Rhea may try to undo sales tax hike

DAYTON, Tenn. — The state attorney general has been asked to rule whether Rhea County can keep all the revenue from a half-cent sales tax increase voters approved in August, rather than sharing with Dayton, Graysville and Spring City.

If not, some county commissioners favor holding a vote to rescind the tax.

“What’s the quickest we can get this on the ballot?” Commissioner John Mincy said at a workshop last week. “This is not the way we presented it to the voters. That’s my heartburn with it.”

Mr. Mincy said recent reports show the sales tax increase is generating about $52,000 a month. But the county’s share is only about $9,000, with the rest split between the three cities.

County commissioners have said that since the sales tax increase was specifically written to raise money for school improvements, only the governments that operate schools should get the money. That’s Rhea County and Dayton.

County Executive Billy Ray Patton said Dayton is entitled to all the revenue the sales tax increase generates inside the corporate limits, currently about $34,000 per month.

But Commissioner Bill Hollin responded, “That’s not what the people voted for.”

Mr. Patton added, “Based on figures from the Department of Revenue, we expected between $500,000 and $600,000 per year in revenue. If we were getting the increase from Graysville, Spring City and Dayton, we would be on target.”

Finance Director Billy Graham said the county’s share is enough to finance a bond issue of $5 million to $7 million for school construction. Commissioners said that won’t be enough to address school building needs.

County Attorney Carol Barron said Attorney General Robert Cooper Jr. has been asked to rule on the distribution.

Mr. Hollin added, “We ought to go to the (Dayton) council and see if they would share their increase with us. If not, we have the right to put (repeal of the increase) on the ballot.”