Shelby County Commissioners vote Monday, Jan. 28, on disbanding the nearly 10-year-old Needs Assessment Committee that advised the commission on funding school construction and renovation projects across both public school systems.
The commission meets at 1:30 p.m. at the Vasco Smith Administration Building, 160 N. Main St.
The committee was created to give the commission an overview of school construction and renovation projects in both of the county’s public school systems. Its members included architects and construction contractors knowledgeable about such projects.
Shelby County government has been the dominant local funder of Memphis City Schools and Shelby County Schools. The money county government has provided for school construction in both school systems has been the major factor in the just more than $1 billion of bond indebtedness the county currently has.
But with the move to a merger of city and county schools in August, the committee has been inactive for the last year-and-a-half.
“I think it did a good job of focusing on real needs and encouraging the school boards to justify their needs,” said County Commission chairman Mike Ritz, who is proposing the disbanding of the group. “When you start asking people questions, priorities change.”
With the merger, there isn’t the need for a body that will look at school construction needs across the boundaries of the two school systems and prioritize the separate requests from two school systems.
“The circumstances now are completely different,” Ritz said. “We only have one school system.”
He added schools leaders have indicated the first budget proposal for the merged school district this spring will not include any school construction projects. The projects could resume in the second fiscal year of the merger and if the commission feels a need to bring the committee back it could reconstitute it.
Meanwhile, commissioners are awaiting a legal opinion from the county attorney’s office on whether a two-thirds, or nine-vote, majority is required to raise the county’s recertified tax rate by more than 10 percent to produce the same amount of revenue for county government.
The question has come up because of an expected drop in property values in the current Shelby County property reappraisal.
Ritz questioned whether nine votes is required since it is a recertified tax rate to produce the same amount of revenue.
“I think we are confusing a lot of people unless we know what it is,” he said of references to the recertified rate as a tax hike. “We have elected officials saying things that may or may not be true. But we need to know. It’s really important.”
Shelby County Mayor Mark Luttrell has said there probably will be a county property tax rate hike for the fiscal year that begins July 1 to provide additional funding for the consolidated school system and Memphis-Shelby County Juvenile Court reforms.
County Chief Administrative Officer Harvey Kennedy said the recertified rate, which the commission must approve, is a “baseline” for producing the same amount of revenue. State revenue officials then certify that tax rate.
The state law was established to prevent a local government from getting a “windfall” in revenue by leaving the tax rate the same when the local government is getting the benefit of a tax hike.
County government faces the reverse of that in the new fiscal year.
“They never envisioned this decline in property values,” Kennedy said. “They always set the anti-windfall. They didn’t talk about a reverse windfall. We’ve got a difficult situation.”
Commissioner Terry Roland said he considered a rise in the recertified tax rate as a tax hike.
“To me, if a person’s property value went down, then their taxes should go down is the way I look at it,” he said. “The answer is the government institutions should have to work on less.”
Commissioner Heidi Shafer said while the drop in revenue may be unprecedented, past commissions have generated revenue increases by keeping the certified rate the same despite the state law.
“We have taken advantage of the windfall by maintaining the same tax rate,” she said. “I think the commission has adjusted in the past and gotten the windfall. I know we are fighting for every dollar but if we’ve taken advantage of it in the past, we need to be aware of that.”
The committee discussion last week on the point came as Shelby County Trustee David Lenoir said his preliminary discussions with Shelby County Property Assessor Cheyenne Johnson indicate property values for assessment purposes could fall back to the values before the 2009 reappraisal.
“If that’s the case, then we’ll probably, based on my rough calculations, take another $22 million off the tax rolls,” Lenoir said, adding that the county has lost an additional $35 million in billing since the 2009 reappraisal through appeals by property owners.
“To say the least, we all have our work cut out for us,” Lenoir said.