Monday, December 8, 2008

School Board Taxing Authority Not Receiving Warm Reception

This year the Tennessee School Boards Association is proposing an initiative to change the Tennessee Constitution to give school boards in Tennessee independent taxing authority. We discussed this issue at our regional TCCA meetings in late summer.

Here is an article from the Chattanooga Times Free Press on the topic:

The article quotes Hamilton County Commissioners Warren Mackey (who serves on the TCCA Board of Directors) and Chairman Jim Coppinger as well as Hamilton County Mayor Claude Ramsey.

As things stand right now, the Tennessee Constitution would have to be changed in order to directly give school boards taxing authority. That takes time as such a proposal would have to pass two separate General Assemblies and then be approved by the voters. What could happen right away is that the General Assembly could lift the ban on existing school districts converting to special school districts. We have about 14 special school districts in Tennessee currently, but the law has prohibited the creation of any new special school districts for some time. Special school districts levy a property tax pursuant to a private act adopted by the state legislature that sets a tax rate for the school system. So it would take taxing authority away from the county commission, but would give it to state legislators who usually act based on the recommendations of the school board for the special school district.

Our board has traditionally taken the position that it is opposed to changes that would splinter the authority to levy taxes at the county government level. This proposal seems to be a move in the opposite direction of what is going on in other parts of the country. Other states currently are looking at their local government structure to see if it should be simplified. For example, an Indiana Commission on Local Government Reform issued a report last year recommending a reduction in the number of government entities that had the authority to levy property taxes. The conclusions of that study were that too many levels of taxing authority and decision making ability at the local government level reduced responsiveness to the voters. This study can be found here: To be fair, Indiana has a much more complicated structure of local government than Tennessee and school authorities there do have taxing authority.

Obviously not all county officials are of the same mind on this topic. As reflected in the Times Free Press article, not all school board members agree with this issue either. The article indicates that approximately two-thirds of the TSBA delegates at their annual meeting voted in favor of pursuing this initiative.

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