused to declare a state of emergency for Jefferson County, saying that his power to declare states of emergency does not cover financial crises. Additionally, the County Commission agreed in a civil lawsuit pending before Circuit Judge Scott Vowell that they would not take steps against Cooper Green Mercy Hospital without notice to the Court – while a protest against the County Commission’s proposed cuts to the hospital took place on the courthouse steps. And, to top it all off, the County Commission announced that the lay-offs of hundreds of workers may be avoided by 30-45 day leaves of absence, during which time the effected employees would continue to have insurance coverage.
Amid this swirl of activity, the legislative delegation continues to debate the necessity of enacting some new form of the occupational tax and how such a potential new tax could work legally. Jefferson County Representative John Rogers, in an interview with the Birmingham News, reiterated that he and other members of the legislative delegation approached the County Commission five years ago about the legality of the occupational tax and the necessity to fix it. Representative Rogers states that their overtures were rejected.
Judge Boohaker made an interesting finding on page 15 of his Order, based on the testimony of Jefferson County Director of Revenue and acting Finance Director Travis Hulsey:
Hulsey testified that though the budget approved provided for a transfer into the General Fund of $17,421,500 from the Bridge and Public Building Fund, this transfer was never made. The transfer would have been possible had this sum not been encumbered with the payment of debt obligations paid from the Bridge and Public Building Fund. However, the expected claims on the said fund were more than originally anticipated which meant that the said 17,421,500 transfer could not be made.
This finding raises questions not only about the management of the General Fund, which received approximately 24.5% of its annual income from the occupational tax, but also the management of other funds under the control of the County Commission. Not clear from Mr. Hulsey’s testimony is what debt obligations were paid with the $17,421,500 that could have been paid into the General Fund and that would have alleviated the short-fall currently faced by the County. When taken in consideration with the ever-changing position of the County Commission regarding its proposed cuts, more questions are raised than answered. There is no question that a major overhaul of the County’s financial operations will result from the invalidation of the occupational tax and that, taken in conjunction with the sewer debt debacle, a financial crisis looms. However, it becomes clearer each day that the issues facing Jefferson County extend far beyond the validity of the occupational tax.
