As we noted in this space back in June, one issue left unresolved in the first half of the 108th Tennessee General Assembly was a bill to give state tax breaks to victims of the 2012 flood in Washington County. State Sen. Rusty Crowe, R-Johnson City, had sponsored a bill to provide state sales tax refunds to Dry Creek residents who are rebuilding or repairing homes damaged in the heavy flooding.
That bill, however, was flagged by officials with the state Department of Revenue, who feared the measure would set a precedent for other such natural disasters that do not qualify for funding from the Federal Emergency Management Agency. Because the dollar amount of the damages sustained by Dry Creek residents didn’t meet the threshold for federal relief, current policy stipulates those residents don’t qualify for state tax refunds.
It is the federal disaster recognition that triggers such state relief. That policy needs to be reviewed, particularly in light of the extreme weather we’ve experienced lately in Tennessee.
While the loss of homeowners in Dry Creek might seem miniscule in comparison to the multimillion-dollar damages seen in the 2010 Nashville flood, it was nonetheless devastating to that small community. Families there are still trying to recover.
It doesn’t seem too much to ask that people in such situations be given a little tax relief from the state as they struggle to rebuild their homes. We encourage state officials to establish a contingency fund for handling relief requests such as that for the Dry Creek community, and to develop a policy for sales tax refunds that applies fairly to all cities, towns and communities in Tennessee.