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County officials increase tax rate on city residents

County officials increase tax rate on city residents
Staff Reporter
Obion County’s budget for the next fiscal year — including a 6-cent increase on the inside combined property tax rate for Union City — was approved by the county commission Monday night.
The tax rate with the city’s increase was accepted by a vote of 14-5 during an evening session of the Obion County Commission that lasted just 25 minutes at the Obion County Courthouse.
With the commission’s action, the tax rate for the 2012-13 fiscal year remains at $2.07 for the outside rate and increases to $1.69 for the inside combined property tax rate. The recommendation was made last month by the county’s budget committee and unanimously approved by its finance committee.
The revenue is divided this way: General Fund, outside rate 40 cents and inside rate 40 cents; Highway Fund, outside rate 7 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 decreased 4 cents for both the inside and outside rates from last year and the School Fund increased 7 cents for both to restore funding cut in the last fiscal year, the additional inside increase for Union City comes from the Debt Service Fund rate changing from 1 cent to 4 cents.
At budget meetings, it has been explained that the 4 cents proposed for the inside tax rate for debt service is for general obligation for services which benefit everyone — including Cates Landing, trustee’s commission and courthouse repair — and commissioner Jerry Grady has stated the outside rate should actually be 36 cents for debt service and the inside rate should be 12 cents.
Figures provided by county officials at an Aug. 6 budget committee meeting show a total countywide debt of $209,063 for the year — which includes $150,000 for a capital outlay note; $12,813 for the port authority; $500 for interest on the capital outlay note; $45,000 for trustee’s commission; and $750 for loan fees.
The school debt is $1,146,038 — which combined with the countywide debt brings the total to $1,355,101.
It is estimated 1 cent on the tax rate generates $17,564 inside Union City and $31,962 outside Union City, according to the figures. If the inside rate was 12 cents, it would generate $210,768; and if the outside rate was 36 cents, it would generate $1,150,632 — for a total of $1,361,400.
County administrative assistant Kay Calhoun clarified to budget committee members that the outside share of the debt service tax rate required for countywide debt is added to the outside rate for school purposes. This would make the inside rate 5 cents, rounded off. The recommended rate is 4 cents inside.
At Monday night’s Obion County Commission meeting, finance committee chairman Tim Doyle made the motion to accept the recommendation to set the tax rate at $2.07 outside and $1.69 inside. It was seconded by Grady.
Several Union City officials and city residents were in attendance, but no one from the audience addressed the commission.
Noting the silence, commissioner Dwayne Hensley said he felt everyone had already made their decision, but he said he wanted to go on record by saying the decision to increase the tax rate will not help city/county relationships. He said it will also hinder industrial recruitment.
It was mentioned that the city rate had to increase at least 2 cents, regardless, to restore the school funding
On a roll call vote, the motion to set the tax rate was approved 14-5 — with commissioners Jim Bondurant, Richard Arnold, Norma Fowler, Hensley and Allen Nohsey voting against it.
Afterward, Union City Mayor Terry Hailey said county commissioners “cited something about schools and debt service that won’t pass the smell test.”
“Union City council members — five of whom were in attendance — were not pleased. In my opinion, there was no reason for us to argue before the commission as it was obvious their minds were made up,” Hailey wrote in a Facebook post which he quoted during his radio station’s news broadcast this morning.
“I appreciate city commissioners Jim Bondurant, Dwayne Hensley, Allen Nohsey and Richard Arnold for voting against the increase. I was extremely disappointed in city commissioner Sam Sinclair, who voted for it. One penny on the inside rate raises $17,000 for the county. So, for $102,000 out of a $46 million budget, the commission has set back city/county relations maybe back to the beginning. Or, in more common terms, city residents have been screwed again — and not the first time this year,” he claimed.
County budget
In acting on a countywide budget for the 2012-13 fiscal year, prior to addressing the controversial tax levy, the Obion County Commission first approved appropriations to the county’s various funds, departments, institutions, offices and agencies, as well as to several non-profit organizations, for the year which began July 1 and ends June 30, 2013.
The county’s appropriations total $8,330,873 in the General Fund; $157,926 in the Solid Waste/Sanitation Fund; $53,000 in the Drug Control Fund; $7,487,816 in the Highway/Public Works Fund; $27,731,826 in the General Purpose School Fund and $2,421,626 in the Central Cafeteria Fund; and $1,355,101 in the General Debt Service Fund.
The $79,465 appropriated to non-profits for the next fiscal year includes $4,000 to the Obion County Fair Association; $10,000 to the Obion County Rescue Squad; $14,465 to the Veterans Service Office; $11,000 to the Obion County Joint Economic Development Council; $3,000 to Community Developmental Services; $27,500 to the Obion County Senior Citizens Center; $1,000 to Boys & Girls Clubs of Northwest Tennessee; $5,000 to the American Red Cross; $2,500 to the Carl Perkins Center; and $1,000 to Northwest Tennessee Disaster Services.
Approval of both the county and non-profit appropriations were contingent upon adoption of the proposed tax rate. The appropriations were recommended following several rounds of budget hearings in recent months.
The county’s appropriations were approved on a 15-3 vote, with county commissioners Bondurant, Ms. Fowler and Hensley voting against the resolution and commissioner Danny Jowers citing a conflict of interest as a county employee.
The non-profit appropriations were OK’d by a vote of 18-0, with commissioner Terry Dwyer citing a conflict of interest.
In another budget-related item, the commission approved the Obion County Public Library’s budget for the 2012-13 fiscal year, as presented by librarian Michele Barnes.
In other action during Monday night’s meeting, which was opened with the Pledge of Allegiance and with prayer led by Arnold, the commission:
• Appointed Neil Dodson to fill a vacancy on the Obion County Highway Commission for District 6, created by the recent death of Baxter Sanders.
• Accepted a financial report for the Indigent Care Trust Fund.
• Approved 10 notary public applications.
• Delayed a report from the county’s insurance committee due to the illness of chairman Cloney Taylor.
In addition to Taylor, commissioner Kenneth Cheatham was absent from Monday night’s meeting.
Staff Reporter Chris Menees may be contacted by email at
Published in The Messenger 8.21.12

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