The county’s Budget and Finance Committee has voted to put a local wheel tax referendum on the presidential primary ballot next year to give voters the chance to decide whether to continue the tax, which provides funds to pay off school construction bonds.
The $30 tax was established in 1991 to help fund Warren County High School and Hickory Creek Elementary. That tax will expire in June, 2012.
The measure still has to be approved by the full Warren County Commission to get on the ballot.
The wheel tax brings the price of registering a vehicle to $54 in Warren County, but according to officials, it’s still one of the lower wheel taxes in Tennessee in counties where a wheel tax is levied.
County Executive John Pelham, and a number of commissioners, feel this is not the time to drop the wheel tax since the county has recently invested over $16 million in new school construction with Dibrell School expansion and the new Morrison School project.
Budget and Finance Committee chairman Herschel Wells asked director of accounts Linda Hillis to explain the effect of dropping the wheel tax.
“The wheel tax generates roughly $1 million annually, which goes directly into our debt service fund to pay for school debt,” said Hillis. “In 2012, Hickory Creek and the high school will be paid off and the current wheel tax is tied directly into that bond issue. So it will expire when these bonds are paid off.”
Officials say it would take a property tax increase of around 17 cents to make up for the loss of the wheel tax, noting they feel it is not fair to shift the burden of school construction to property owners alone, considering the fact more people own cars than property.
“We’re obligated to the Morrison project, the Dibrell project and the Centertown project still,” said Hillis. “The Centertown project will pay off in 2014, but Dibrell won’t pay off until 2030, and Morrison pays off in 2027.”
Opponents of the wheel tax, including Commissioner Michael Martin, have stated they would circulate a petition to hold a referendum on the tax so the public could vote. In order to avoid the expense of a separate referendum, members of the Budget and Finance Committee opted to put the referendum on the presidential primary ballot which has been moved, via legislation passed recently, to the first Tuesday in March, rather than the first Tuesday in February, where it had been for several years.
After introducing the idea to committee members, Wells asked Martin, who has been vocally opposed to continuing the tax, if he had any comments.
“Get rid of the wheel tax,” Martin said.
“I understand that,” Wells replied. “But I think what the people want is a referendum.”
Martin disagreed.
“I don’t think they want that,” Martin said. “I think most people just want it to go. If you talk to most people they think the schools have already been paid for. You tell them 20 years and they just look at you.”
Wells pointed out the importance of the tax and that he feels the public deserves a choice between a property tax or wheel tax.
“This gives them an opportunity to vote,” Wells said.
Martin raised concerns about wheel tax collections, noting the county is short most years according to the number of cars registered in the county and also noting the fact some car owners simply register their cars in Grundy County.
But Wells reiterated that the public deserves a chance to choose.
“We’ve talked about this in Budget and Finance,” Wells said. “So is there a motion we take this before the full court as a referendum to be put on the ballot in March?”
Commissioner Ken Martin made the motion which was seconded by Commissioner Carl Bouldin. The motion passed 4-1, with Michael Martin the only dissenting vote.