Improvements to Loudon schools in limbo
County must now find way to fund projects after sales tax
By Hugh G. Willett, knoxnews.com
Voters in Loudon County earlier this week soundly rejected a half-cent
sales tax increase, leaving the county commission few options except
property tax increases to generate the more than $100 million requested
by the school board for capital improvements.
Depending on who you ask, the rejection of the sales tax initiative by a
5,521-3,631 vote shows that residents either did not want to see an
increase in sales taxes and wanted to pay higher property taxes instead
or that voters were rejecting the idea of any tax increase for the
"The voters have spoken," County Commissioner Don Miller said. "They
didn't want to increase the sales tax, and they may not want to increase
property taxes either."
Miller said the commission has been struggling with the task of
generating the money requested by the board of education for capital
improvements. It's a challenge that is almost out of the county's means,
Early projections suggest property taxes might double over the next five
Generating the money requested by the board of education will require an
increase in the property tax rate from $1.84 per $100 assessed value to
$3.60 over the next five years, Miller said.
"I'm not sure that's something property owners will accept," he added.
Miller hopes the school board will come back to commission with more
reasonable requests for the next five years.
The most recent funding proposal requests a 7 percent increase per year
for the next five years, he said. "That's way more than inflation."
Some county activists have pointed to the rejection of the sales tax
increase, not as a green light for a property tax increase but more as a
warning sign of a possible taxpayer revolt.
"Even after being threatened with a huge property tax increase, the
voters rejected the sales tax increase," said former County Commissioner
"If the voters don't want a half-cent increase in sales tax you can bet
the farm they don't want a 20- or 30-cent increase in their property
The rejection of the sales tax initiative puts the ball in the county
commission's court, according to schools Superintendant Edward Headlee.
"It adds more weight to the commission's decisions," he said.
There is also a theory that many Loudon County voters did not believe
that the increase in sales tax was going directly to the schools.
The sales tax initiative was the victim of bad publicity and rumors,
"I'm not surprised it didn't pass," he said. "There were a lot of signs
posted around the county against it, and I don't think there was much
positive said about it."
Rumors had circulated in the press, in discussions at school board
meetings and on county activist Web sites suggesting that the wording of
the sales tax initiative indicated the increased revenue generated would
not really go to help the schools, but would allow the county to use the
money for other purposes.
"Some people believed the money wouldn't have been used for the
schools," Headlee said.
The board of education is working with the county commission to revise
budget projections and the subject of funding options will be discussed
at a school board retreat in Gatlinburg this weekend, Headlee said.
The school board is also looking to the state for additional funding.
There has been discussion at the state level about using excess lottery
funds for school capital improvements, he said.
State and federal funding increases are unlikely to make a big impact on
the situation, commissioner Miller predicted.