COVINGTON -- The Covington City Council has agreed to give a full tax refund totaling more than $23,000 to Bridgestone Sports USA following a reporting error by the company.
Bridgestone filed a claim with the county on personal property taxes for tax years 2006 and 2007 totaling $108,419.07. A little more than $23,000 of that represented taxes paid to Covington.
The county has yet to decide whether to grant a refund and has one year after the request to make a decision. That deadline is up in November.
Mayor Kim Carter said the last word from the county was that the attorney's office was researching the matter.
"We just don't like to wait until the last minute to discuss situations," she said during the council's Oct. 4 meeting, adding that the city is under no legal obligation to refund the money.
Councilman Chris Smith recommended refunding half the amount.
But Councilman Mike Whatley said he wanted to keep a good relationship with the company.
"Anybody we've got, we need to keep and keep in good standing with them," he said.
Councilwoman Janet Goodman made the motion to refund the full amount, which passed 5 to 1, with Smith in opposition.
According to Tax Commissioner Barbara Dingler and Chief Appraiser Tommy Knight, Bridgestone incorrectly valued its equipment on tax returns, placing it in a classification higher than it should have been. The returns were sworn and signed by Bridgestone's treasurer. The Tax Assessors Office accepted those values and Bridgestone was billed accordingly.
After Bridgestone reported the error, its assets were reclassified as required by law.
"We must recommend a new assessment regardless of whose error (it is). It's up to the Board of Commissioners to determine if a refund is valid. This is money that was collected, spent and distributed for those fiscal years and the governing authority says yea or nay on if we give the money back or not," Dingler previously told the Citizen.
In other news, the council approved a switch from a defined benefit to a defined contribution retirement plan for city employees.
Human Resources Director Ronnie Cowan said the city's plan is well-funded and "not in any trouble at all," but noted that in the next 30 years the cost of maintaining the plan will get more expensive, as people are working and living longer.
"Before it becomes a problem, we want to address it," he said.
New hires after Jan. 1 will enroll in a defined contribution plan. About 10 employees who have been with the city for less than a year and do not yet have retirement benefits will also be under the new plan. Current employees will have the option of staying with the defined benefit plan or switching to the new plan.
"The whole world's moving that way. It seems like governments are the last to get on board," Carter said. "It's all about dollars and cents. (The defined benefit plan) is not a sustainable program."
The council unanimously approved the new plan. Policies regarding sick leave and early retirement will be addressed at a later date.
Finally, the council agreed to table a draft ordinance from Fire Chief Don Floyd that would address outdoor burning within city limits. Currently, the city allows outdoor burning with a permit, but the ordinance does not contain rules or penalties. Floyd said no permits have been issued during his 39 year tenure with the fire department due to air quality and safety concerns, except for bonfires and destruction of vegetation when land is cleared.
"As fire chief, I would recommend the city not issue burn permits. I just think it's best not to, but we'll comply with whatever you decide," Floyd told the council, adding that he wanted to have something in place addressing regulations.
Councilman Chris Smith said he thought issuing permits could help cut down on costs to haul and dump vegetation at the landfill and said allowing people to burn under certain conditions "could be a win-win for the homeowners and the city."