Jonesboro lawyers' tax case back in Clayton County

By Ed Brock

A lawsuit filed by three Jonesboro lawyers who claim the city's occupational tax is unconstitutional has seen a change in attorneys and a change in venues.

Attorneys Joseph Todd, Joseph Baker and Leon Hicks filed the suit on Nov. 21 in Clayton County Superior Court in which they claim that the city's occupational tax would regulate their ability to practice law and such regulation can only be performed by the Supreme Court of Georgia. However, the lawsuit was sent to federal court for a while due to the constitutional challenges it made, Todd said.

"It lingered up there for several months," Todd said. "Now the parties have agreed to remove it back here."

Also at the beginning, the Jonesboro City Council voted to replace former city attorney Steve Fincher with current attorney Buddy Welch. The change was not connected to the case, Jonesboro Mayor Joy Day said, but was made after the council considered several attorneys for the position.

Now that the case is back in Simmons' courtroom, Todd said he hopes to have a hearing on it within 90 days.

"We're trying to get a stipulation of facts together so the judge can make a ruling on the constitutionality of what's going on," Todd said.

The judge can decide the case then or decide that it should go to a jury trial. Todd said he plans to make several other motions and may seek to have the city refund the occupational tax money collected from all attorneys operating in the city since the tax was collected.

Welch was out of town Monday and Day said she could not directly comment on the case.

"I think it could have far reaching effects for other cities (if the tax is found unconstitutional)," Day said. "But I feel secure in the fact that we have the Georgia Municipal Association behind us and we will prevail."

The occupational tax, roughly the same as a business license, can be paid as a flat fee of $200 a year plus a $50 administrative fee or the fee plus $1.14 on every $1,000 earned in their gross receipts, Deaton said. The taxes make up about 7.5 percent of the city's total revenue, Jonesboro Occupational Tax Clerk Sharon Deaton said.

According to the lawsuit the occupational tax ordinance is "an unconstitutional pre-condition on the practice of law, and therefore impermissibly seeks to regulate the practice of law which is within the exclusive jurisdiction of the Supreme Court of Georgia."

Simmons ruled against a similar lawsuit filed by attorney Lee Sexton against the city about five years ago, Baker said previously, but on appeal the Supreme Court found the city's previous ordinance to be unconstitutional on two points. A new ordinance was written and approved two or three years ago, Fincher said when he was still the city's attorney.

"I think the new ordinance contains some or at least one of the same infirmities," Baker said.

According to the Supreme Court decision on Sexton vs. Jonesboro, the previous ordinance was unconstitutional because "it required registration and fee payment prior to transaction of business, required display of certificate indicating compliance ? and provided for criminal penalties for attempting to conduct business without paying tax."

The current lawsuit also claims that the new ordinance is an improper regulatory fee because it "is in effect, a precondition for a license to engage in the practice of law."

However, Fincher said that the previous ordinance said that lawyers "shall not practice law" without paying the tax, whereas the current ordinance simply says that attorneys are subject to being fined if they practice law without paying the tax.

"We understood what the court said when it ruled (in the previous lawsuit) and we amended the ordinance to take care of that problem," Fincher said.