A new ordinance designed to bring money into the city by charging a licensing fee on insurance companies is being considered by the Benham City Council. Mayor Shirley Dodd introduced the idea to the council.
“Cumberland has done this and Lynch has done this,” said Dodd. “It’s a way to generate some money.”
City Clerk Jessica Smith explained the ordinance to the council.
“Cumberland’s had it in action since before 1995,” said Smith. “It’s a percentage of insurance monies that they collect. It comes from life, automobile, any kind of insurance that does business inside the city limits.”
According to Smith, the city would collect a percentage on payments to insurance companies doing business inside the city in order to generate income.
Dodd said she had been advised Cumberland made approximately $120,000 per year from such an ordinance.
“What you’re saying is our town can generate funds from large insurance companies?” asked council member David Kidwell.
Council member George Massey inquired if this would have adverse effects on the residents of Benham.
“It’s from the insurance companies,” said Smith. “it’s not on the citizens, it’s actually from the big companies.”
Dodd said the city of Lynch recently passed a similar ordinance.
“We’re on a timeline here,” said Dodd. According to Dodd, the ordinance must go in effect by March 31 or the city will have to wait a year for the ordinance to take effect.
The timeline I’m running on is March 28,” said Smith. “So it’s something that’s going to be quick.”
Smith then performed the first reading of the ordinance for the council.
“An ordinance adopting a new license fee upon insurance companies for the privilege of engaging in the business of insurance within the corporate limits of the city of Benham…establishing license fee rates as 8 percent,” read Smith.
The license fee is to be imposed on all insurance companies doing business in Benham. The types of insurance affected include casualty, automobile, inland/marine, fire, health and life insurance.
The council plans to have a special called meeting to perform the second reading and vote on the ordinance sometime next week.
In other council activity:
* The week of April 15-19 was designated for the spring Pride Cleanup for the city of Benham;
* The council tabled the issue of requesting a state audit in order to collect more information concerning costs.
Reach Joe P. Asher at 606-573-4510, ext. 113, firstname.lastname@example.org