JONESBOROUGH, Tenn. (WJHL) — Jonesborough’s property tax is one of the area’s lowest – $1.20 per $100 of assessed value, or $600 a year for a house worth $200,000. But that’s about to change.
“The board right now is forced to consider raising that rate and we’re looking at a quarter increase,” Mayor Chuck Vest told News Channel 11 Friday, three days ahead of the Board of Mayor and Aldermen’s first reading on its budget for the fiscal year that begins July 1.
That would cost the owner of that $200,000 house another $125. Vest said local governments aren’t immune to changes in the overall economy.
“We’ve been very efficient over the last two years … we’ve been kind of resisting that with being more efficient and utilizing our own labor,” Vest said.
Last year, though, saw a large raise for town employees, especially those in the lower-paid ranks who each saw $6,000 increases. Combined with generally rising prices for materials and a laundry list of infrastructure and cultural projects, Vest said the town didn’t have much of an option this year.
“We’ve had some projects that we’d hoped to get completed in 2022 that’s kind of carried over to this budget year,” Vest said. Those include completing renovation of the Jackson Theater.
The town also has on its docket paving at Lincoln Park, resurfacing Boone Street, purchasing three snowplow trucks, sidewalks on West Main Street and improvements at Wetlands Water Park — each over $100,000 in cost. Those will be lumped into a 10-year, $1 million capital outlay note.
Jonesborough is one of the fastest-growing places in the region, and a new school about to be completed on North Cherokee Street is requiring a major improvement along that narrow road. Eventually, Vest said, the town wants to tie the road into Boones Creek Road on its northeast end to improve access to the school.
Overall the general fund budget is staying fairly steady at about $12.5 million and includes an additional 3% employee raise. The water-sewer budget, though, will require about $1.7 million more in local funds than it did this year as the town begins engineering and prep work on a new water plant that is expected to cost at least $35 million.
The prospect of a 21% hike didn’t sit well with one homeowner who also has several properties she’s renovating in the historic district.
“People who are looking to move into a pretty desirable area, I think it’s going to turn people off by having that big of a property tax hike when things are already getting so high to buy home and land anyway,” Kati Jenkins said.
Jenkins said the amount of the increase – if it’s 25 cents – is tough to swallow. She said her family is putting significant money into the homes they’re renovating in the historic district.
“Having that hike is going to creep into your budget when you’re trying to completely replaster and drywall some walls in a home, you know. So it just all adds up and I just think that’s a little bit much to start when everything’s been the same for a long time.”
But Vest thinks the town will remain attractive to people looking to move.
“People I’ve talked to going into this kind of understand,” he said. “They’ve all seen the cost increase on them and they know that concrete’s gone up in cost, about all building material’s gone up in cost, for us to put pipe in the ground the cost has just increased triple what it was.
“All those things just create a huge challenge and people understand that.”
He also said people who move to the area and discover the current rate, as well as the potentially higher one, are amazed.
“Even if we have a small increase and we get to $1.40 or $1.45, we’re going to be well below anybody else in the area and certainly lower than where they came from.”
While Jonesborough’s rate is lower than surrounding cities that have their own schools such as Johnson City, Kingsport, Bristol and Elizabethton, it is relatively in line with area towns and cities that don’t have school systems.
This fiscal year’s rates for some of those include:
- Erwin: $1.55
- Rogersville: $1.49
- Mount Carmel: $1.39
- Jonesborough: $1.20
- Bluff City: $1.18
- Mountain City: $1.01
- Church Hill: $0.96
A penny on Jonesborough’s tax rate brings in just under $20,000 and a 25-cent increase would add about half a million dollars to annual revenue. From fiscal 2013 through fiscal 2022, Jonesborough’s property tax revenues were generally flat while sales tax revenues nearly doubled over that time.
The town had $1.7 million in property tax and $1.5 million in sales tax revenues in 2013, and $1.9 million in property tax and $2.6 million in sales tax in 2022.