Tuesday, November 26, 2019

How The Tennessean and liberals promote the idea that we are undertaxed.

An article in today's Tennessean, "Analysis: Amid debate over Nashville budget, no avoiding conversation of raising taxes," summarizes a lot of what has been widely reported.  Nashville is spending more than it is bringing in, the current budget relied on a $41 million plan to privatize public parking and that deal is now dead, and Cooper is tying to fix the mess without raising property taxes.

One thing Cooper has already accomplished is getting the Music City Center to kick in more revenue to the city.  The increased amount however only comes to $2.6 million more than the previous agreement. We are a long way from a balanced budget. Before becoming mayor, as a council member, Cooper initiated the creation of the Blue Ribbon Committee tasked with finding $20 million in savings in the city budget by identifying inefficiencies, subsidies and other costs that can be trimmed.  The Blue Ribbon Committee is making progress but we don't know if they can reach that goal. Even if they do we are still short.

The article does a good job explaining the history of property tax rates and the revenue that could be raised by a tax hike. The article like many others focus on our modest tax rate of $3.155. The article points out that the Shelby County tax rate, the highest in the state by comparison is $7.77.  I disagree with those who claim we are under taxed.

In these comparisons, one thing that is lacking is an acknowledgement that we have much higher property values. I don't know how much higher, but I know that a house in Nashville would cost considerably more than the same quality and type of house in Shelby County or Knox County.  I don't have the time or means to document this point with examples but the information is available if one did the research.  I would be willing to wager that a  house in Nashville may be appraised at more than twice the appraisal of a similar quality and type and size home in either of these other counties.  A low tax rate applied to a million dollar home may still result in a bigger tax bill than a higher tax rate applied to a $400,000 home.

Another thing this is lacking is an acknowledgement that our higher tax rate covers most of the county. Most of these examples used by the press compare the combined city and county rate of another city with Nashville's combined Urban Services District and General Services District. The difference between the Urban Services District and the General Services District is not that much. As an example, the General Services tax rate in Davidson County is $2.755. The Knox County tax rate is only $2.12,  so a lot of people in Davidson County have a higher property tax rate than people in Knox County.

If the press wanted to enlighten rather than propagandize for higher taxes, the line of reasoning I have been presented would be examined and reported.

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