PARKERSBURG, W.Va. — Households and businesses in the city will save an average of $100 a year after the elimination of the business and occupation tax on electric and gas utilities, according to a letter being sent out with this month’s municipal fee bills.
The B&O on those utilities was eliminated, along with the B&O on manufacturing, while the rate for retail and restaurants was cut by 30 percent as Parkersburg implemented a 1 percent sales tax under West Virginia’s expanded home rule program.
The B&O cuts were originally planned to go into effect on Jan. 1, 2016, to give the city time to gauge the amount of revenue coming in from the sales tax. But an opinion from the state attorney general’s office forced the cuts to begin July 1.
Councilwoman Kim Coram, chairwoman of the Finance Committee, said recently the city should start looking at how to reduce and eventually eliminate the $2.50-a-week user fee charged to everyone who works within the city limits as a way of giving money back to citizens.
Mayor Jimmy Colombo asked for the letter to be distributed to show people they were already getting money back with the B&O charge on utilities gone.
That tax had generated approximately $1.35 million a year, according to the letter, a copy of which was provided to the newspaper Monday by Finance Director Eric Jiles. By law, utilities could pass that tax along to their customers, but must reduce rates accordingly if the B&O was cut or eliminated.
“While each household and/or business within the City benefits based on their proportionate share of the savings, on average the annual savings is approximately $100 per household and business,” the letter says.
Some customers were still assessed the B&O surcharge in July, as utility companies didn’t have enough notice of the change to adjust rates in time.
The letter urges residents to check their bills to confirm the reduction.
Some council members and the previous administration proposed reducing other costs, such as the fire, police or floodwall fees. The initial projection was for the sales tax to generate about $3 million for the 2015-16 fiscal year, but Jiles recently said it could be closer to $4.35 million.
Colombo said Monday he’s not interested in looking at such reductions at this time.
“I don’t know where you would get that kind of money,” he said, citing expenses such as $300,000 every four years to hire divers to inspect the floodwall pumps.
The mayor said the city needs to dedicate additional revenue it has to beneficial purposes and not rely so much on grants. Community Development Block Grant funding and other sources are declining.
“Why can’t we plan to make the city better?” he said. “Is it wrong to say I want to pave a highway or a road? Is it wrong to say I want to make the parks better?”
“If you give it back, you’re just the same way … we have our hands out every week,” Colombo said.
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