Red Bank rejects FY2022 budget that included large tax increase

·4 min read

Jun. 5—Curbside recycling pickup and library cards are among the initiatives from two newly elected Red Bank city commissioners that failed last week, when other commissioners declined to approve the city budget that included them.

Mayor Hollie Berry and Vice Mayor Stefanie Dalton also proposed raising the base pay of all city employees to $15 per hour, constructing a pavilion at the White Oak Dog Park and providing 50 Chattanooga Public Library cards for residents to use.

The amenities would have added $708,890 to the $7 million budget for the fiscal year that will start July 1, but only Berry and Dalton voted for the budget, so it didn't pass.

The proposed budget did not include a tax rate increase, but commissioners did propose maintaining the city's current tax rate of $1.39 per $100,000 of a home's assessed value.

The Hamilton County Tax Assessor's Office has yet to supply the city with a certified tax rate, but Tax Assessor Marty Haynes told city officials the value of homes in Red Bank increased by an average of 40% during the four-year reappraisal cycle, based on preliminary assessments. So maintaining the current tax rate would effectively be a tax increase.

"That's a significant tax increase for citizens," Commissioner Ruth Jeno said, adding that based on the preliminary assessment of her home's property value — which increased by 49% — she would pay $600 more in city taxes under the city's current tax rate.

Commissioners voted to maintain their current tax rate until the certified rate is received, which they can choose to accept or reject and establish a different rate.

The failed budget also included a $3 monthly fee for curbside recycling for all taxpayers, which would have been in addition to the $16 per month sanitation fee they pay now.

Other expenses associated with the recycling program, such as $210,000 for a truck and the salary for its driver, were included in the failed budget as expenditures coming out of the general fund. Dalton said the city's sanitation fund contains about $900,000 in taxpayer funds collected through sanitation fees that could be used to cover those costs.

Expenditures in the proposed budget exceeded revenues by $708,890, which would come out of the city's fund balance of around $5 million, said interim City Manager John Alexander, the city's finance director.

"With all the unknowns we've got coming up — it's the end of a pandemic, we don't know if that's going to come back or how that's going to do — I'm just not comfortable with this much of a deficit," Jeno said during a budget session before the commission meeting.

The expenditures in question were additions to the original proposed budget, which was based on requests made by the city's department heads to address their needs, Jeno said.

Dalton said the budget presented Tuesday was prepared based on a consensus reached by commissioners during budget sessions held in May. Just before the vote, she said the budget being presented would not pass because Commissioner Ed LeCompte changed his mind.

After the meeting, LeCompte said he voted against accepting the budget due to the cost of the additions to the original budget.

He said he feels the city should increase the operating hours of its recycling center as opposed to adding curbside recycling. LeCompte also said he thinks the city should raise its base pay for employees by step increases rather than all at once.

City departments that would be affected by increasing the base pay for employees to $15 an hour are Public Works and Fire.

LeCompte and Commissioner Pete Phillips said the city does not have trouble finding or retaining employees paid at the current rates, and they are not aware of any employees who have requested increasing their base pay to $15 per hour.

Phillips said that when the commission reached a consensus on the budgeted items during previous budget sessions, he did not realize the difference between the proposed revenues and expenditures would be as much as about 10% of the city's $7 million budget.

The city must pass a budget on two readings by July 1, which means commissioners will need to call a special meeting to meet that requirement.

The commission is not holding another budget session before its next regularly scheduled meeting June 15, when Alexander will present a basic budget based on requests from department heads, he said.

Dalton said the main thing she will push to be included is the pay raises. She's willing to compromise in the form of step increases.

Jeno said she would agree to the pavilion at the White Oak dog park and flashing lights at crosswalks, but not the library cards.

The city, which does not have its own library, would have purchased 50 cards from the Chattanooga library for $50 apiece. Dalton said commissioners had previously agreed to subsidize half that cost so citizens who wanted a card would only have to pay $25. The cards would have been available on a first-come, first-served basis.

Contact Emily Crisman at ecrisman@timesfreepress.com or 423-757-6508.

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