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| Property tax hike suggested |
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Posted: Wednesday, July 18, 2012 8:56 pm
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By CHRIS MENEES
Staff Reporter
The Obion County Budget Committee has recommended a six-cent increase on the inside combined property tax rate for Union City for the next fiscal year.
The recommendation was made by a 4-2 split vote of the committee during a budget hearing Tuesday evening at the Obion County Courthouse.
The Obion County Commission had voted in August 2011 to set the combined property tax rate for the county for the 2011-12 fiscal year at $2.07 outside and $1.63 inside the corporate limits of Union City on each $100 of taxable property — which provided revenue divided the following way: General Fund, outside rate 44 cents and inside rate 44 cents; Highway Fund, outside rate 7 cents and inside rate 7 cents; School Fund, outside rate $1.11 and inside rate $1.11; and Debt Service Fund, outside rate 45 cents and inside rate 1 cent.
It’s the existing inside rate of one cent for those inside the corporate limits of Union City for the Debt Service Fund — versus the current fiscal year outside rate of 45 cents — which has generated much discussion among the budget committee and county commission in recent months.
The matter was first approached by county officials at the May sessions of both the county commission and budget committee that Union City should be paying more than just one cent on debt service. While residents inside the corporate limits of Union City do not pay on county school system debts and have their own city school system, they pay on county debt service for other areas such as the port authority and capital outlay notes. The county jail was paid off this year.
The budget committee has voted to restore the seven cents which was cut from both the inside and outside School Fund rates last year, with both the inside and outside rates changing back to $1.18 for the next fiscal year.
There was also much discussion in May about the Union City School System’s loss of an estimated $90,000 under the county’s 2011-12 budget due to the seven-cent reduction allotted to the city and county schools. The seven cents represented about $250,000 in county education funding, which was made up in the Obion County School System with the use of county TVA funds.
Based on the budget committee’s recommendations Tuesday evening, if approved, the proposed tax rate for the 2012-13 fiscal year would remain at $2.07 outside and would increase to $1.69 inside on each $100 of taxable property. The revenue would be divided this way: General Fund, outside rate 40 cents and inside rate 40 cents; Highway Fund, outside rate 7 seven cents and inside rate 7 cents; School Fund, outside rate $1.18 and inside rate $1.18; and Debt Service Fund, outside rate 42 cents and inside rate 4 cents.
While the General Fund rate would drop four cents for both the inside and outside rates and the School Fund would increase seven cents for both to restore funding, the additional inside increase for Union City would come from the Debt Service Fund rate changing from one cent to four cents.
It is estimated that one cent on the inside rate generates about $17,000, while one cent on the entire county brings in about $50,000.
Commissioner Jerry Grady, a member of the budget committee, made the motion at Tuesday evening’s budget hearing for the Debt Service Fund rate to be 42 cents outside and to increase to four cents inside. Commissioner Ralph Puckett, also a budget committee member, said it is fair.
From the audience, commissioner Norma Fowler suggested the committee should wait and research the matter further, and fellow commissioner Dwayne Hensley questioned making one municipality pay more and said Union City contributes significantly to the county library, industrial development and other areas. Puckett responded by saying South Fulton residents pay the current $2.07 outside rate plus their own city’s taxes.
Hensley implored the committee to not impose an increase which would create a hardship. He said all those involved should be given an opportunity to provide input and county officials should talk with city officials.
Commissioner Donnie Braswell, also in the audience, said county officials should meet with city officials to discuss the matter and it should be brought before the full county commission for a vote. He emphasized that Union City officials should be involved and should come to the commission to provide their input, but he also said he believes everyone should pay their fair share.
Commissioner Danny Jowers, chairman of the budget committee, said if the inside rate is being raised, city officials should have a voice in the decision. He said Tuesday evening’s action is simply “a recommendation” from the budget committee and there will be ample time to meet with city officials to find a fair solution before the next county commission meeting.
Grady reiterated that four cents is what is needed to pay the countywide debt and he said everyone should pay it.
The budget committee members who voted in favor of recommending the $2.07 outside rate and the increased $1.69 inside rate to the full county commission were Grady, Puckett, Allen Nohsey and Terry Roberts. Voting against it were Jowers and commissioner Richard Arnold.
Other action
In other action during Tuesday evening’s 70-minute meeting, which was opened with prayer by Hensley, the budget committee:
• Considered an appropriation request from the county library and approved a motion from Grady to not fund last year’s 2 percent salary increase for library employees but to fund it this year if a 2 percent raise is given to county employees. Last year’s pay raise for county employees was absorbed by the various departments, but the library was not able to do so without a financial strain. Grady questioned what would prevent other departments from coming back to ask the county to fund the 2 percent provided last year.
• Approved the 2012-13 fiscal year budget for the Highway Fund. Two line items changed for an insurance increase for worker’s comp, but the totals remained the same as previously presented.
• Considered the School Fund and School Lunch Fund, giving the nod to both and expressing appreciation to Obion County Director of Schools David Huss and the school board for their efforts in working with the commission on budget matters.
• Approved a revised budget for the county’s health department in the General Fund. A state grant was increased to $130,600 for a staff increase; the grant is reimbursed 100 percent to the county.
• Approved changes to funds previously approved, including the Solid Waste Fund, Drug Fund and General Fund. Certain line items were increased and others reduced, with totals remaining the same.
Budget committee vice chairman Sam Sinclair Jr. was absent from Tuesday evening’s budget hearing.
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Staff Reporter Chris Menees may be contacted by email at cmenees@ucmessenger.com. Published in The Messenger 7.18.12 |
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