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VOL. 132 | NO. 103 | Wednesday, May 24, 2017

Shelby County’s Certified Property Tax Rate Set at $4.13

By Bill Dries

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Shelby County Commissioners set the certified county property tax rate at $4.13 Monday, May 22, a 24-cent drop from the current tax rate of $4.37.

The resolution approved reflects the state-approved estimate of a tax rate that will produce the same amount of revenue for county government as the current tax rate following the 2017 countywide property reappraisal.

The property tax accounts for approximately $784 million, or 64 percent of Shelby County Mayor Mark Luttrell’s $1.2 billion budget proposal.

By state law, the resetting of the tax rate to reflect the reappraisal cannot produce a windfall for county government in terms of revenue.

The new certified rate is not the final word on the tax rate. The commission will approve next month a new county property tax rate that could increase or decrease the tax rate beyond the new certified rate.


Commission budget committee chairman Steve Basar questioned why the certified rate didn’t drop to reflect the average residential property value increase of 13.5 percent seen in the reappraisal.

“If we’re saying that the average property value went up by greater than 10 percent, then I would think to keep things level, our tax rate should go down by a commiserate amount,” he said. “I’m looking for a tax rate more in line with what people are going to expect. It’s hard for me to rubber stamp that.”

But county chief administrative officer Harvey Kennedy and county finance director Wanda Richards said there are other factors in calculating the rate, including new development or growth and an allowance for appeals of reappraisal values.

“If we weren’t going to have appeals it would be $4,” Kennedy said of the certified rate. “But you are going to lose a lot of property value through the appeals process.”

Commissioner Terry Roland, who is running for Shelby County mayor in 2018, cast the only vote against the certified rate.


“It looks like when it works out, it always works out for government and not for the people,” he said. “If you are going by what the government says you always wind up on the bottom.”

Roland, other county commissioners and Shelby County Trustee David Lenoir, who is also running for county mayor, have called for a tax rollback once the certified rate is set. But Basar has said there don’t appear to be the seven votes needed for such a cut.

The $4.13 rate wasn’t the county administration’s first calculation. Based on the 2013 reappraisal, the administration’s first calculation was a new certified rate of around $4.06.

“What happened to 7 cents?” was the first reaction of commissioner David Reaves at Monday’s meeting. Reaves is among those who have called for a property tax cut.

State officials rejected that calculation citing the unusual nature of the 2013 reappraisal that reflected dropping property values from the low point of the worst economic downturn since the Great Depression. For the first time in memory, the county reappraisal in 2013 saw a drop in overall values that caused the certified rate to be adjusted up.

The county and other local governments across the state who built their estimates on the most recent reappraisal instead went back to the 2008 reappraisal and other reappraisals that reflected property values before the recession hit. Even though Shelby County’s reappraisal was in the year the recession hit – 2008 – it nevertheless reflected earlier property values before the drop.

While a slow economic recovery was evident when the 2013 reappraisal occurred, it still reflected the worst years of the downturn.

PROPERTY SALES 66 66 6,612
MORTGAGES 78 78 4,207
BUILDING PERMITS 158 158 16,073
BANKRUPTCIES 45 45 3,441