The town of Signal Mountain could lose roughly $120,000 from its current fiscal year budget due to a possible tax exemption for a portion of Alexian Village.
The town is already facing looming budgetary threats in the form of the Hall tax potentially being eliminated in the next several years, as well as possible changes to how state-shared sales tax is distributed. Town officials say they are investigating options for appealing Alexian’s tax exemption.
“Any time you realize a reduction in revenue is a possibility, then you have an obligation to citizens to try to prevent that loss and protect the revenue source,” said Town Manager Boyd Veal.
The council has asked Town Attorney Phil Noblett to research whether the town has any power to do anything.
“I’ve been in contact with an attorney, and if we decide to take any action, it will have to be by December 28,” Noblett reported.
“They [the council] will have to talk about changes in the upcoming budget meetings if nothing can be done,” said Noblett. “They’ve got a lot of decisions ahead. Once we’re aware of all of our options, then we’ll decide whether to take action.”
Chris Curran, vice president of communications for Ascension, which Alexian Village is a division of, said, “The tax status of Alexian Village of Tennessee has not changed. It has always been a nonprofit organization. The Tennessee State Board of Equalization recently reaffirmed this and agreed to continue to honor certain existing property tax exemptions to our skilled nursing facility, chapel, assisted living and other facilities.”
The independent senior living facilities in Alexian Village are not tax-exempt, and will still, in any case, pay a regular property tax to the town.
Veal said this is the first time the town has had to deal with this sort of situation, and although the time frame for action is short, officials are trying to get all the information available for the best likelihood of a positive outcome for the town.
“If there’s an avenue to pursue and it’s determined that it would be a productive endeavor, then we will definitely look into it,” he said. “Whether we can do it or not is a separate question from whether it would be successful. The council will make that decision once we know what’s possible.”
Both Veal and Noblett agreed that the town has to be wary of any possible loss in tax revenue, especially in light of the potential losses of the Hall tax and state-shared sales dollars.
“Any municipality who relies on a small budget will be hurt more by any reduction in the amount of tax money they’ve relied on. They still have to supply services and pay employees, and when you start cutting into that, it’s definitely a problem,” Noblett said.
Email Shane Foley at sfoley@timesfreepress.com.