Schools and Revenue – A Few Basics

Here’s something that doesn’t happen every day: Approximately 550 people attended a parent-organized meeting at Brentwood Middle School Wednesday night.

And here’s another thing that doesn’t happen every day: A WCS parent asked if attendees would be comfortable with a property tax increase to pay for schools, and almost every hand shot up. Williamson County School Board member Jay Galbreath wrote on Twitter that he “didn’t see any hands that weren’t raised.”

The need to expand and update the Brentwood Middle/High School campus as well as the need to upgrade and expand Page Middle and High while continuing to build new schools and make capital improvements is highlighting the urgent need for revenue to meet the school demands associated with growth.

At Wednesday’s meeting, Mayor Rogers Anderson explained there are only three ways to increase revenue in the county – raising property taxes, raising the wheel tax, or raising the sales tax. A sales tax or wheel tax increase would both require a referendum.

District 6 Commissioner and former Brentwood Mayor Paul Webb said:

“We have to pay for it, and we have to have 13 votes [out of 24 County Commissioners]. And we can’t snap our fingers and do it. There’s a process. I am going to support the schools. My granddaughters are coming through. I am going to support it when we figure out the funding. We can’t just say go build it and bankrupt the county. We have to figure out how to do it, and we can’t change the property tax rate in the middle of the year.”

 

Property Tax

Property tax is based on the value of your home, so when the value of your home goes up, your taxes go up, right? Not quite.

State law limits counties’ ability to collect the rising revenue that would come with maintaining the same property tax rate in a rising market. After a reappraisal, the county adjusts its rate to bring in the same amount as under the previous valuation.

If a county wants to increase revenue, the County Commissioners have to vote to increase the rate from the (new) baseline.

The rate in 2015 was $2.31 (per $100 of a property’s assessed value). In 2016, Williamson County had a reappraisal that valued property at approximately $11 billion – about a $2 billion increase from the last reappraisal in 2010. The certified rate to pay the same amount in property taxes would have been $1.81. The Williamson County Commission passed a resolution to set the rate higher than the certified rate. They established $2.15. This rate represents the lowest tax rate in middle Tennessee and the lowest among Tennessee counties with populations greater than 100,000.

TaxRateMap

Whether your taxes went up or down still depends on the value of your specific property.

The 2016 rate:

Property Appraisal = $400,000

Assessed Value (25%) = $100,000

Property Tax Rate = $2.15 per $100 of a property’s assessed value

Property Tax = $100,000/100 x $2.15 = $2,150

The County Commission voted for this tax rate change right after they approved the budget last July.

Most of the same commissioners who voted against the county budget also rejected the property tax change – District 4 Kathy Danner (voted for overall budget) and Gregg Lawrence, District 6 Jeff Ford, District 8 Barb Sturgeon, District 9 Todd Kaestner and Sherri Clark, District 11 Brandon Ryan, and District 1 Ricky Jones (abstained from voting on overall budget).

Here’s what they said at the time:

“I think it is way too much of an increase. There are maybe three people on this commission who looked at the numbers in any kind of detail. We are giving wage increases of 4, 5 percent which is more than you see in the private sector. People use as an argument they love our employees, well, so do I but 5 percent last year and 4 percent last year is a 9 percent increase in the time I think private sector wages went up 1.5 or 2 percent.” – District 9 Commissioner Todd Kaestner

“Also we need to look at the school department. And what is the cost per kid, and nobody does that. We kicked the can down the road. But 18 percent? That is probably the biggest tax increase in the history of the county.” – District 9 Commissioner Todd Kaestner

“If we’re not able to sacrifice something, it just transfers to mom and dad homeowners. I’d like to personally work harder to prevent that.” – District 8 Commissioner Barb Sturgeon

 

Sales Tax

The state sales tax is 7%. Counties have the ability to tax up to 9.75%. Williamson County’s rate is currently 9.25%. Of the 2.25%, half goes to the county, and half goes to the municipality. 100% of the county’s portion is dedicated to schools.

Fairview has an additional 0.5% city tax that they would lose if the county increased the sales tax rate.

In March 2011, County Commissioner Ricky Jones pulled a resolution to call a referendum for a 0.5% local tax. The resolution had been approved by the Tax Study, Education and Budget Committees.

The Williamson County Republican Party fought a sales tax referendum.

“And coming from the leaders of ‘the most conservative-friendly county in America,’ it is disappointing.” – 2011-13 WCRP Chairman Kevin Kookogey

“Some of the proponents of the sales tax increase have sought cover by responding that since state law requires that a proposed sales tax increase be handled as a referendum, the people should decide. Yet what is conveniently omitted from the discussion is that it costs Williamson County taxpayers at least $100,000 just to send the matter to referendum.” – 2011-13 WCRP Chairman Kevin Kookogey

If the County Commission votes in favor of a sales tax referendum, it would have to occur in 75-90 days. If approved by voters, the sales tax would go into effect on the first day of the month occurring 30 or more days after the Election Commission certifies the results.

 

Wheel Tax

The current wheel tax in Williamson County is $49.75. $24 goes to the state, and $25.75 goes to Williamson County.

In November, the Maury County Commission considered raising the wheel tax by $25, but the resolution failed in the Commission’s budget committee.

In 2012, Sumner County rejected a referendum to raise the wheel tax by $25 by more than 60%.

A 2004 referendum to increase the wheel tax by $25 in Williamson County likewise failed 72%-28%. 100% of the additional tax would have gone to schools.

 

 

 

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