The Rutherford County Commission is scheduled to vote on a proposed property tax increase Wednesday at 9 a.m.
Last Monday, a public hearing drew comments from 19 people, most of whom had negative comments about raising taxes.
“We’re very much aware that there’s people out there that would be hurt by an increase in taxes,” Budget, Finance, and Investment Committee chairman Robert Peay said.
But Peay also said he believes that some who are against the proposed increase have a few mis-conceptions about the budget, such as not knowing that some funds will help people with disabilities, veterans and elderly people.
The tax hike was initially proposed at an amount of 9.5 percent, or 20 cents on the current rate of $2.0994 per $100 assessed value. The new tax hike being proposed is 19.5 cents. (That number could change before the final vote Wednesday.)
But what would that extra money go to?
According to Rutherford County Finance Director Lisa Nolen “Seven cents will go to the general fund, 2 cents to the ambulance fund. 8.2 cents for the general purpose school fund, and 2.8 cents for the education capital projects fund.”
A large part of the budget is allocated to the Rutherford County School System. According to Peay, “In the spring, we’ll be borrowing for a school in Christiana. That’s probably another $35 million there … If you put this off … you’ll pay more interest in the long run.”
As the county continues to grow, Peay said he believes that more schools will need to be added, which means more money will be needed to build the schools. Peay says that options are limited in finding ways to pay for a school.
“Property tax and wheel tax are the two main ways we can do that,” Peay said.
The money from the proposed property tax increase would also help pay a 2.5 percent raise for teachers (about half of which will be funded by the state; the other half funded by local government) and a 5 percent raise for bus contractors, Peay said.
Rutherford County Communications Director James Evans said that “fewer people each year are choosing to go into teaching as a profession. School districts (across the state) are competing for those teachers.”
Rutherford County Schools expects upwards of 48,000 students this year, making it the fourth largest school district in Tennessee behind school districts in Knoxville, Nashville, and Memphis, Evans said.
For bus contractors, the raise is equally important, Evans said.
“Other area school districts over the past few years have reported an increased shortage of bus drivers,” Evans said. “We, fortunately, have not yet experienced (a shortage).”
So, what changes if the proposed property tax increase doesn’t pass? In short, Peay says not much — at least this year.
“We can use part of our rainy day funds … that we keep in case of catastrophic events,” Peay said.
But, Peay was adamant that the proposed tax increase needed to pass, or even more taxes could be in store for the county in the future.
“If you take money out of debt services and draw on your reserves, next year you will be mandated into a tax increase and could be in a worse situation.”
Even if money was taken out of debt services, Peay said he believes that money would still have to come from a source to pay for other basic needs. He added that although “we can take 2 cents out of our debt services for the ambulance services, we’ve still got to come up with 2.8 cents.” Peay said he would rather do the proposed tax increase “now and not do a larger increase later.”
Peay acknowledged concerns about higher property taxes, but said he hopes that Rutherford County property owners put their trust in his committee and the County Commission.