Argo Mayor

Editor’s Note: This is part one of a two part series focusing on Argo’s attempt to dig out of its financial quagmire.

When current Argo Mayor Paul Jennings took office on November 3 of last year, he walked in to the Argo Town Hall to find a stack of papers marked “unpaid bills” which totaled about $350,000. Since then, he has spent nearly every working hour trying to find solutions to pull his town out of debt incurred from the previous administration.

“We have crunched some numbers to where they’re just crumbles now,” Jennings said. “We’re financially in a bad shape. We’re trying to use reality to govern us. That’s not what the prior administration did. They inflated things to make it look good.”

Jennings said that even if Argo didn’t have the debt that it drug in from the prior administration, that the economy is down and that does not bode well for a town that has a $1 million debt to Metro bank for a new town hall that cannot be used because of a clause that states that the warranty will be void if the town occupies the building before construction is completed.

“We’re having to swallow a big problem,” he said of Argo’s financial woes. “Our sales tax is down considerably. Business licenses are down. Argo was one of the biggest growing areas a few years ago. To my knowledge, there’s not one house under construction right now.”

The price for doing business in St. Clair County is nominal compared to other counties in the area. But for Argo, its revenues are down partly because the city has three zip codes. Therefore, money that homebuilders have paid for lumber, concrete and other resources purchased in Argo sometimes go to surrounding cities like Trussville and Odenville, which share two of the three zip codes in the town.

Jennings found that since 2006 Argo has not been receiving its full sales tax. “Some builders are providing invoices that show that bills were being sent to the wrong towns,” he said. “That had been brought to the prior administration and this invoice was delivered to them and they did nothing about it. I’ve contacted Montgomery and they’re willing to come in and audit some of these (problems).”

Not having its own zip code is part of the tax collection problem in Argo.

Jennings, who was also mayor of Argo from 1996-2004, said that the zip code problems have been around for decades. “What we’re doing—and have done in the past—is finding that some of our sales taxes went to the wrong entity and within about six months [auditors in Montgomery] corrected it.”

Around the turn of the millennium, Argo had problems getting its money that it was due and contacted Montgomery. Jennings explained what the difference was from his first terms as mayor, “I had figured [the difference in revenue] was about an $1,800 loss; but it was more then $12,000.”

Jennings repeated his town’s current debt problem. “We are definitely financially impaired,” he said.

Argo now stands with $350,000 in what Jennings refers to as “current debt.” Those are debts from the previous administration that include: payments on two fire trucks that haven’t been made; a BP credit card with an outstanding balance of $11,000 has been cut off as of October and a phone bill to Windstream that totals $17,000 for 40 phone lines that were active in the new, unused town hall.

Jennings called the phone lines “something very interesting. I had the phone cut off when I first saw that bill at first of December.”

The phone bill was $1394 per month for new building.

Jennings said that it has been a daunting task weeding through the unpaid bills.

“I though that when I came in here I’d find problems,” he said. “It seems like every week we find something new.”

St. Clair County passed an ad valorem tax eight years ago. It stated that money collected from the tax was to be spent on equipment only. But Jennings said that the former administration used that money to pay city salaries.

The more Jennings and his staff dig, the worse it seems to get. “Evidently there’s no consequence. We have requested a state audit and we met with the gentlemen and requested they look into it. We have a two-cent per gallon gasoline tax earmarked for roadwork. In August and September [of 2008] there were two entries out of that account where the clerk took out $35,000 out of the gas tax and put it in general fund to pay bills.”

Argo’s fire department woes did get an economic boost this week. U.S. Senator Richard Shelby (R-Ala.), a senior member of the Senate Appropriations Committee, announced on Monday that the Department of Homeland Security would release $37,240 to Argo Fire and Rescue. The funding is provided through the Assistance to Firefighters Grant Program.

“This grant will assist Argo Fire and Rescue in funding its operations and safety programs,” said Shelby. “It is critical that our nation’s first responders are adequately prepared for any event. This grant is an example of our continued support for our nation’s firefighters.”

Coming next week: A closer look at Argo’s $1.5 million headache and how it came to be.

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