Hawkins commission rejects $40 wheel tax exemption for elderly

Jeff Bobo • Jan 22, 2018 at 5:30 PM


ROGERSVILLE — A resolution that would have given vehicle owners in Hawkins County 80 years of age and older an exemption from last year’s $40 wheel tax increase was defeated Monday by a vote of 9-11.

Some commissioners expressed an interest in bringing back the wheel tax exemption proposal when 2018-19 budget preparation begins in a few months.

The Hawkins County Commission voted in June to increase its wheel tax from $27 to $67, which would generate about $2.1 million in a fiscal year and offset the $2 million revenue deficit that the commission faced in the current budget.

The wheel tax increase went into effect as of Oct. 1, 2017. Including the state fee, it now costs $96 to tag a vehicle in Hawkins County.

As with the wheel tax increase votes last year, the exemption resolution would have required approval by two-thirds of the commission, or a minimum of 14 votes, in two consecutive months.       

What was the proposal?

In December, Commissioners Fred Castle and Michael Herrell sponsored a resolution that would have given anyone 70 years of age and older an exemption from the $40 wheel tax increase that was approved in June and implemented in October.

Following a lengthy debate, Castle agreed to pull the resolution with the understanding that he and the Budget Committee would work on a compromise in the January committee meeting.

That Budget Committee meeting was canceled due to weather, and Monday morning the commission considered a new resolution sponsored by Castle and Herrell to exempt everyone 80 years of age and older from the $40 increase.

Castle noted Monday that, according to the state, there are 1,705 drivers in Hawkins County who are 80 or older. Assuming each of those drivers owns an average of one vehicle, that amounts to a $68,200 revenue reduction for the county over the course of a fiscal year.

But there would only be three months left in the current fiscal year by the time the proposed exemption went into effect, which would cost the county about $17,050 in 2017-18 revenue.

What did the state say about the proposal?

Deputy Comptroller Jason Mumpower spoke to the commission from Nashville via Skype Monday morning prior to its vote on the resolution.

Mumpower said that if the commission approved the resolution— thus reducing its revenue — the county would have to re-submit the amended county budget to the comptroller's office for approval.

In such a case, Mumpower said the comptroller's officer would require the county commission to replace the lost revenue "penny for penny" by cutting recurring expenditures.

Concerns expressed about the resolution.

Herrell made a motion to amend the resolution to limit the exemption to one vehicle per household.

"Right now it's wide open," Herrell noted. "If they've got five cars they can get five discounts."

County Clerk Nancy Davis said that would be difficult to enforce, especially if, for example, there are five different drivers with five different vehicles living at the same address.

Commissioner Rick Brewer said it might be simpler to go by the owner's name instead of the address.

Brewer pointed out another flaw, however. His mother’s name is on his vehicle title. Brewer asked if he or other people in that situation would still be eligible for the exemption.

Herrell opted to withdraw his amendment and allow the resolution to go to a vote in its original form.

Will the idea of a wheel tax exemptions be considered in the next budget?

There's a good chance it will be considered.

Some commissioners who voiced opposition to the resolution said they weren't against the "spirit" or intent of the exemption, but they felt like the commission will be better prepared to consider a revenue reduction when it begins working on the 2018-19 fiscal year budget later this spring.

The property assessor's office is currently showing that Hawkins County will generate almost $400,000 more property tax revenue in 2018-19 due to growth.

On Monday, Commissioner John Metz said he believes the commission’s ultimate goal should be spurring more economic growth so that the county can begin "weaning" itself off last year's wheel tax increase — at least the $30 portion that doesn't affect emergency services.

Metz said that if the commission wants to provide an exemption on the wheel tax, it should be based on those living below the poverty level instead of by age. But, he said the $10 portion of last year's wheel tax increase that was earmarked to benefit emergency services should stay intact for everyone.

Metz added, "This isn't something we should jump into real quick just to do something for the sake of doing it. We're going to start collecting data that's going to be valuable to look for ways to start peeling that (wheel tax) back. ... My request would be to take all this data, put it together, and then come out with an actual comprehensive plan that will work. Put some thought into it. And that's something that does not have to be done until we put the budget together.

How did the vote go?

Yes: B.D. Cradic, Fred Castle, Greg Fletcher, Danny Alvis, Linda Kimbro, Mark Linkous, Charlie Newton, Rick Brewer and Michael Herrell.

No:  Dwight Carter, Syble Vauhgan-Trent, Eugene Christian, Jeff Barrett, Stacy Vaughan, Joe McLain, Jeff Barrett, John Metz, Nancy Barker, Darrell Gilliam, and Robert Palmer.

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