ISSUE #1: GROWTH . . . . . . . . . . . HOW DO WE PAY FOR IT?

Please Note: The Alternative Revenue Task Force decided in June 2004 to recommend an Adequate Facilities Tax rather than an Impact Fee to the County Commission. Since the Impact Fee is no longer a viable option, the RNA supports the County Commission's resolution for an Adequate Facilities Tax in order to lessen the burden of growth on the property tax payers.

Needed to view pdf documents:


BACKGROUND
 

NEWS! ... PUBLIC MEETINGS, REPORTS, ETC.

WHAT ISN'T WORKING & WHY
 

 March 15, 2005

1500+ voters of Rutherford county signed the RNA Petition encouraging State Legislative delegation to support a private Act for Rutherford County. Copies were presented to each of our lagislators.

PETITION

We, the undersigned, urge the Tennessee State Legislature to approve the Rutherford County Commission's resolution for an Adequate Facilities Tax on new construction. Currently, Property Taxes and Wheel Taxes are the
major sources of county revenue. The growth in Rutherford County will require more than $500,000,000 just for schools (DNJ 20Dec04) over the next ten years. We don't want an increase in Property Taxes and/or Wheel Taxes to be the only way to pay for growth.


 May 14, 2004

 

ACTION

ALERT!

 Questionnaire responses now 2 to 1 in favor of taxes or fees on new development over other alternate revenue sources.

Keep those responses coming in. Call your commissioner and express the need to have an Impact Fee that is proportional to growth and that will go directly to funding the infrastructure needs created by growth.



  Apr. 20, 2004  MEETING MINUTES in .pdf format
   
 Apr. 16, 2004  MEETING MINUTES in.pdf format
   
 Mar. 30, 2004 MEETING MINUTES in .pdf format
   
  Mar. 9, 2004

 FOURTH MEETING of TASK FORCE -Members

Present: Jim Baker, Rebecca Climer, , Joyce Ealy, David Gilliam, Denny Hastings, Bill Jones, Lisa Nolen, Jeff Phillips, Steve Schroeder, Doug Shafer Absent: Joe Jack Dement, Harry Gill, Steve Sandlin,

   
 Mar. 2, 2004

 THIRD MEETING of TASK FORCE -Members

Present: Jim Baker, Rebecca Climer, Joe Jack Dement, Joyce Ealy, David Gilliam, Denny Hastings, Bill Jones, Lisa Nolen, Jeff Phillips, Steve Sandlin, Steve Schroeder, Doug Shafer Absent: Harry Gill

 
 March 1, 2004   STEERING COMMITTEE MEETING NOTES

Since there was no representative from the County Technical Assistance Service present at the meeting (as was directed by Steering Committee action at the February meeting) to help the Steering Committee draft a resolution for an Impact Fee, Steve Schroeder of the RNA was asked to talk about impact fees.

Steve presented the study done by the RNA which estimated the amount of revenue an impact fee on single family homes would generate for the county.

The Steering Committee recessed this meeting until Monday, March 8th at 7 pm in order to have more time to get a resolution written for an Impact Fee that can be brought before the full commission on March 11th.. The committee passed a motion (4 to 3) made by Commissioner Peay to have the county attorney work with CTAS (County Technical Assistance Service), the chair of Steering, the County mayor and any other interested commission members to write an Impact Fee Resolution.

March 8th continuation - Josh ___, of the Legal Department came with an inadequate version of an Impact Fee Resolution. All but one commissioner present (Rick Sage was absent) voted not to sent it to the full commission with the reasoning that the Task Force should be allowed to do its job first. Only Commissioner voted for the resolution, recognizing the fact that a no vote meant that there was no way for the county to have this as a revenue option until May of 2005 because of the State legislative requirements.

