Johnson City commissioners reluctantly agree not to sue over $12.5 million Jonesborough school deal

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JOHNSON CITY, Tenn. (WJHL) — Johnson City’s Board of Commissioners reluctantly agreed Thursday night to accept the terms of a deal that will allow for the construction of a new school in Jonesborough.

The agreement means the city won’t sue the county over a unique funding deal between Jonesborough and Washington County that effectively prevented the city from getting millions of dollars for schools.

Under the terms of the plan, Jonesborough will borrow about $33 million to build a new K–8 school and athletic complex. The town would lease the school to Washington County with an option to purchase.

Usually, counties borrow money to build schools.

The unusual funding arrangement skirts a state law that requires counties to share a proportionately short amount of money borrowed for education with the city governments that exist within its borders. That’s because city residents pay county taxes.

When the arrangement was first introduced last year, some Johnson City leaders threatened possible legal action.

In hopes of avoiding a lawsuit, Johnson City City Manager Pete Peterson and Washington County Mayor Joe Grandy brokered a settlement that calls for Johnson City to get $12.5 million dollars from Washington County for school construction spread out in $500,000 increments over 25 years.

After months of negotiations and consultation with state legal and government officials, Johnson City commissioners were told Thursday night that a legal challenge likely would end in failure, and it created the risk of the city possibly getting no money at all.

“The only people that would be hurt in an extended court battle would be children of the county and children of the city,” said Commissioner Larry Calhoun during the virtual meeting. “It’s really my hope that this relationship between the city and the county would be such that we never find ourselves in this situation again.”

The city commission vote was unanimous. Commissioners learned money from the Jonesborough deal would go toward building a new Town Acres Elementary School and additions at three other schools.

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