For Immediate Release
City, Alltel Reach Out-of-court Settlement
The City of Springfield and Alltel Communications LLC have reached an out-of-court settlement over collection of business license gross-receipts tax.
Under the settlement agreement approved in a closed City Council session on Sept. 8, 2009, Alltel Corp. today paid the City of Springfield $5,918,788. This amount represents the settlement’s net proceeds of back taxes owed. Alltel has been paying the gross-receipts taxes since September 2006 and that money has been appropriated in the City’s annual budget since that time.
The Springfield City Council on Sept. 10, 2009, approved a resolution stating a series of commitments to address the Police-Fire Pension Fund shortfall if the sales-tax referendum is approved on Nov. 3. Because this settlement was reached prior to Nov. 3, the Council will need to formally decide how to appropriate the net proceeds.
“Obviously this requires official City Council action, but I believe Council’s intent is to place 100 percent of these net proceeds into the pension fund to demonstrate our commitment to resolving this issue,” Mayor Jim O’Neal said.
Alltel will pay attorneys fees and costs associated with the settlement directly to the City’s outside legal counsel.
The settlement results from a lawsuit the City filed in U.S. District Court in Jefferson City in May 2004, naming SBC (now AT&T landline), Sprint, Alltel, Cingular (now AT&T Mobility) and Nextel as defendants. The City reached a settlement agreement with Sprint Nextel in September 2007 for $2.375 million, of which the City netted $1.54 million from the settlement.
The City reached a settlement with AT&T Mobility in May, 2009, in which the net proceeds of $10.22 million were deposited into the Pension Fund.
One suit remains outstanding with AT&T’s landline company, which was formerly SBC.
For more information, contact: Assistant City Attorney Nancy Yendes, (417) 864-1642.