Last time on tax increase

I thought I would address the recent Signal Mountain property tax increase one more time, primarily as concerns the rhetoric. The original referendum passed in 2004 allowed a property tax increase "up to" 35 cents to pay for the school bond. This tax would go away when the bond was paid off. This amount was calculated based on a 20 year loan payoff at the maximum interest rate of 6% (we purchased a "cap" on the interest rate). Since then interest rates have run something less than 1% and we have greatly accelerated the pay-off on the loan.

My proposal, which Bill Wallace and Dick Gee agreed with and advanced so capably was to avoid a tax increase by lowering the amount of the "school tax" to offset any general tax increase. Susan Robertson called this a "back door tax". Well, back door or front door, a tax is a tax. My proposal would have kept money in people's pockets at a time when the economy is in significant pain and that was the goal. Her "front door" approach takes money away now and leaves a higher overall tax rate in effect when the "school tax" is eliminated, so is really both a front door and a back door tax!

The Council majority stated that lowering the bond payments to the minimum would cost an extra $150,000. This amount would be spread over the next 10 years or so. With approximately 7500 citizens and just under 3000 households, this amounts to approximately $20 per person or $50 per household. That's not per month or per year or per decade, but total. So, we could have assessed every household a one time fee of $50 (rhetorically speaking) instead of increasing taxes by $150 annually for every $100,000 of assessed value of your house. Frankly that doesn't make economic sense to me nor sound like much of a savings.

Finally, there is the "moral and ethical" charge. One or two years ago, after the county reassessed all county property, we lowered our overall tax rate by 15% to compensate for a 15% increase in property values. At that time, we lowered the "school tax" from $.35 to $.30 to keep it from biting into general revenues and to avoid a tax increase. This was non-controversial and I don't remember any discussion about the "moral and ethical" consequences. I also don't remember any consideration or discussion of how much tax would be rescinded when the loan was paid off. If the "school tax" is lowered, that is how much will be rescinded. It was not an issue then, so I don't know why it is an issue now. On this, as on so many issues, the principles of the majority on the council seem to bend to fit whatever their latest whim is, be it taxes or land use or money for education, etc.

I hope that the voters who promoted Ms. Robertson for her anti-tax stand during the campaign (see http://www.chattanoogan.com/articles/article_186139.asp) will do a bit more research next time.