Property Tax Rate
Set At $1.4987;
Will Be Adopted
The Greene County Commission narrowly approved an $82.63 million budget for the 2008-09 fiscal year that began July 1, and set a property tax rate of $1.4987, the same as the state-certified rate.
The approved budget gives non-school county employees a 2.3 percent raise, and does not raise taxes above the rate calculated to bring in the same amount of revenue as the 2007 rate, which was $2.11.
The budget actions came in three separate votes, after considerable debate, much of it about whether the commission could provide more funds to the county school system for pay raises and electricity.
The commission also voted to adopt the International Building Code, effective Jan. 1. (Please see accompanying article.)
County Director of Schools Dr. Joe Parkins asked the commission to raise taxes by 5 cents for raises and higher electricity costs. An increase was never actually discussed, though a motion was made to reallocate 2 cents without increasing the overall rate. The motion never came to a vote, however. (Please see another accompanying article.)
The total levy approved Monday for property outside the city limits of Greeneville is $1.4987 per $100 of assessed valuation. This is the same levy that was set by the state's Board of Equalization in June, after the five-year reappraisal of county property was completed this past spring. Last year's "outside" rate was $2.11.
The total county levy for property inside Greeneville is $1.3066 in the new budget. Of this total "inside rate" levy, $0.5015 is to be allocated to the county's general fund, $0.1287 to the county Highway Department, $0.5534 to the General Purpose School Fund, $0.365 to general debt service, $0.025 to the Self-Insurance Fund (which covers liability and buildings), and $0.0615 to the Solid Waste Department.
Property owners outside of Greeneville also pay this rate, but in addition are also taxed for constructing county schools. This year, a levy of $0.1921 goes into the Education Debt Service Fund for school use, and when combined with the $1.3066 equals the $1.4987 "outside" rate. (Last year, 25 cents of the $2.11 property tax rate went to fund school construction.)
The vote on the tax levy, the first on the agenda, passed 18-3, with only three commissioners, Kevin Morrison, Clark Justis and John Waddle Jr. voting in opposition.
The vote on the appropriations budget was 11-10, the narrowest possible majority, and the vote on the county government's contributions to non-profit agencies was 15-6.
The vote was 11-10, with "no" votes from Jerry Weems, Fred Malone Jr., Tim White, John D. Carter, Kevin Morrison, Clark Justis, John Waddle Jr., Betty Ruth Alexander, Jan Kiker and Brenda Grogan.
Voting "yes" were: Bill Brown, John Cox, William Dabbs, Alex Edens, Margaret Greenway, Rennie Hopson, Phil King, Robbie Morgan, Bill Moss, Sam Riley and Hilton Seay.
Before the vote, some commissioners who are
employed by the county read a statement declaring that their votes reflected their conscience or the
views of their constituents.
The vote on the county's contributions to non-profit agencies followed almost immediately, and was approved 15-6, with only Carter, Morrison, Morgan, Edens, Waddle and Grogan voting "no."
Road Funding Approved
In a related move, the county commission then voted unanimously to issue $390,000 in six-month capital outlay notes. The action will make that amount of money available to the Greene County Highway Department, for purchasing badly-needed asphalt.
After the meeting, Road Superintendent David Weems said the $390,000 would be about enough to pave four miles of roads with hot-mix asphalt two inches thick. But Weems said the asphalt would most likely be used for patching, which would enable it to cover 12 miles or more of county roads.
Weems cut about $800,000 out of his chronically-underfunded budget during the budget-making process this summer, after cutting about a million out early in the process. The capital-outlay note was an attempt by the budget committee to make amends, and provide at least some funding that the Highway Deprtment can use for asphalt this summer.
The note is to be paid for out of the general debt service fund, and retired in six months.
The resolution setting the tax levy was approved 18-3 with little discussion. Commissioner John Waddle Jr. asked County Sheriff Steve Burns if the four employees moved from the county detention center to the patrol division would require new cars. Burns said no new cars will be needed, and most of those employees will move into dispatching jobs.
The next item on the agenda was the appropriations budget, which in essence is the entire budget document.
