Yesterday's announcement by Sunnyside City Manager Bob Stockwell...that the city won't be collecting nearly $150,000 in new taxes from cell phone users...brings several thoughts to mind.
First, a little background. Our city council, back on June 12, approved a 6 percent utility user tax on cell phones. City officials at the time estimated the new tax would bring in between $125,000 and $150,000 annually, all of which was to be dedicated for law enforcement efforts in Sunnyside. Basically, that meant the Sunnyside Police Department was going to get to hire additional officers.
At that city council meeting two and a half weeks ago, Mr. Stockwell explained the state legislature had authorized cities back in 2002 to begin taxing cell phone users. "For some reason, the city didn't take advantage of that at the time," Stockwell said at the meeting.
Turns out, the city has been taking advantage of that 2002 ruling. Yesterday, Mr. Stockwell distributed a press release, pointing out the city has been collecting the 6 percent tax from seven large cell phone providers for the past several years. He goes on to say that other cell phone companies have not been collecting the tax, and additional research is needed to determine which companies must begin collecting the tax.
"The effect of this new information is that the estimated revenue from the tax is significantly less and therefore will not support additional law enforcement needs," Mr. Stockwell wrote in yesterday's press release.
Several thoughts come to mind on this matter, the first being the finger pointing. I'd say it's a sure bet that our former finance director, Bud Schatz, will be blamed for this bookkeeping oversight. He's been blamed for just about every other financial problem the city has encountered since he was ousted from city hall, despite the fact that during his tenure he was the architect of stockpiling more money in the city's reserve accounts than ever before in the history of the city. Remember back when the Tim Eyman initiative rolled back motor vehicle license renewals to a flat $30 fee, and how nearly every city in the state went into a panic mode because they were losing a critical revenue source from the state. Not Sunnyside. Under Schatz's financial leadership, this community virtually saw no changes in how operations were conducted.
But rest assured, Bud Schatz's name will be offered up by some as the culprit in this bookeeping snafu.
The second thought that comes to mind, if the city has been collecting this cell phone tax for several years, where has the money been going? Has it been put into a rainy day account, perhaps dedicated for upgrading the city's communication network or putting more cops on the streets? Or is it just part of the general fund? Has the city even been cashing the checks sent by these seven large cell phone companies, or are they stuck away somewhere in a desk drawer?
Thirdly, it seems to me the city has so many revenue sources, it can't keep track of them all. How can you continue to receive tax revenues for several years and not know you're receiving them? I guarantee you, when any form of cash hits my mailbox, I recognize it as extra income and put it to use accordingly. Makes you wonder if the city is dealing with more cash than it truly needs.
Lastly, I've got to wonder, if city leaders are so intent on beefing up the Sunnyside Police Department, why didn't Sunnyside's city leaders approve the request two years ago from a local couple to create a gaming establishment in town. The taxes paid into the county coffers by RC's Casino & Restaurant, which is commonly referred to as "the Sunnyside casino" by gaming enthusiasts from out of the area despite the fact it's located outside of the city limits, easily top $100,000 a year. Those taxes add up pretty close to the total tax revenues the city was expecting to receive from cell phone users. We could have had extra officers on the streets for the past year and a half or so.