Sullivan County gives thumbs-up to tax increment financing for ethanol plant

J. H. Osborne • Nov 16, 2009 at 12:00 AM

BLOUNTVILLE — Tax increment financing (TIF) from Sullivan County is a go for an ethanol-from-trash plant under development at the old Raytheon plant in Bristol.

The Sullivan County Commission agreed Monday to grant up to five years of TIF for the Reclaimed Resources Inc. project.

Information presented to commissioners earlier this month estimated the TIF total — for both county and city real and personal property tax revenues — at between $4 million and $4.5 million.

Investors in the business, headed by area businessman Ted Cox, will pump an estimated $157 million into the project, which will bring more than 100 jobs to the local economy within the first two years of operation, said Richard Venable.

He’s chief executive officer of NETWORKS – Sullivan Partnership, the joint economic development effort of Sullivan County and its cities.

According to information presented to commissioners, Reclaimed Resources will take solid waste otherwise destined for landfills and process it into ethanol and other useable products — and produce no pollution.

Earlier this month, Venable described it as one of the most exciting things to happen in Sullivan County since George Eastman set up shop in Kingsport.

On Monday, County Commissioner Bart Long said it’s the best thing to come along since Bristol Motor Speedway.

Under TIF, the increase in property tax revenues that results from redevelopment of a property is earmarked to help fund that redevelopment.

The business pays the property tax, but the difference between the old tax bill and the new tax bill is then paid by the county — for a predetermined period of time — to a redevelopment fund.

Due to the inclusion of personal property in this project — not a factor in more typical retail-based TIF projects — the localities would see some increase in tax revenues during the TIF period.

Also on Monday, the commission approved switching carriers — from Blue Cross Blue Shield to United Healthcare — for county employee health insurance as of Jan. 1.

The change will mean a savings of more than $300,000 for the county — and county taxpayers — for the 2010 calendar year, Accounts and Budgets Director Larry Bailey said Friday.

United Healthcare offered another rate proposal that makes vision coverage voluntary, completely eliminates a “platinum” option employees have been able to enroll in for a higher premium out of their own pockets, and some increased co-pays.

A big change — and potentially a big new cost for some employees — is prescription medications Nexium and Prevacid are not covered by the United Healthcare plans endorsed by the Insurance Committee.

A United Healthcare representative who spoke to commissioners Monday said the company’s coverage offers “equivalents” to those drugs.

Comments from commissioners prior to the vote to switch carriers indicated county employees might not pay any potential increase in premium costs for the 2010 calendar year.

The resolution as presented stated the projected rate increase at $121,823 for the county’s portion of the premiums and $17,882 for the share of premiums paid by covered employees. The county foots the bill for 88.2 percent of employee health insurance premiums, while the employees pay 12.8 percent.

Elsewhere, the resolution calls for using $69,835 from the county’s fund balances to pay for the increased premium costs for the six months of 2010 included in the county’s current budget cycle.

County Commissioner Wayne McConnell asked to amend the resolution to make it clear the county would pick up at least half of whatever increased premiums employees will have to pay under the new contract — a move seconded by Commissioner O.W. Ferguson.

Commissioner Eddie Williams countered by asking the commission to just pass the resolution and take another look at the issue after Bailey takes a look at the numbers again after the enrollment period winds down.

Williams said it could turn out there is not really an increase in premiums at all.

McConnell immediately withdrew his amendment, saying he’d certainly go along with Williams’ offer for employees to see no increase.

The debate over insurance dominated the commission’s morning business, with comments at times more lively than at a typical commission meeting.

Multiple commissioners complained that they should have been given more notice of the proposed change and more time to understand the differences between old and new coverage and rates — and time to discuss those things with employees.

“We need to find a better way to do this,” Long said, later adding that insurance is “a racket” and “insurance companies are like vultures — they will take as much meat as you let them get.”

McConnell said he didn’t like the way he and others were talked to by commissioners who serve on the commission’s Insurance Committee.

“You come in here and say we don’t know what the hell we’re talking about,” McConnell said.

Long, McConnell and Commissioner Mark Vance voted against switching to United Healthcare.

In other business Monday, the commission:

• Rejected a proposal to shift the commission’s monthly meeting from morning (9 a.m.) to evening (5:30 p.m.)

• Had first reading of a resolution to sell the former Rock Springs Elementary School to the city of Kingsport for $1.

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