ELIZABETHTON, Tenn. (WJHL) — Elizabethton’s property tax rate will increase by 5% if city commissioners approve a budget recommendation Thursday night, and much of that increase will go to increase funding for road paving.

If approved, the rate will go from $1.57 per $100 of assessed value to $1.65, which will increase the city’s revenues by about $240,000. That difference is slated for paving, which would increase that budget line item by more than 50% to $695,000.

The owner of a home assessed at $200,000 would see their annual city property tax bill increase $40, from $785 to $825, if the increase passes.

Commissioners also will consider a recommendation to increase the monthly base charges for water and for sewer by $1.50 each.

The proposed budget for the fiscal year that begins July 1 also shows several significant parks and recreation and cultural projects being funded from the city’s fund balance, which will end fiscal 2023 at $14.2 million. The budget proposal calls for using $3.8 million of that.

$1 million would be available to purchase the “Cowan Property,” a 1.5-acre lot adjacent to Covered Bridge Park. The sale is currently being negotiated.

Another $650,000 is set aside for work at the former Franklin Fitness Center near Sycamore Shoals State Park, and $390,000 is budgeted for improvements to the nearby Franklin Pool, the city’s public swimming pool.

Other significant fund balance purchases include:

  • A $500,000 contribution to the city schools’ capital fund.
  • $230,213 for rehabilitation of the Bonnie Kate Theatre, which counts as matching funds for a $500,000 grant from the Appalachian Regional Commission.
  • $218,283 for three new police patrol vehicles.
  • $150,000 for a computer system conversion.

The water-sewer rate increases would bring the base water rate from $18.95 a month to $20.45 and the base sewer rate from $18.32 to $19.82. Regional (non-city) water rates will increase $1.50 from their current $25.84 and rates for water connections larger than 3/4-inch will rise by proportionally higher amounts.

The proposed rate schedule also factors in an identical increase for fiscal 2025.

City staff cited material and labor cost inflation for the water rate proposal.

“The City is in the service delivery business. We put those services at risk if we can’t hire and retain staff or buy the materials and equipment needed to do the job,” said City Manager Daniel Estes.

The commission holds the first of three readings on the budget Thursday at 6 p.m.