During a meeting on the night of Thursday, May 30, 2019, the Smith County Budget and Finance Committee unanimously voted to recommend a 59 cent property tax increase.
This decision follows weeks of meetings in which the committee deliberated the best option needed to pass a county budget for the upcoming fiscal year.
The proposed property tax increase will go before the full Smith County Commission for approval during the next meeting on Monday, June 24.
A simple majority vote is needed in order for the recommendation of the Budget and Finance Committee to pass. Twenty-three commissioners are currently seated, meaning that the proposal would pass with 12 affirmative votes.
A Public Hearing will be held prior to the Commission’s vote in order for the voice of the people to be heard concerning this issue. This hearing will take place on Thursday, June 20, 2019, at 6:00 p.m. at the Smith County Jail and Courts Facility.
During Thursday’s meeting, the Budget and Finance Committee also reviewed a resolution that would provide a 1% or 2% tax break for property owners who choose to pay their taxes several months before the late-February deadline.
The committee voted to also present a form of this resolution for approval by the County Commission during the June meeting.
The proposed property tax increase will mean that no large cuts are made to county department budgets.
Several department heads expressed that a 25% budget cut would be detrimental to their daily operations; officials reported that these cuts would likely mean laying off many employees, closing the county Fitness Center and Senior Center, shutting the doors of one of the county’s three ambulance stations, and even closing the county jail.
Ultimately, the Budget and Finance Committee views the proposed property tax increase as a short-term solution.
According to the committee’s projections, the property tax increase should allow the county to build a $2 million fund balance within the next two years.
In order to reach this number, the committee has also trimmed approximately $1 million from the existing budget.
Members of the Budget and Finance Committee also discussed long-term solutions, such as assessing a wheel tax and/or a sales tax, which could allow the property tax rate to drop in the future.
The possibility of an occupancy tax for hotels, motels, and campgrounds was also discussed.
At the end of the meeting, county leaders expressed a commitment to transparency and a desire to pursue a solution that will fix the county’s financial problems.
You can read Smith County Insider’s previous coverage of the county’s budget meetings here.
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So… What would this 59 cent proposed tax rate increase actually cost citizens?
The formula for calculating property tax is as follows:
Assessed Property Value x .25 x Tax Rate
For example, if a person in Smith County owns property at an assessed value of $150,000, with the current property tax rate at 2.14, that person would pay $802.50 in property tax.
[150,000 x .25 x .0214 = $802.50]
The proposed increase would raise the property tax rate to 2.73. To put this in context, the person who owns $150,000 of property would now pay $1023.75, which amounts to an additional $221.25.
[150,000 x .25 x .0273 = $1023.75 = an additional $221.25]
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