New law gives counties, like Marion County, grace period on budgets

Kimball City Attorney and Marion County Attorney Billy Gouger
Kimball City Attorney and Marion County Attorney Billy Gouger

JASPER, Tenn. -- Governing bodies like the Marion County Commission are supposed to approve the next fiscal year's budget by July 1 each year, but many across the state fail to do so.

Instead, those boards typically approve continuing budget resolutions so they can continue operating under current spending guidelines until the new budget is passed.

A recent amendment to state law revamps that procedure and includes at least one stipulation that could cause problems for being tardy.

Marion County Attorney Billy Gouger said the new law eliminates the need for the board to adopt a continuing budget resolution.

"If you don't have your budget passed by July 1, you just continue to operate under the prior year's budget for two months," he said.

If the budget is not approved by Aug. 31, the county would be required to apply for a one-month extension through the state comptroller's office.

County Mayor David Jackson said the request for that extension must be submitted to state officials no later than Aug. 15.

"Sept. 30 is a true deadline," Gouger said.

The "caveat" to eliminating the need for a continuing resolution is that government departments can't spend more money per month than their average spending under the old budget, he said.

"That could be an issue if you have an unexpected expenditure or purchase while you're in that grace period," Gouger said.

Commissioner Tommy Thompson said he hoped the board would have a budget passed before having issues like that.

"I've seen a time or two when we didn't," he said.

In other business, the board unanimously approved a resolution supporting changes to a state law requiring counties to pay homeowners-association fees on properties acquired through a back-tax sale.

"Essentially, [the requested change] would give counties the discretion on whether to bid properties in a tax sale," Gouger said.

The modification would add the words "financial burden" to the description of properties that counties aren't required to take if property taxes aren't paid.

"[State law] already has a provision in there for properties that pose an environmental risk," Gouger said. "This will simply add properties that could also impose a financial burden as those that the county can exclude from the sale."

The push to change the law originated in Loudon County. Officials there believe homeowners-association fees from acquired properties may add up to between $500,000 to $1 million in that county alone.

Since counties acquire back-tax properties involuntarily, officials believe it is unfair that they should be responsible for paying the homeowners-association fees, too.

Ryan Lewis is based in Marion County. Contact him at ryanlewis34@gmail.com.

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