Hamilton County school board member ready to sue state

$14.5 million annually is at stake for schools

photo Jonathan Welch

The Hamilton County Department of Education loses out on about $14.5 million annually because Tennessee doesn't fully fund the school district through its Basic Education Plan.

That missing state money could be used to hire elementary school art teachers, bring new technology to classrooms or boost teachers' pay, school officials say.

It may be time to go to court and sue to have the formula fully funded, said school board member Jonathan Welch, whose District 2 includes Signal Mountain and Walden.

"It's been talked about for years," Welch said.

He thinks the school district gets the runaround because county commissioners tell school district officials to get more money from the state. And local state legislators, Welch said, say they can't help Hamilton County.

"Our local delegation is unable to get it funded or get the formula changed," Welch said.

So Welch has asked the school district's attorney, D. Scott Bennett, to look into the feasibility of filing suit. The missing $14.5 million of BEP money is more, Welch said, than the $11.7 million the school district got in a settlement with the city over unpaid liquor tax money.

If it doesn't make sense to sue, Welch is OK with that. He just wants to figure out what the school district's options are and put the issue to rest.

"It's time to quit talking about it. We've talked about it for 10 years, hearing there's a problem," Welch said. "I'm kind of tired of hearing about it, so I want to put it to rest one way or another."

Local property taxes must be used to make up the shortfall caused by a lack of state funding for state-mandated proposals, he said.

The school district hasn't gotten a local tax increase since 2006, schools Superintendent Rick Smith said. The county added 16 cents then per $100 of assessed value.

We saw this east of our office in north Springdale.

Posted by NWADG on Wednesday, March 25, 2015

Smith said, "$14 million would certainly help."

One thing that inspired Welch to call for full state funding was news Friday that state House Majority Leader Gerald McCormick, R-Chattanooga, filed legislation that would cut Tennessee's sales tax rate from 7 percent to 6.75 percent. Meanwhile, other legislators want to eliminate Tennessee's Hall income tax on stock dividends and bond interest.

Welch said the tax cuts -- which he normally would applaud -- are being proposed while the state hasn't fully funded education.

McCormick said there are only two ways the state could increase Hamilton County's Basic Education Plan funding: Take money away from rural counties or raise taxes.

The state gives more money per student to rural counties, because rural counties don't have the same tax base that larger counties do.

"They don't have the same retail base that we have," McCormick said, adding that, "The rural people don't think they get their fair share."

"I don't foresee any tax increases," McCormick said. "I don't have any constituents knocking on my door asking me to raise their taxes. Maybe Mr. Welch does. He's not bothered to contact me about this, but I have been working on this issue for many, many years."

Contact staff writer Tim Omarzu at tomarzu@timesfreepress.com or www.facebook.com/tim.omarzu or twitter.com/TimOmarzu or 423-757-6651.

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