   Feb. 24, 2004

MEETING MINUTES in .pdf format - Members

Present: Jim Baker, Rebecca Climer, Joe Jack Dement, Joyce Ealy, David Gilliam, Denny Hastings, Bill Jones, Lisa Nolen, Jeff Phillips, Steve Sandlin, Steve Schroeder, Doug Shafer Absent: Harry Gill

 

 Research Criteria for study established:

  • Is the method feasible or "doable"? Can it be implemented from a legislative standpoint? Has it been done elsewhere, how has it worked? Would there be support for this method?
  • How much money would the method generate? Annually, over 5 years, over 10 years?
  • What is the possible impact of this method? On specific groups of people: the poor, existing homeowners, seniors, working poor, new homeowners, young couples, others? What businesses would be affected?
  • Is this tax fair and equitable when considering other taxes currently in place?
  • Is this a recurring or one-time method of revenue?
  • Would this create additional government bureaucracy? If so, how much? Who would oversee and collect it? Any additional staff needed?

Group Assignments established:

  • Group One to report April 13 on Impact Fee, Adequate Facilities Tax, Development Tax - Steve Schroeder, Jim Baker, Steve Sandlin
  • Group Two to report March 16 on Gasoline Tax -Doug Shafer, Joe Jack Dement
  • Group Three to report March 23 on Local Realty Transfer Tax and Mortgage Tax - Rebecca Climer, Lisa Nolen, Bill Jones
  • Group Four to report March 30 on Business Tax - Harry Gill, Jeff Phillips
  • Group Five to report April 30 on "Other" - Lisa Nolen, Denny Hastings, Joyce Ealy, David Gilliam

 FEB. 19, 2004

FIRST MEETING of TASK FORCE - Members

Present: Jim Baker, Rebecca Climer, Joe Jack Dement, Joyce Ealy, David Gilliam, Denny Hastings, Bill Jones, Lisa Nolen, Jeff Phillips, Steve Schroeder, Doug Shafer Absent: Steve Sandlin, Harry Gill

Chamber of Commerce Bldg. - 501 Memorial Blvd., Murfreesboro

TN Code Annotated 8-44-102. Open Meetings Act: the Task Force meetings are required to be open to the public.
 February 12, 2004

FIRST STEP TOWARD FINDING ALTERNATIVES TO RAISING PROPERTY TAXES OR CUTTING SERVICES IS ACCOMPLISHED!

The Rutherford County Commission approved two tax resolutions to assure that they have an alternative to raising property taxes.

One resolution for a Public Act to allow a realty transfer tax will be sent to the State Legislature even though the deadline for submission has passed. Sixteen commissioners agreed that the request process should start now for the next legislative session.

The second resolution is for a replacement development tax that can be increased to a ceiling of $2500 (the current development tax limit is $1500 per home or dwelling unit), but that can also be lowered if need be. This flexible development tax could prove useful should the County RevenueTask Force recommend a combination of taxing alternatives that does not require a $1500 Development Tax. Fifteen commissioners recognized the value of having this taxing option available.

A 2/3rds vote was necessary to pass each resolution.


 Commissioners voting against the Realty Transfer Tax:


   Rodgers, Carol Cook, Dwight Throneberry and Allen McAdoo

 Commissioners voting against the variable rate Development Tax:
 

   Rodgers, Cook, Throneberry, McAdoo and Paul Johnson
 
Commissioner Tina Jones was not present.

FEBRUARY 2, 2004 - County Steering Committee : ALTERNATE REVENUE SOURCES TASK FORCE MEMBERS ARE NAMED by Steve Benefield, President, Rutherford County Chamber of Commerce.

Representing Government:
1)
Jeff Phillips: Chair, Rutherford County Steering Committee (District 17)
2)
 Doug Shafer: Co-Chair, Rutherford County Steering Committee (District 1)
3)
 Joyce Ealy: Chair, Rutherford County Budget/Finance Committee (District 19)
4)
 Steve Sandlin: Co-Chair, Rutherford County Budget/Finance Committee (District 9)
5)
 Harry Gill: Director, Rutherford County Schools
6)
  Lisa Nolan, Rutherford County Finance Director
 

 Representing Business:
1)
 Denny Hastings: Rutherford County Home Builders Association

2)

 David Gilliam: Middle TN Association of Realtors
3)
 Joe Jack Dement: Rutherford County Farm Bureau (Benefield said that he was recommended by the realtors and builders)
4)
 Bill Jones: Destination Ruitherford
5)
 Rebecca Climer: Rutherford County Chamber of Commerce
 

