ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Monday, July 15, 1996 TAG: 9607150113
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: CHRISTINA NUCKOLS STAFF WRITER
BUT THE LEGAL ISSUE wasn't resolved when Roanoke city settled with the company about taxes.
Roanoke County officials are sizing up the chances of getting Cox Communications on their tax rolls now that the cable company has settled a dispute with Roanoke city over gross receipts taxes.
County Attorney Paul Mahoney said he expects to make a recommendation to the Board of Supervisors in September or October on whether it should pursue efforts to levy the Business, Professional and Occupational License tax against Cox.
County officials had hoped that the debate between Cox and the city would result in a legal determination of whether cable television companies are subject to the tax. In an out-of-court settlement, however, Cox agreed to pay $125,000, or roughly half of what the city says Cox owed when it moved into new offices in the county in August 1994. That leaves the legal issue unsettled.
Roanoke County has never sent Cox a bill, but Commissioner of the Revenue Wayne Compton said he met with the company's attorney this spring to discuss the issue. No decision was reached, but Compton said the discussion was amicable.
Compton said he ultimately would decide whether Cox should pay the tax, since he distributes bills for BPOL. He said the supervisors' role would be to decide the rate at which Cox would be assessed. Cable companies are often treated as business services, which are taxed at 36 cents per $100 of gross receipts, but some localities set up separate categories for cable television, Compton said.
Compton believes Cox is taxable because other localities levy BPOL against cable companies. Twenty-three counties, 46 towns and 15 cities in Virginia - or about 40 percent of the state's localities - impose the tax on cable providers.
Supervisor Chairman Bob Johnson believes the board would back efforts to add Cox to the county's BPOL payers.
"Somebody needs to explain to me why they should be treated different," he said.
He expects only one strong opponent on the board, Cave Springs Supervisor Fuzzy Minnix.
Minnix said charging the BPOL tax would open Cox up to "a double shot," since the company already pays a franchise fee to the county based on the number of subscribers. Cox pays about $400,000 annually under the franchise fee. BPOL would add an estimated $90,000 to $100,000.
"Cox Cable is not going to pay this," said Minnix, whose district includes the Cox Communications office. "You know who's going to pay it: the people who turn on and off the televisions."
Cox spokeswoman Gretchen Shine said it's early to tell whether customers might be affected by a new tax. She has said cable rates would not increase because of the settlement with the city.
Minnix believes Cox eventually will be charged the BPOL over his objections.
"What I sense is yes, it's going to be done, even if we have to go to court," he said.
Cox jointly negotiates franchise agreements with the county, the city and the town of Vinton. Under the agreement that ended in 1991, Cox was allowed to pay franchise fees in lieu of BPOL. The franchise agreement that took effect in May 1991 and continues today does not exempt Cox from BPOL.
LENGTH: Medium: 70 linesby CNB