Sandy Springs TSPLOST revenue still low; audit sought

Sandy Springs’ revenue from the new special transportation local option sales tax continues to remain significantly lower than expected, concerning city officials enough to call for an audit.

And Mayor Rusty Paul is contacting members of Congress to rename local ZIP codes for his city rather than Atlanta, a confusion that he fears is misdirecting sales tax collections elsewhere.

The TSPLOST, which boosted the Fulton County sales tax to 7.75 percent, took effect April 1 and was expected to raise more than $100 million for Sandy Springs projects alone, several of which are now underway.

City Finance Director Karen Ellis reported last month that TSPLOST revenues were about 30 percent lower than expected at that point: about $5.6 million rather than $8 million. At the time, officials said there was no cause for alarm, but now they are expressing more concern.

“TSPLOST is down. It has not gotten any better” since the city’s inquiries to state revenue officials last month, Ellis said at the Nov. 21 City Council meeting. Ellis said she called for an audit and was told that Fulton County officials are preparing to conduct one, as sales tax revenue in all Fulton cities is down.

City Councilmember Gabriel Sterling said that Fulton County Chief Operating Officer Todd Long had told him that Fulton’s tax revenue is down about 10 percent. Sterling said that Sandy Springs’ share, however, is even lower – about 20 percent.

County spokesperson Jessica Corbitt confirmed that TSPLOST revenues are down and that an audit of businesses’ collection practices is likely.

“Overall, since TSPLOST began April 1, revenues countywide are approximately 15 percent lower than those projected by Georgia State University,” Corbitt said.

“While we understand that sales tax revenue can be affected by a number of factors,” Corbitt said, “the TSPLOST Citizens Oversight Council anticipates requesting an audit from the Georgia Department of Revenue to ensure that all retailers in the taxing jurisdiction are collecting and remitting the 0.75 cent [additional] TSPLOST sales tax.”

Paul repeated the city’s longstanding fears that sales tax could be miscalculated or sent to the wrong city due to businesses using software that report sales by ZIP codes. Many local ZIP codes use the preferred name “Atlanta” even when the addresses are actually in Sandy Springs.

The ZIP code issue remains a largely unsubstantiated suspicion founded on anecdote rather than audit, and civic pride and branding are other factors in the ZIP code naming desire. City officials have been unable to cite an example of a business sending sales tax to the wrong city. Earlier this year, a local Starbucks coffee shop was charging customers the city of Atlanta’s higher 8 percent sales tax, which it corrected when contacted by the Reporter, but it is unclear where that money went. The state Department of Revenue says it has a system to check tax collections against city-provided lists of business addresses.

Regardless, Paul said he recently contacted U.S. Sen. David Perdue and U.S. Reps. Karen Handel, John Lewis and Barry Loudermilk to seek a federal law requiring the U.S. Postal Service to use “Sandy Springs” as the preferred name on local ZIP codes.

“I hate to take an act of Congress to do it, but it seems to be the only outlet we got,” Paul said.

Update: This story has been updated with comment from Fulton County.