Johnson City Press Thursday, July 24, 2014

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Washington County money looking flat for 2015

June 11th, 2014 9:17 pm by Gary B. Gray

Washington County money looking flat for 2015

Washington County, much like Johnson City, is not likely to see either growth in tax revenues or an expansion of its tax base in fiscal 2015.

Though proposed departmental budgets are beginning to make appearances at the County Commission’s Budget Committee meetings, the words “tax increase” were not introduced at Wednesday’s meeting as a possible cure, at least not at this relatively early stage.

County Mayor Dan Eldridge revealed Wednesday that sales tax revenue projections are flat for the current year, though taxes on real and personal property — used as a prime measuring tool for growth — are likely to come in ahead of projections.

“As of May 5, we have seen projections from Assessor Scott Buckingham that real and personal property taxes will show a net growth of $21.6 million, which grows our revenues by more than $400,000. The schools get nearly half. The rest goes to debt service, the highway department and other funds.”

Speaking of schools, Washington County Director of Schools Ron Dykes was on hand Wednesday with an initial estimated 2015 budget. State funding is dropping more than $500,000 and federal funding and bond proceeds are set to fall by about $1 million. The budget also reveals jumps in personnel, administrative and instructional costs.

Estimated revenues for fiscal 2015 are $60,562,637, but expenses have come in at $64,345,932, meaning the school system faces a nearly $3.8 million shortfall — a financial conundrum that was not broached Wednesday.

Eldridge politely asked if Dykes could meet with the committee another time, citing the expanse of the schools’ budget and the time that will be needed to give it proper attention.

Meanwhile, Eldridge pointed out that while the tax base seems to have added girth, the county will only grow its tax base by .05 percent to 1 percent this year when all is said and done.

“We should be able to know at the end of the month whether the net assessment is a gain or a loss,” Eldridge said. “That’s when he’ll be able to provide us the information from Nashville.

To get a sniff of forward motion is a positive sign for any local government these days. But there is more news on the financial front, and it’s not good.

“The bad news is inflation is running at between 1.5 and 2 percent, and the bottom line is our revenue is not growing,” Eldridge said. “This is the fourth year in a row we’ve talked about revenues not growing. If we’re looking at three-quarters of a percent growth in our tax base a year, our usable net revenue will continue to decline.”

Eldridge said he felt the national economy was beginning to come out of its slumber, though ever so slowly. He also said investors are holding on to what they have during this time, and a lack of investment in the county means this is not the time to increase county services.

What does this mean?

It means not only that the county encourages investment; it desperately needs it. Just ask Johnson City officials, who are considering a property tax rate increase to, in part, do just that.

Ethan Flynn, a committee member and Johnson City resident had this to say: “Washington County has raised property taxes three times in the past eight years. The city is saying it hasn’t raised property tax rates in 12 years. But when the county rate went up — mainly to pay for new and renovated school facilities — property taxes went up for Johnson City residents living inside the county. Both school systems benefitted, but Johnson City property owners’ taxes went up.”

Like Gary B. Gray on Facebook at www.facebook.com/pages/Gary-B-Gray. Follow him on Twitter @ggrayjcpress.

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