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VOL. 133 | NO. 117 | Tuesday, June 12, 2018

Luttrell, Jones: County Budget Talks Center on Property Tax Allocation

By Bill Dries

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Shelby County government’s budget season turns on the county’s property tax rate. It’s not about decreasing the current $4.11 rate to $4.05, as proposed by Shelby County Mayor Mark Luttrell. It’s about how the $4.05 rate would be allocated among various county uses.

Shelby County Mayor Mark Luttrell says the tax rate he proposed and its allocation is “a solid proposal.”

“We know the (County) Commission is going to be really inundated with a number of requests for additional funding in some other critical areas,” Luttrell said on the WKNO-TV program “Behind the Headlines.”

Mark Luttrell

Luttrell proposed reducing the amount allocated among the county’s seven public school systems by 5 cents with the move to the $4.05 tax rate. And that has caused some concern among commissioners, especially with the Shelby County Schools budget proposal $7.5 million in the red.

“Keep in mind that each penny raises more money than it used to. So, we’re actually giving an increase in those areas,” Luttrell said, estimating that even with the 5-cent reduction to $1.94 allocated to schools, public education would still get $7.5 million more in revenue.

That almost covers the $7.9 million increase for education Luttrell proposed in his budget, bringing total county government funding of public education to $427 million – the lion’s share of that going to Shelby County Schools. The $7.5 million gap in SCS’ budget takes into account Luttrell’s proposed changes in education funding as well as the school system’s use of $49 million from its own reserve fund.

Eddie Jones

County commissioner and budget committee chairman Eddie Jones says there likely will be more debate to come around increasing the part of the new tax rate for public education.

“I’m seeing a lot of what they are doing,” Jones said of Shelby County Schools. “They are getting ready to close five schools and they are going to build two new schools.”

While Jones likes the direction the school system is going, Luttrell has his qualms about the process for funding schools under state law, which includes school systems having no taxing authority of their own but the local governments that fund them having no line-item control over school system budgets.

“The school system presents their budget and the County Commission approves that budget. But we really don’t have any control over the budget beyond that,” Luttrell said. “They can spend the money however they choose to spend it. … There’s very limited discretion we have when it comes to accountability and control.”

Luttrell also thinks Shelby County Schools still has progress to make.

“We are seeing our school enrollment decrease, yet the cost is significantly increasing,” he said. “And I look at the indicator scores that we get on the school system and it still indicates that we have some serious deficiencies in achievement.”

SCS officials have said the decline in enrollment from the last school year of Memphis City Schools through the one and only school year of the unified Shelby County public school district will settle soon – four years into the demerger of public education into seven districts in the county.

Jones points to the estimated $20 million windfall county government got from the current tax rate of $4.11 set after the 2017 countywide property reappraisal. The rate is being adjusted to account for that windfall created by an overestimate of appeals of the property values.

“A certain amount is already allocated for schools,” he said of the surplus as a whole.

“There probably would be somewhere close to anywhere from $8 million to $10 million – that’s not allocated, that’s not put in the budget,” Jones said. “That’s is what is being projected that we will have in a surplus.”

Luttrell called on the commission to approve his budget proposal as is – including the $427 million for schools – with the new county mayor elected in August considering additional school funding from the more specific revenue projections shortly after the mayor and new commission, which will have at least eight new members, take office Sept. 1.

“What we are suggesting is that to meet the needs of the school system that we go ahead and approve what we have submitted to the county commission,” he said. “And then revisit after we have a more definitive idea of what the revenue streams will be.”

The county traditionally has more precise revenue estimates in September.

On other topics, Luttrell said he wants to meet with Justice Department officials and Juvenile Court Judge Dan Michael to discuss a call by the coordinator of the settlement agreement between the court, the county and the Justice Department on conditions at Juvenile Court.

Paul Summers, the coordinator of the 2012 agreement, called last month in a report as part of the process for an end to Justice Department oversight of the court.

“I’m not going to take a position on that until we’ve had a chance to collaborate as a committee on that recommendation,” Luttrell said.

County commissioners including Jones approved a resolution in vocal opposition to a similar formal call for an end to Justice Department oversight Luttrell, Michael and Sheriff Bill Oldham made in 2017.

“I’m going to stand with what the Department of Justice has put on the table until we can see measurable results,” Jones said.

Meanwhile, Luttrell’s budget proposal includes $3 million in funding as “a start” toward planning for a Juvenile Assessment Center called for by Michael that would be a place to divert youth brought to the court without them being held in formal detention.

Luttrell referred to it as “our attempt to try to short-circuit their entry into the criminal justice system.”

PROPERTY SALES 107 331 6,877
MORTGAGES 60 239 4,368
BUILDING PERMITS 190 508 16,423
BANKRUPTCIES 22 136 3,532