Washington, DC-The Senate Governmental Affairs Committee today approved by a unanimous vote legislation (H.R. 1953) that would prohibit Kentucky from taxing Tennesseans who work at Fort Campbell.
Chairman Fred Thompson (R-TN) sponsored the legislation in the Senate and said: "It is unfair for folks who work at Fort Campbell but live in Tennessee to be forced to pay income taxes to Kentucky when they receive absolutely no services from Kentucky. As I see it, Tennesseans are paying the freight to Kentucky but are getting nothing in return."
The measure would reduce the tax burden on more than 2,200 Tennesseans who work on the Kentucky side of Fort Campbell.
The legislation also provides tax relief to employees who work at two other federal facilities-the Columbia River Hydroelectric Dams and the Gavins Point Hydroelectric Dam. These installations each straddle the border between two states, one of which has an income tax and one of which does not.
An amendment offered by Senator Bob Smith (R-NH) that would have added the Portsmouth Naval Shipyard to the list was rejected by a vote of 5-10 in large part because a boundary dispute exists between New Hampshire and Maine regarding the location of the shipyard. Thompson, who voted against the amendment, believes that the border dispute should be resolved before Congress takes action on the shipyard, and he encouraged the attorneys general of Maine and New Hampshire to settle the dispute as expeditiously as possible.
In a Nov. 4 letter to New Hampshire Attorney General Philip T. McLaughlin, Thompson said: "I certainly sympathize with the plight of the New Hampshire residents who work at the Portsmouth Shipyard and are taxed by the state of Maine.... If it is determined either by the States of Maine and New Hampshire or the Supreme Court that the border between the two states lies within the Portsmouth Shipyard, I will give my full support to legislation to prevent Maine from taxing New Hampshire residents employed on the Maine side of the federal facility."
The bill will now be placed on the Senate Calendar and awaits action by the full Senate.
Source: U.S. Senate Committee on Homeland Security and Governmental Affairs
