"A fiscally conservative budget." That's how Hamilton County Mayor Jim Coppinger described his proposed county budget for fiscal year 2013-14 on Thursday.
True, Coppinger's budget calls for no tax increases. But is the announcement of "no new taxes" good enough?
The proposed budget tops out at more than $664.2 million -- almost $5,000 per Hamilton County household. Coppinger's new budget calls for a $21 million increase over last year's budget. That 3.3 percent spending hike dwarfs the 1.3 pecent overall U.S. inflation rate over the past year. In other words, Coppinger is growing the budget over twice as much as should be reasonably expected.
Still, it seems Coppinger and other county leaders are under the impression that if they don't increase taxes, they've done their jobs. Since Hamilton County residents pay far higher county property tax rates than residents in the six bordering Tennessee counties, simply keeping tax rates the same is just not good enough.
Hamilton County's tax rate is 2.7652 percent. The adjacent county with the highest property tax rate is Marion County with a tax rate of less than 2.17 percent. Bradley County's property tax rate is a comparatively miniscule 1.792 percent. At 1.7496, Rhea County resident's property tax rate is less than two-thirds of Hamilton County's toll. (These tax rates reflect only county rates and do not include additional city property taxes.)
These seemingly tiny percentages add up to significant money for residents. Since Tennessee counties collect property taxes on 25 percent of the appraised value of a property, a Hamilton County resident with a $200,000 home pays $1,383 in county property taxes annually. A Bradley County resident would pay just $896 in county taxes on the same $200,000 home -- a difference of nearly $5,000 over the course of a decade.
Many Bradley County residents would argue that the services available to them are just as good as those in Hamilton County (Bradley County schools, for example, are better by most measures), so it makes no sense to pay an additional $5,000 a decade for the "privilege" of living in Hamilton County.
Therein lies the problem for Hamilton County. Since the county has a high tax rate compared to surrounding areas, but doesn't give residents much in the way of additional benefits or amenities as a result of the extra tax dollars they pays, it won't be long before many Hamilton County residents flee for the greener pastures of the surrounding lower-tax counties.
In order to prevent an exodus of Hamilton County residents, Coppinger and the members of the Hamilton County Commission should take a knife to the county's budget and start trimming the fat -- and there's plenty of it.
For example, Coppinger's budget proposal calls for $900,000 of taxpayers' money in discretionary funds for county commissioners to spend on their own pet projects. Given the county's excessive property tax rate and the number of county residents struggling to make ends meet in the tough economy, it's unconscionable to spend tax dollars in such a frivolous and wasteful way.
The budget proposal also calls for $26,500 to buy a 4-door pickup truck for the Recreation Department, $53,000 for new trucks for use at the Enterprise South Nature Park, $8,100 for fitness equipment for the Health Department, $5,000 new for conference room furniture at the Nursing Administration and $1,450 so the county medical examiner can have a new filing cabinet. It seems that some of these budget increases could easily be reduced or eliminated in the name of lowering taxes.
If Coppinger's budget is accepted, the Sheriff's Department will get an additional $2 million next year over the current year's budgeted amount. The Circuit Court clerk's office budget will increase by $337,000, the Chamber of Commerce will get a $600,000 handout to continue its questionable attempts at economic development and the county's giveaway to the Urban League will double from $50,000 to $100,000. In an apparent attempt to keep up with tough job of overseeing all the cash the county is frittering away, the accounting arm of the County Finance Division is even requesting an additional $101,000 for the next fiscal year.
In the context of Hamilton County's high taxes and the litany of questionable expenditures filling the proposed budget, Mayor Coppinger's claim that his budget proposal is "fiscally responsible" seems dubious and even irresponsible.
Hamilton County's leaders have a few short weeks before they need to adopt a new budget. During that time, they need to go to back to the drawing board and get serious about cutting expenses so they can lower taxes. The future of Hamilton County depends on it.