 Representing the Senior Citizens of Rutherford County:
1)
 Jim Baker: Industrial Development Board
 

 Representing the citizens of Rutherford County:
1)
 Steve Schroeder: Rutherford Neighborhood Alliance


JANUARY 5, 2004
- COUNTY STEERING COMMITTEE HEARS PRESENTATION OF MTSU Business & Education Research Center (BERC) STUDY ON ALTERNATE SOURCES OF REVENUE for RUTHERFORD COUNTY. (Click to view this study in .pdf format)

STEERING COMMITTEE calls for a 13 member citizen/government/business taskforce to discuss Alternate Revenue Sources.
NOVEMBER 6, 2003 - JOINT STEERING COMMITTEE/BUDGET

Consultant: Impact fees 'one-time' growth charge

By Byron Hensley / Staff Reporter of the Daily News Journal / Monday, Nov. 10, 2003

Impact fees are a "one-time, up-front charge" used to pay for capital facilities necessitated by new development, a consultant told Rutherford County Commission's Steering and Budget committees.
Communities across the country facing rapid growth typically have trouble keeping up with roads and schools, said Jim Duncan of Duncan & Associates, an Austin, Texas-based consulting firm specializing in impact fee and smart growth studies for states and communities.
"Rapid growth equals crowded highways, schools and inadequate funding," he told commissioners in a packed Rutherford County Courthouse last Thursday night.
"An impact fee is a regulatory fee, not a tax," he said. "It's a one-time, up-front charge at the time the development is done."
Impact fees are used to pay for capital facilities costs only and may not be used for operating expenditures, Duncan said.
They are levied on new development only and residents of existing structures do not pay them, he said. They are based on a predetermined formula used to estimate the need for new capital facilities a new structure will create. They can be used for construction or expansion of off-site facilities and are charged when a developer applies for a plat or building permit.
Among the things that impact fees are not, he said, is a deterrent to affordable housing.
"Their whole purpose is to increase the supplies of available infrastructure," he said. "If you don't have water or sewer lines or roads, you're not going to build."
Nor are they necessarily an economic development deterrent, because companies looking for areas to locate consider the availability of adequate schools, roads and other facilities, which impact fees help to fund, he said.
To charge an impact fee on a particular development, a community must use a "rational nexus test" to show the development creates a need for new facilities, and must receive benefit from them, Duncan said. The community must also have legal authority to charge the fee, which in Tennessee requires a private act of the state Legislature.
County officials called the presentation informative but said more information will be needed to determine just how impact fees may benefit the county.
"I think we got a lot of good information, and I think there are opportunities we may have that I didn't know we had," said County Commissioner Jeff Phillips, steering committee chairman.
As county officials move toward a decision on impact fees, the information will be used in context with a study on alternative revenue sources being prepared by MTSU, along with discussions with members of the development community and residents promoting the impact fee, he said.
"This is not something we need to move quickly on, but it is something we need to move on," Phillips said. "We need to listen to groups that may be affected positively or negatively and see if there are other ideas that may be beneficial to the community. We need to get busy, but we don't need to rush on this. We need to understand just what we're getting into."
Impact fees can be done with a great deal of flexibility, Duncan told commissioners. For example, they can be set up to exempt or target specific areas or specific components of public service. They should be reviewed and updated on a regular basis, he said.
Duncan presented "The Ten Commandments of Impact Fees," including promoting smart growth policies, involving local stake holders such as home builders and developers as well as owners of existing structures, using them only for capacity increase and capital needs, allowing independent fee studies, establishing a rational nexus test, and using appropriate methods for determining the fees.
Among the "shall nots," he said, communities cannot use them to correct the "sins of the past," using them to "catch up" with existing financial needs and cannot "double-dip," such as charge impact fees along with other types of charges to pay for the same needs.
Impact fees must be used in the areas where they are collected, and must be used within a specific amount of time, typically seven years, Duncan said.


HOW & WHY IMPACT FEES WORK
 
RESEARCH & DOCUMENT LINKS 
 
SUCCESS STORY: SMYRNA
 
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