Commissioner Morrison spoke at length when this resolution was introduced, pointing out that the undesignated fund balance had fallen from $6.2 million in fiscal 2006-07 to just over $4 million last year, and is projected to be $3.39 million this year.
Later, Budget Director David Lawing said that once the 2007-08 budget (which ended June 30) is completely closed, the undesignated balance will probably rise to about $5 million.
Lawing also pointed out that part of the reason for the drop was use of that funds to build the new driver license station (which will generate revenue until it is purchased from the county by the state) and to remodel and enlarge the county Health Department building (to accommodate larger numbers of primary care patients because of reductions in TennCare (Medicaid) coverage in recent years).
In response to a question from Commissioner Waddle, Lawing said that no major capital projects are in the new budget.
Morrison and others pointed out that the new budget uses $686,000 from "our savings account," meaning from the undesignated balance, to make the county's overall 2008-09 budget balance.
"We're robbing our savings account," Morrison said.
He asked, "Who gives raises out of the savings account? Raises are perpetual."
Morrison said the budget, as presented, "is not balanced, it's 'balanced' with money out of our savings account," and said that practice can only continue until the savings is depleted. "A tax increase is coming," he said.
Later, Commissioner John Cox asked Budget Director Lawing if it is factual to say that money for raises came out of savings. Lawing said this is "somewhat" true, but gasoline and diesel prices have risen sharply, as have the prices of food served to prisoners.
"You can blame it on employee raises, but the majority (of the spending increase) is for electricity, gasoline" and inflation in many prices, the budget director replied.
Lawing agreed with Morrison's point about a property tax increase down the road, saying that it has been five years since the county schools got an increase in the property tax levy, and six years since the other departments received an increase.
He said other county departments are being hit just as hard by increases in the cost of fuel, food and electricity, and "the property tax is not going up with inflation," because it is designed not to increase, by state law.
Morrison said his own home was appraised $229,000 higher this year. But Lawing pointed out that the rate by which the new appraisal is multiplied "went down," as it did for every property owner.
The property tax is "generating a constant amount in an inflationary period," Lawing said.
If inflation continues, it will force the county government to reduce services it provides, or raise revenues, the budget director said while pointing out that few county services can be cut without creating dangerous situations.
Cox said he "never signed up" to spend money that is not being replaced "on a recurring basis."
Commissioner Jerry Weems said, however, "That's what we did," last year, and this year.
Weems asked Lawing if it was accurate to say that the county government spent more money than it took in last year, and will do the same this year.
Lawing replied that is the case. "We absorb inflation that way," using the fund balance, Lawing said. "The only other option is to start cutting services."
Morrison said that, "for the last two budget cycles, appropriations were outrunning revenues, and that can't happen for long."
Morrison then proposed changing the tax levy to give 2 cents to the school system, from the 50 cents allocated for the general fund.
Lawing said that action would remove more than $250,000 from the general fund, because a penny at the new tax rate generates about $127,000.
When County Mayor Broyles asked Morrison how he would handle that decrease, Morrison said he believes the $5 million said to be in the fund balance will cover it.
Broyles said, however, if the increase in electricity costs is as high as now anticipated, then the county's general fund will have to cover increases for all county departments, as well as increases in fuel costs that are already hitting the Sheriff's Department and Emergency Medical Services.
Morrison made a motion to move two pennies from the general fund to the school system, and it was seconded by Commissioner Jan Kiker.
Because the tax levy had already been approved as presented, and Morrison's motion to amend the levy came during discussion of appropriations, not levy, it was not immediately apparent how best to proceed.
Mayor Broyles asked for a short recess to allow time to ask advice. After about 15 minutes, Broyles reconvened the meeting, said he had made calls and decided the best course would be to go ahead and vote on budget appropriations.
In the event that the vote on appropriations failed, he said, then the commission could consider a motion to rescind the tax levy resolution, and then to amend it as Morrison proposed.
This decision had the effect of turning the vote on appropriations into a referendum of sorts on Morrison's motion about giving two additional pennies of the levy to schools.