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Kingsport approves budget with no property tax hike

Matthew Lane • Jun 5, 2018 at 10:00 PM

KINGSPORT – The Board of Mayor and Aldermen made the first of two votes Tuesday night to approve the fiscal year 2019 budget. A second vote is scheduled to take place in two weeks and the new budget goes into effect July 1.

This year’s budget process has been somewhat frustrating for the members of the BMA and a little contentious between Kingsport and Sullivan County. The main sticking point has been a $644,000 gap in operating funds for the school system, a gap caused when Sullivan County shifted around the tax rates of several county funds last year to balance its budget.

Mayor John Clark, Alderwoman Jennifer Adler and Alderwoman Betsy Cooper supported a property tax increase to balance the budget, though the remaining four members of the BMA were not on board with that idea.

“I'm a no vote for this budget. I don't believe it's in the best interests of the citizens,” Clark said. “We're stuck in the mindset that being the lowest cost of living city (in the Tri-Cities) is getting us something. That's not achieving us anything and I'd argue that it's hurting us.”

For the first time in several years the city is cutting services and One Kingsport investments, Clark added.

“That drove momentum and was improving the quality of life for everyone,” Clark said, noting the property tax increase would be about four cents a day for the typical taxpayer. “While we're here cutting services and investments, (Bristol and Johnson City) are charging more and investing more in quality of life improvements. The net result is they're winning customers.”

Vice  Mayor Mike McIntire said the BMA has a fiduciary responsibility to the citizens, adding the city would likely end the fiscal year with a surplus.

“The reality is the last four or five years we've ended the year with a seven-figure surplus. I think we'll finish this year with a good amount of money left over,” McIntire said. “We wouldn't be doing our job if we raise taxes and ended up with $1.5 million left over.”

Here’s a quick overview of the budget and the cuts city leaders made:

BUDGET OVERVIEW

- $81.4 million general fund budget

- $251 million total budget (all funds including schools and utilities)

- No property tax increase

- No new employees and no reduction of current employees

- Includes step increases for existing employees

- Funds Riverbend Park, Inventor Center, Bays Mountain Park improvements

- Keeps sustainable paving plan intact

BUDGET CUTS

- Eliminated $8.2 million in planned borrowing

- Amounts to $339,722 in debt service

- Cut 20 percent from special programs ($98,400)

- Cut $245,000 in One Kingsport funds

WATER & SEWER

- Water budget of $14.7 million and includes $4.9 million of capital projects

- A 3 percent increase on the water rate for inside city customers

- Average monthly water bill (inside city) - $13.37

- Sewer budget of $15.4 million and includes $2.56 million of capital projects

- A 3 percent increase for all sewer service customers

- Average monthly sewer bill (inside city) - $28.44

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