Lowndes Nest Egg Continues to Pay

LOWNDES COUNTY, Miss. (WCBI) — Lowndes County’s $30 million nest egg from the sale of the county-owned hospital continues to pay dividends.

County supervisors are expected to withdraw $942,000 from the interest earnings last year. That’s on top of the $924,000 the county withdrew last year. Part of last year’s funds are being used to build two community centers. The remainder will be added to this year’s withdrawal for other potential capital improvements, ranging from a new 911 office to the county’s share of the extension of the Columbus Riverwalk.

Those decisions will be made later this spring. Even with the withdrawal, the trust fund will have almost $30.5 million.

The county sold the hospital seven years ago to Baptist Health Systems and agreed to put the $30 million principal in savings and spend the interest on capital projects. For the first few years, the county earned significant returns while traditional investment interest rates were high. But when those dove four years ago, earnings dropped as low as $51,000 in a year.

The Legislature authorized new investment options with strict controls but since the county started using those methods on Oct. 7, 2013, it has earned $2,357,031. Under the county’s investment rules, it can withdraw up to 3 percent a year as long as the total doesn’t drop below $30 million.

Meanwhile, the tax man is cracking down on cities and counties across the state. And it means changes in the way they do business.

Lowndes County agreed Monday to pay the IRS $22,609 for failing to deduct taxes, Social Security and Medicare in 2012 from employees who took county cars home from work, plain-clothes investigators and drug agents who received a uniform allowance and constables who were paid fees for serving warrants.

The IRS won’t audit the county for the last two years as long as it begins proper procedures this year. It’s also not charging interest or penalties.

Lowndes County already had taken steps to correct the take-home-car issue and some other matters.

“They (IRS agents) were appreciative that we had acted proactively.; They say they don’t see that very often,” County Administrator Ralph Billingsley told supervisors.

It’s part of audits the federal tax agency is doing state wide so virtually every local government will face some payments.

 

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