Kingsport Times-News: Speak now or hold your peace on proposed tax increase, county budget
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Speak now or hold your peace on proposed tax increase, county budget

J. H. Osborne • Aug 30, 2017 at 12:00 PM

BLOUNTVILLE — The Sullivan County Commission is expected to vote Thursday on raising the county property tax rate by about 8.5 cents to help fund the county’s proposed $179.4 million budget for the fiscal year that began July 1.

Thursday is a state deadline for approving a budget. Commissioners got their first look at the proposed spending plan last week.

According to the proposed budget, the county is estimated to use nearly $2.5 million in fund balances over the course of the year, drawing down from a total of nearly $28.6 million to about $26.07 million. Hardest hit in the drawdown is the general purpose school fund, which will begin the year with a beginning balance of about $8.99 million and is projected by June 30, 2018 to have an ending balance of about $6.72 million.

The proposed tax rate of $2.55 (per $100 of assessed value) is projected to generate more than $94.73 million (compared to about $91.43 million generated by last year’s rate). That’s based on each cent of the rate bringing in $371,501 (compared to $354,985 last year before this year’s countywide reassessment) and a collection rate of 96 percent (the same rate that has been used to estimate revenue in prior years).

Where the $94.73 million will go:

• The county’s general fund will receive about $29.35 million (compared to about $27.39 million last year).

• The solid waste fund will receive $705,000 (compared to about $710,000 last year).

• The Sullivan County Highway Department (which does not provide service inside the cities) will receive about $2.79 million (compared to about $2.8 million last year).

• The general fund for schools, which is shared with city systems (because city residents pay county property taxes), will receive $50.26 million (compared to $52.21 million last year — meaning the cities’ shares will be less this year). The proposed budget shifts 5.5 cents of the tax rate from the general purpose school fund to the county’s general fund.

• What has previously been called the “school capital” (renovation city and county) fund has been renamed “county capital outlay — renovation” to reflect the county’s decision to no longer split this taxpayer money with the city systems. The tax proposed tax rate will generate $3.45 million for this fund (compared to $3.43 million last year).

• The county’s debt service fund will receive more than $8.17 million (compared to about $4.89 million last year).

That increase to debt service can be traced to the county’s issuance of $140 million in bonds to borrow money for school facilities projects, the proceeds of which were shared with Kingsport’s and Bristol Tennessee’s school systems.

Last year the county’s budget included nearly $6.74 million in spending for debt service. This year’s proposed budget includes nearly $12.67 million in spending for debt service. That figure includes $5.88 million to pay interest only on that $140 million bond debt. Property tax is not the only revenue generator for debt service. Others (such as $780,000 in interest earned on school bond proceeds) bring the fund’s projected total revenue to nearly $12.95 million for this budget year.

A required public hearing on the proposed tax increase is scheduled for 8 a.m., followed by a required public hearing on the overall budget at 8:30 a.m. and the start of commission business at 9 a.m. The hearings and meeting are scheduled to be in the commission room on the second floor of the historic Sullivan County Courthouse.

 

 

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