ERWIN — With Unicoi County facing its largest property tax increase in recent memory, the County Commission may look to the county’s citizens to vote on whether they would like to see the implementation of a wheel tax to help fund county services.
On Monday, the commission will meet in a called session to consider a resolution that, if approved, would see the issue of the wheel tax placed on the November general election ballot.
If the commission votes to have a wheel tax referendum placed on the ballot and it passes, the tax would take effect in the 2013-14 fiscal year. Should the commission opt to proceed with the referendum resolution, the amount of the wheel tax also will be a topic of discussion at Monday’s meeting.
“I think their proposal is $25 (per vehicle) is the general feel I get for it,” County Mayor Greg Lynch said.
Last year, there were a little more than 20,000 vehicles registered in the county, and a wheel tax on each would generate more than $500,000.
Lynch said Wednesday the county is facing a property tax increase of a little more than 20 cents. Several non-recurring expenses have played into this, Lynch said, including approximately $130,000 the county had to pay to settle the 911 overtime lawsuit filed earlier this year, $28,000 needed by the Unicoi County Election Commission office to cover extra elections occurring om 2012-13 fiscal year, $77,000 for school resource officers and $10,000 for each trial, including those of former sheriff Kent Harris, that may take place during the fiscal year.
The county also saw increases in workers’ compensation expenses, county employee health insurance costs and county building property insurance costs. Lynch said revenues were over-estimated in the 2011-12 fiscal year budget, which accounts for around $200,000.
While Lynch said there are things that could help the property tax rate next year, such as new home construction and construction at some county industries, he admits this has been a difficult year.
“This is just a year where everything sort of happened at one time,” Lynch said. “It’s not extravagance on anybody’s part.”
One penny on the county’s property tax rate is equal to roughly $30,000. Lynch said around 4 cents of the proposed rate increase would go toward debt service for the construction of the new Unicoi County Middle School, and 6 cents would go to build up the county’s general fund.
Lynch said the referendum would allow commissioners to gauge the “pulse” of the citizens on whether they want to see the burden to fund county services continue to be placed on property owners, but said the possibility of a wheel tax has been met with resistance when discussed by county officials in the past. County Commissioner and Finance Committee Chairman Loren Thomas previously said he feels a wheel tax would alleviate some of the burden from county property owners.
“All the services that our citizens enjoy are currently paid for mainly by the property tax,” Thomas said previously. “Property tax is what can go up or down each year. The wheel tax basically makes more people pay because there’s a lot of people who don’t own property, so it makes more people pay because there’s more people that have vehicles than there are land owners. So it makes more people pay a smaller amount than just the property owners pay the full amount.”
However, not all commissioners have favored the implementation of a wheel tax. Commissioner Mickey Hatcher previously said his is not in favor of a new and regressive tax and feels the county’s poorer residents would be taxed at a higher rate with through a wheel tax.
Over the past month, the County Commission’s Finance Committee has been meeting to prepare the county’s 2012-13 fiscal year budget. The commission will meet in a called session at 6 tonight to present the proposed budget and consider approval of its first reading.
“I think the county commissioners have done what they could in cutting services without having a negative impact on the citizens of the county,” Lynch said.
If approved, the second and final reading of the budget would be considered at the commission’s regular meeting on Sept. 24. Lynch said the commission would prefer to have the budget approved and in to the state by Oct. 1 to avoid loss of BEP funding for the school system and to give the county’s trustee ample time to get tax notices out.