Rhea County commissioners warily eye tax increase

Rhea County commissioners warily eye tax increase

October 26th, 2012 by Tom Davis in Local Regional News

Rhea County Councilman Bill Graham

Rhea County Councilman Bill Graham

POLL: Should Rhea County have a wheel tax?

DAYTON, Tenn. - A property tax increase and a wheel tax are under consideration as Rhea County commissioners on Thursday studied the county's financial situation and need for a jail or justice center.

Budget committee Chairman Ron Masterson said, "Basically, at the end of this [fiscal] year if we have no additional expenses, which is highly unlikely, and property is assessed at a lower figure, the prospect for making a budget next year is bleak at best."

Finance Director Bill Graham reminded commissioners they budgeted some $691,000 in surplus funds to balance their budget this year, which means they would need about $1.2 million in fund balance, contrasted with the $352,000 in that category presently.

"The way expenditures are coming in compared to revenues, we're going to run a deficit again," Graham said.

Commission Chairman Jim Reed told commissioners that a 25 cent property tax increase would bring in about $1.2 million, but that option is not open until the 2012-14 fiscal year. A $50 wheel tax would yield about $1.1 million.

"If we passed [the appropriate resolution) at the November and December meetings, it could go into effect in January," Reed said.

While commissioners discussed the feasibility of either type of tax increase, Masterson encouraged them to take the information "back to your constituents. We have a workshop before our [November] meeting. I'd like to put something on the agenda that we want to do. We can't keep putting this off."

On the matter of relieving overcrowding at the jail, Reed said, "We've worked on this for two years. I think we should purchase property on Highway 27 until we reach the point of doing something. [Building at the site of the present jail] is not cost-effective."

Sheriff Mike Neal said he was told Thursday that the state jail commission would accept purchase of property as a positive step that would relieve the threat of imminent jail decertification.

But Commissioner Ronnie Raper objected, saying, "Purchasing property is not going to give [the sheriff] relief now."

Neal responded, "We need it now, but you're broke. You can't do it [build] now."

Graham said to finance a $15 million note for 20 years, the estimated cost of the project, would cost about $1.2 million per year. Neal added that savings and increased revenues made possible by a new facility could provide all but about $400,000 of that total.

"I think we helped the commission understand the situation we're in, and see what each other is thinking," Reed said after the meeting.

Commissioners will meet in workshop session Nov. 13 to develop an agenda for their regular session the following week.