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LOST mediation fails; arbitration may be next
Hall County, cities remain at odds over split of sales tax money
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Negotiations on how Hall County and its municipalities will split sales tax revenues will continue after mediation was halted Tuesday.

According to Gainesville officials, local option sales tax revenue-sharing mediation lasted for “less than half a day” before Hall County ended discussions with the cities.

“We just couldn’t come to an agreement, so the decision was made to end mediation,” Gainesville City Manager Kip Padgett said.

In August, LOST revenue-sharing negotiations between leaders in Hall County failed to reach a conclusion and, per law, mediation was required.

LOST revenue is meant to help offset governments’ reliance on property taxes to fund day-to-day operations. How it’s distributed is determined every 10 years following a federal count of the population.

Hall County has proposed it keep about 75 percent of that revenue, nearly the same as the current agreement.

The county’s municipalities want to see that number at around 58 percent and have said they deserve a larger portion because of their individual economic impact.

But even though mediation failed, county and city officials said they are hopeful talks will come to fruition before the next, and final, step: arbitration.

“There’s still an opportunity for the county and the city to continue the dialogue,” said Randy Knighton, Hall County administrator. “We want to take advantage of the opportunity we have, the window that’s open, to continue the dialogue and we’re committed to doing so.”

Knighton said he hopes the entities can come to an agreement before the end of the year.

Arbitration, if any of the parties decide to file for it, will be held in superior court. An outside judge will be called in and only one offer — either the county’s or the cities’ — will be accepted.

“The next step in the law is arbitration, but we hope we can work something out before that,” Padgett said.

Tuesday’s mediation session was closed to the public and specifics of that mediation have not been released.

“The mediation is confidential,” said Phil Sutton of Sutton Consulting. “It’s a part of the litigation process.”

Sutton said it’s not unusual for the two sides in a case like this to file a joint petition with the court system. In fact, he believes the county and the city have discussed it.

Denny Galis out of Athens was mediating at a rate of $250 an hour.

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