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Property tax increases loom in Erwin, Unicoi County

Sue Guinn Legg • Aug 24, 2019 at 11:35 PM

ERWIN — Erwin residents may be in for a double shot of property tax increases Monday, as both the town’s Board of Mayor and Aldermen and the Unicoi County Commission meet for final votes on underfunded budget proposals for the new fiscal year.

For landowners inside the Erwin town limits, city property taxes appear to be in for a 40-cent hike needed to meet expenses set out in a proposed 2019-20 budget some $650,000 out of kilter.

The mayor and aldermen unanimously approved the budget on first reading at their last meeting on Aug. 12 despite the objections of several Erwin residents who told the board the increase will place an undue burden on landowners, particularly those who are seniors with fixed incomes.

The board reviewed the budget again during a Wednesday work session in attempt to find expenditures that could be put off until next year, but ultimately decided such cuts would only be delaying the inevitable.

“We discussed whether we wanted to continue with the 40-cent increase or wait until next year (for) some of our budget items. We looked a the budget but didn’t see anywhere we could cut without raising taxes 40 cents next year,” Mayor Doris Hensley said on Friday.

“We decided to do it now and hope that next year there won’t be any increase, or if there is, it won’t be very significant.”

The budget $7.4 million town budget includes approximately $600,000 for Tennessee Department of Transportation road resurfacing, $108,000 in new debt service on $1 million borrowed last year for the purchase of a fire truck, an emergency response truck, two police cruisers, first responder turnout gear and public works equipment; and more than $500,000 in existing debt service on nearly $2 million in debt remaining on a comprehensive renovation of Erwin’s downtown business district.

The budget also includes approximately $400,000 in match funding for federal and state grants used for the pad-ready development of the former Morgan industrial site and a new extension of the Erwin Linear Trail. It also includes a 3 percent raise for town employees and funds one new full-time employee and two part-time employees who will become full-time.

If approved, the 40-cent tax increase will bring Erwin’s property tax rate up to $1.862 for every $100 of assessed property value. Monday’s board meeting will begin with a public hearing on the budget to start at 5:30 p.m. at Erwin Town Hall.

The County Commission will meet at 6 at the courthouse to approve a proposed 2019-20 budget some $337,000 out of balance and to set a property tax rate to meet that budget.

Short of a $337,000 dip into the county’s fund balance of just over $1 million or cuts to the budget that were voted down by a narrow 5-4 majority at the commission’s last meeting Aug. 6, the deficit will equate to an 11-cent increase in county tax rate.

Those voting against a proposal to eliminate the deficit by drawing $130,477 from the county’s general fund balance and eliminating expenditures including annual step raises for county employees and three new jailers for the sheriff’s department were Commission Chairman Loren Thomas, Commission Vice Chairman Jamie Harris and Commissioners John Mosley and Matthew Rice. Those voting in favor of the cuts were Commissioners Todd Wilcox, Marie Rice, Jason Harris and Glenn White.

A proposal to balance the budget with 6.5-cent property tax increase and an approximate $220,000 draw from the fund balance was withdrawn after Thomas said discussion of the tax rate was not on the commission’s Aug. 5 agenda and was therefore illegal.

Unicoi County’s tax rate is currently $2.6838 per $100 of assessed property value and the highest tax rate in the eight counties of Northeast Tennessee.

Monday’s commission meeting will also include a vote on a sublease agreement on a three-bay garage and two residential suites adjacent to the former Unicoi County Memorial Hospital for use as a new station for the county’s ambulance service.

Christian Care Center of Unicoi County, which leases the property from the UCMH board, has offered the month-to-month sublease to the county at a rate of $1 per month.

The commission will also consider a memorandum of understanding with the Unicoi County Board of Education for a $5.1 million bond issue to be used for the demolition and reconstruction of the count’s badly deteriorated high school football stadium and other capital improvements.

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