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VOL. 133 | NO. 67 | Tuesday, April 3, 2018

Lenoir: County Tax Decrease Was ‘Smoke and Mirrors’

By Bill Dries

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With the estimate last month of an $18 million to $25 million county budget surplus for the fiscal year that ends June 30, taxes are about to become an even bigger issue in the Republican primary for Shelby County mayor.

County chief administrative officer Harvey Kennedy last month announced the surplus in revenues which he attributed to better collections of county property taxes and fewer appeals of reappraisal values.

The surplus follows the reappraisal of taxable property by the Shelby County Assessor’s office in 2017 and the resetting of the county property tax rate to take into account that reappraisal.

Republican contender for Shelby County mayor David Lenoir says the projected county budget surplus shows last year’s resetting of the county tax rate amounted to a tax increase. (Daily News/Bill Dries)

By state law, after the reappraisal, which is every four years in Shelby County, the property tax rate is to be reset to create the same amount of revenue the previous county property tax rate generated.

The state also must approve the rate.

After considerable debate last July, the commission set a county property tax rate recertified by the state of $4.13 from the previous rate of $4.37. The commission then reduced that new rate by two cents for a tax rate of $4.11.

Shelby County Trustee David Lenoir, who is running in the Republican primary for county mayor, told a group of 30 supporters in Arlington last week that the recertified rate should have been even lower.

“Property values went up 13 percent and the tax rate only went down 5,” Lenoir said at the Thursday, March 29, gathering at Arlington Abbey. “The overwhelming majority of those taxpayers paid more in taxes this year. It was not a tax reduction. … We need to provide a dividend for the shareholders.”

Lenoir, who is endorsed by outgoing Shelby County Mayor Mark Luttrell in his bid to succeed Luttrell, first made the point after the commission set the new rate last July.

Shelby County commissioner Terry Roland, who pushed for the two-cent tax reduction after the resetting of the rate last year, is also running in the Republican primary. He said last week he intends to push for another tax reduction in light of the projected surplus.

While Lenoir describes the tax cut as “smoke and mirrors,” Roland counters that Lenoir in his role as Trustee has nothing to do with the setting of the tax rate and instead sends out tax bills and collects the taxes.

Lenoir refers to his office as “the county’s banker.” And while he doesn’t have a vote on setting the county tax rate, Lenoir’s numbers on county revenues were a critical part of a 2015 budget controversy when his numbers showed a $22 million budget surplus after the administration’s numbers showed a surplus of $6 million.

The $22 million budget surplus was confirmed after the commission had already set the budget for the new fiscal year and voted down a property tax reduction.

Roland and Lenoir, who are part of a three-way Republican primary for mayor with juvenile court clerk Joy Touliatos, agree that high taxes are a barrier to economic growth in Shelby County.

Roland says the county tax rate is fueling a move of Memphians to just outside the county borders.

Lenoir told supporters in Arlington last week that touting Memphis and the rest of the county as an affordable place to live misses a key point. While it does impress site consultants for corporations looking to move or build new somewhere, they also discover that the lowest property tax rate in the state is in Fayette County – a stone’s throw away.

“So while you may think that Memphis and Shelby County and this area is a great place to live, to work and to play, the reality is from a shareholder perspective you’ll save more money if you build that facility in Fayette as opposed to Shelby,” Lenoir said.

Touliatos has said the county’s quality of life plays a larger role in determining whether companies and workers come to Shelby County. Luttrell has expressed similar thoughts.

Lenoir, at the Arlington campaign gathering, also expressed doubts about the regional megasite state officials continue to try to find a tenant for in West Tennessee. Although it is called the Memphis Regional Megasite, it isn’t in Memphis or any of the counties bordering Memphis. It is in Haywood County.

“I think it’s going to have a potential tremendous negative impact on Shelby County because the workforce it will pull to the megasite – much of that will come from Shelby County,” he said. “I don’t know about you, but many people like to live close to where they work. There could be a big exodus, unfortunately, out of Shelby County.”

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 78 78 13,921
MORTGAGES 93 93 16,098
FORECLOSURE NOTICES 5 5 2,207
BUILDING PERMITS 242 242 28,995
BANKRUPTCIES 59 59 8,985
BUSINESS LICENSES 29 29 4,730
UTILITY CONNECTIONS 37 37 5,570
MARRIAGE LICENSES 37 37 3,019

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