Mayor says state told Granville businesses to collect
An email circulated Thursday morning indicated that a number of businesses outside the city of Morgantown — Granville businesses in particular — were previously notified by the state that they needed to start charging Morgantown’s 1% sales tax, which went into effect on Wednesday.
According to the email, from Granville Mayor Patty Lewis to Morgantown Mayor Bill Kawecki, many of those businesses are now unwilling to stop collecting the additional tax until they receive additional guidance from the state.
“In our initial call to the state tax department yesterday, we were told this is our problem, not theirs,” Lewis explained in the email.
Morgantown Finance Director Jim Goff said that he nor his office have received any communication from businesses or officials in Granville or anywhere else about receiving improper notice from the state.
“If their businesses were receiving notices that they shouldn’t have been receiving, I would have liked to have had that information ahead of today,” Goff said. “This feels like a gotcha situation. Like the city of Morgantown screwed up again. Well, we did everything we possibly could with the limited system that we’re provided to implement this. We worked hard and spent a lot of hours trying to get that together.”
Goff explained that he and GIS Analyst Marvin Davis, along with other city staff, spent months going back and forth with the state using the state’s mandated procedure — nine-digit zip codes, or zip-plus four — to parse out who’s in and who’s out.
Once the city got the all clear from the state, there was no additional communication regarding which businesses would receive notice to begin charging the tax, Goff said.
According to Davis, there are more than 5,900 nine-digits zip codes in the city. He said that, per direction from the state, any zip code that straddled the city boundary was considered out.
Goff conceded that the process is imperfect, particularly when it comes to scenarios like businesses outside the city that have P.O. Boxes in Morgantown.
There are essentially two ways to correct it, he said. One is two hear from business directly and two is a thorough review of the report that comes with the first quarter collections, at the end of September.
He said every city in West Virginia with outlying development and a sales tax has been through this process.
“It’s not a perfect process, but with the zip code plus four being the only option we had, which is the state’s option and the state’s requirement, that’s what we utilized and that was the best situation we could get,” Goff said. “We’ve reviewed it thoroughly and I don’t know what else to say about that.”
In the meantime, any business outside the city that was told to begin collecting the tax or any customer who notices they’re paying the tax at businesses outside Morgantown, should contact the city’s finance office.
“We want it to be right. We don’t want to collect taxes from anybody that we’re not supposed to,” Goff said.
As for the possible reimbursement of any sales taxes collected improperly, Goff said he will have to question the state tax office about it.
“I don’t think we can reimburse. I mean, if you go to Lowe’s and buy something, you’re the one paying the extra 1%, not Lowe’s. So giving the money back to Lowe’s wouldn’t be the way to go,” he said.
In her email, Lewis points out that businesses in Granville went through a similar situation in 2016, when Morgantown implemented its $3 weekly user fee.
“That situation at least allowed the businesses to refund that money to their employees before it was submitted to the City of Morgantown,” Lewis said.