County budgeting process begins: Capital projects the subject of Budget Committee workshop

Dan Eldridge

Dan Eldridge

By Scott Robertson

Less than a year ago, the Washington County Commission voted down a proposed tax increase which would have funded construction of a new K-8 school (to replace the existing Boones Creek Elementary and Middle schools) and renovations to the existing Jonesborough schools. Since that time those schools have only gotten older. So at the first meeting of the 2016 Budget Committee, a workshop last Wednesday, there was little appetite for letting the schools’ needs go unaddressed again.

Finance and Budget Director Mitch Meredith passed out two sets of figures. The first showed projections of capital project needs for the next ten years should the county fund the construction of the new Boones Creek school. That set of figures projected an annual need of roughly $9.5 million. Meredith then handed out a second set of figures showing what would be needed to fund not only construction of the Boones Creek school, but also a new Jonesborough school as well. That set of figures called for around $10.5 annually.

Said committee Chair Joe Grandy, “What we’re looking at is what we think it’s going to cost on an annual, recurring basis to fund whatever the needs are.  The intent of this effort is to provide the platform for a revenue source that will provide whatever is needed down the road. So we’re looking at some known stuff and trying to figure out what we’re going to need.”

Both sets of figures took into account the needs for several specific projects over the next decade. Among those were a new roof for the George Jaynes Detention Center as well as paving, sealing and painting the justice center parking lot; exterior, roof and parking lot work for the county courthouse; repaving the Jonesborough Library parking lot; paying for a new communications system for public safety responders; and a roof and paving for the county health department.

“The intent of this from the beginning has been to create a stream of recurring revenue that is available to meet what we believe will be a fairly average amount of capital expenditures and investments in a typical year going forward,” said County Mayor Dan Eldridge. “There is not, and has never been, an intent to project year-to-year-to-year what the specific needs are going to be. That’s impossible. What is possible is to allow for funding for a typical year.

Joe Grandy

Joe Grandy

“You know, five years from now we may have a year that requires more funding,” Eldridge said by way of example. “Seven years from now we may have a year that requires less funding. But having that stream of revenue established on a regular basis, will allow us to plan better. It will allow us to say something like, ‘we see that we’re going to have to replace a roof that we didn’t anticipate replacing in the next two years – let’s adjust our spending downward this year so we can cover the cost of it the following year.’ This creates not just a financing tool, but a management tool.”

Should the commission decide to fund the new school building or buildings, it will have several choices to make. Should the commission fund only the Boones Creek construction and renovation for Jonesborough schools, or should the county bite the bullet and pay for construction of two new schools? Should the capital projects be funded with a property tax increase, a bond issue, or some combination of the two?

To fund the school construction with debt, Eldridge said, Boones Creek and Jonesborough would require $60 million of borrowing each. With the county already at $150 million of its $290 million debt limit, that would bring the county to within $20 million of its limit, leaving the county virtually tapped out, with replacement of schools in Sulphur Springs and Fall Branch still on the horizon.

To fund the schools purely with a property tax increase, Eldridge said, both schools together would require a 28 cent increase. That would equate to around $70 per year on a house valued at $100,000.

The committee took no action, and has yet to consider the operating budget for the coming year. The meeting was the first as chair for Grandy, who was appointed to that seat by Eldridge. Grandy thanked three commissioners who were not part of the committee for attending, and said he hoped to see attendance rise for budget meetings as the process moves along.


City/County funding plan fails to reach state legislature

By Scott Robertson

A plan proposed by Washington County Mayor Dan Eldridge and Johnson City City Manager Pete Peterson to change the way counties and municipalities fund school construction will not reach the Tennessee General Assembly for consideration this session. Eldridge told the Budget Committee last Wednesday that earlier in the day he had let the legislators who had been holding captions (a means for bringing an item in front of the legislature) to release them. “Unfortunately a couple of the municipalities had some unrealistic expectations and we were unable to move forward at this time,”Eldridge said. Asked if  the plan could be resurrected, Eldridge said, “not this year.”

Eldridge and Peterson met on Jan. 27 to discuss several matters and ended up putting together the plan. It would have closed a loophole in state law which allows counties to make some capital project purchases for schools without having to share dollars with the city school systems while at the same time keeping counties from having to make a single, large, up-front payment in instances where they do have to share.

On Feb. 2, the two met with leaders from McMinn, Roane and Sullivan counties, and the municipalities in those counties, as well as leaders from the Blount County cities of Alcoa and Maryville. Blount County leaders did not take part in the talks. “The Alcoa and Maryville folks just had some unrealistic ideas,” Eldridge said, adding that without a significant shift in their outlook, the chances of reviving the plan next year appear slim.


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