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Would you vote to raise sales tax?

September 24th, 2011 11:55 pm by Gary B. Gray

Will a one-quarter cent local sales tax increase fly in today’s severely grounded economic atmosphere?
Revenue generated from a successful campaign by the Johnson City and Washington County school systems to increase the tax would be used to pay for needs that very few would deny are genuine.
Ultimately, local voters would make the call if this request manages to find its way onto the March ballot. But a serious hurdle is looming, and it does not require voting booths.
The Johnson City Commission likely will soon have in its hands a resolution already approved by the city’s Board of Education. Commissioners have had a copy of the resolution for some time, and the issue by this time is pretty well understood. But the resolution, and the pleading of their case, may have come to the commissioners’ attention sooner if board members did not have to wait for the county to finish raking through its budget puzzle so the two boards can unify the push.
BOE Chairwoman Kathy Hall said both systems are facing increased costs and the possibility of cutting both staff and programs. Hall said Johnson City’s system is “sinking” and something must be done to make sure needed programs can be maintained to keep the level of quality education high. If not, the school system could be facing major cuts that could include arts and after-school programs.
Enter city commissioners.
“I won’t be supporting it,” said Commissioner Clayton Stout. “The last thing anybody needs around here is more taxes. I think it’s D.O.A. if it gets on the ballot. How do you justify this? Schools already are around 50 percent of our budget, and both boards should have thought about this before giving their superintendents a raise.”
Johnson City Schools’ 2011-12 budget includes a hike in Superintendent of Schools Richard Bales’ salary, which rose from $125,613 to $146,202. That’s about $20,000 more than City Manager Pete Peterson’s annual salary.
Currently, the local sales tax rate is 9.5 percent. The state keeps 7 percent and sends 50 percent of the total back to schools where the amount is split roughly 55-45 percent between Washington County and Johnson City schools respectively. The increase would bring the local rate to 9.75 percent, the highest allowed by state law.
Commissioner Ralph Van Brocklin fully supports the increase. The former BOE member said he wants to see the school system remain one of the best in the state and additional revenue is needed to make that happen.
“It is my hope that our voting public recognizes that need,” he said. “Whether the City Commission opts to adopt the wording in the resolution which was forwarded to us by the BOE will be open to some debate. Commissioners understand the need for operational dollars, but some have indicated they would like to see the referendum worded in a manner which dedicates a portion of the funds to maintenance and capital projects,” he added.
As it stands, all revenues from the increase would, at the discretion of board members, be used for operational costs.
“Communication is vital here,” said Commissioner Jane Myron. “We’ve got some questions. For example, have they exhausted every option? And, have you asked yourselves about possible options. “We’ve received some information from (City Manager) Pete Peterson that helps explain state funding for schools and some other aspects of school funding, and I’ve been looking at that. But I need more information before knowing whether I would or would not vote to put this on the ballot.”
A major point of discussion between the two school boards has been the possibility the state could act first and that they need to act locally before that happens. Should the state increase its sales tax rate, the additional revenues would go into state and not local coffers.
Vice Mayor Phil Carriger said he favors putting the proposed tax increase on the ballot, and keeping the new revenues here are part of why he wants to go forward.
“I think sooner or later the state’s going to take it,” he said. “Taxpayers need to be the ones who decide, but I think using it for education is the right thing to do.”
Mayor Jeff Banyas was not immediately available for comment.
At their June 6 meeting, the city Board of Education voted to increase raises this year for certified and classified employees from the state-mandated 1.6 percent to 2 percent raise.
Vice Chairman Richard Manahan stated at the meeting that “all teachers should get a 10 percent raise.”
After some discussion, the board voted unanimously to use money from its fund balance to pay for the additional $163,000 needed to reach 2 percent. Overall, the pay increase will cost about $815,800.
The current average salary for a Johnson City Schools tenured teacher is $52,044, and the estimated cumulative earnings for teachers over a 30-year career is about $1.6 million, according to the Tennessee Education Association.
While Tennessee teacher salaries averaged $46,290 in FY 2009-10 — below the national average — Tennessee’s cost of living was the lowest in the nation during the third quarter of 2010. Also, teachers in Tennessee earned nearly $9,000 more than the average wage for all occupations in the state, according to the Tennessee Department of Labor and Workforce Development.
Meanwhile, the outlook for the nation’s 14,000 school districts is bleak, not just for the near future, but for a half decade or more, according to a report by the American Enterprise Institute for Public Policy Research. This calls for a new mind-set among educators and an unfamiliar, sometimes-uncomfortable commitment to productivity and cost-effectiveness, the report adds.
Key points forming this opinion include the fact administrators can no longer rely on steadily increasing budgets; property-tax revenues are falling, thanks to the housing bubble burst; most stimulus funds will dry up after this school year; and state budgets are increasingly pinched by Medicaid and public-pension obligations.
Still, according to the Department of Education’s own data, school district staff actually increased by 2.3 percent nationally over the course of the “Great Recession.” And, while state government employment has declined 1.9 percent since December 2007, state education jobs are up 2.1 percent. Private-sector jobs fell 6.8 percent in that time; local education employment, on the other hand, declined by just 0.9 percent (

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