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• Gallery: Protest against proposed city occupation tax

HUNTINGTON — A controversial amendment was put back into Huntington’s proposed 1 percent occupation tax ordinance Monday, prompting protests and heated exchanges from the audience that City Council members are determined to give tax breaks to the wealthy.

By a 7-4 vote, council members placed a $125,000 limit on the amount of earnings that the city can tax, meaning someone who works in the city would pay no more than $1,250 annually in occupation taxes. Because the ordinance was amended, it was moved to a third reading — and likely a vote — at the Aug. 9 council meeting.

The amendment comes just two weeks after a $100,000 cap was removed from the occupation tax, which is one of three components of the city’s proposed tax reform package. A vote on the other two components, a 1 percent sales tax and eliminating or reducing portions of the business and occupation tax, were also postponed to the Aug. 9 meeting.

Dominating the conversation Monday night was the 1 percent occupation tax, which would take effect Oct. 1 of this year and trigger the repeal of the $3-a-week user fee. City officials are anticipating the occupation tax will generate about $8 million per year. The user fee generates $4.5 million annually. Altogether, city officials are projecting that the reform package would net an additional $3.5 million annually.

About 25 people, most of whom were employees of Steel of West Virginia, protested in front of City Hall before the meeting. Some circulated petitions that would force the occupation tax to a public referendum, while others held signs declaring that the proposal was taxation without representation.

“The majority of revenue generated by this tax will come from nonresidents of this county who don’t have a voice in this debate,” Janet Cross of Hurricane said during the meeting.

Cross slammed a penny down on the city clerk’s desk, a symbolic gesture that she will refrain from spending money in Huntington if the occupation tax passes.

“You can take this penny, but hell will freeze over before I spend any more money in this city,” she said.

Nina Barrett, chairwoman of Marshall University’s Classified Staff Council, took issue with the earnings cap. She cited the city’s median household income of $23,234 (according to the 2000 Census) and said most of the tax burden would be shared by the lower and middle classes.

 “To me, it seems like the burden is being skewed in the wrong direction,” Barrett said. “It would be only fair to not have a cap and let the higher-income people pay their fair share.”

The Classified Staff Council, which represents 638 employees at Marshall, opposes the latest tax reform package, Barrett said.

Council members who support the cap have maintained that removing it would prompt those who have the financial means to move their business or residence outside the city.

City Councilwoman Sandra Clements, who offered Monday’s earnings cap amendment, said she has received far more phone calls about the occupation tax than any other issue during her five years on the council. An overwhelming majority oppose it, but that will not sway her support for the tax, she said.

“No one wants to raise taxes, but we have to make some hard choices about where Huntington is going to go in the future,” she said.

Joining Clements in voting for the earnings cap amendment were council members Jim Insco, Nate Randolph, Mark Bates, Steve Williams, Russell Houck and Frances Jackson. Council members Scott Caserta, Teresa Loudermilk, Jim Ritter and Rebeccah Thacker voted against the amendment.

Clements, Jackson and Houck voted to remove the earnings cap from the ordinance two weeks ago.

Not everyone from the standing-room-only audience who spoke on the ordinance was against it. David Frederick, a West Pea Ridge resident who owns Argus Psychological Services in Huntington, said the occupation tax would not force him to move outside the city like other business owners have threatened.

Frederick said his support for the occupation tax is rooted in his distaste for the business and occupation tax and belief that Huntington needs more revenue to continue basic services.

“I’ve been here nine years and this is where I want to do business,” Frederick said. “I’m well prepared to pay this tax to make this city attractive.”

Sholten Singer/The Herald-Dispatch Protesters hold signs on the corner of Fifth Avenue and 8th Street during a protest against the proposed city occupation tax, July 26, 2010, outside of City Hall in downtown Huntington.

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