County clears way for fire-damaged housing rebuild

Washington County has approved a payment in lieu of taxes program for the rebuilding of Johnson City Housing Authority's Fairview Apartments. The Washington County Commission met on Monday for a special called meeting to discuss the upcoming fiscal year budget followed by its regular meeting. JCHA's PILOT program The commission's approval of a PILOT program for JCHA to rebuild its property known as Fairview Apartments reduces taxes for the project to more than 5% for a minimum of 15 years. The apartment complex is currently unoccupied and has been for 10 years. The existing structures need to be torn down due to fire damage to rebuild a new complex. Property taxes made by JCHA through the PILOT program will only be received by the City of Johnson City — the county will not receive any property taxes from JCHA. The county's funds have no impact with the approval of this program. Additionally, the approval of the resolution does not grant JCHA to enter a PILOT program until the Johnson City Commission gives its approval. Without a PILOT program, JCHA would not be able to rebuild on the property, and it would remain dormant. FY27 budget discussion During the commission's special called meeting to discuss the upcoming fiscal year budget no actions were made. Mitch Meredith, Washington County's director of finance and administration, presented to the full commission an estimated budget overview as well as estimates for property and sales tax collections, the general fund and special appropriation requests. The county's estimated budgeted fund balance is expected to be more than $22.5 million by the end of the current fiscal year on June 30. Meredith said the fund could reach $23 million because most departments will not spend its entire budget. The estimated expense budget for FY27 is more than $10 million higher than the revenue budget with an estimate of more than $74 million. The deficit is not out of the ordinary, and the county has budgeted this way for years, Meredith said. "The reason that you've got that deficit is because … last year had a $7 million deficit and those are reoccurring dollars," he told commissioners. "You're really looking at … a delta of $3 to $4 million this year on top of what you had last year." The general fund reserve policy the commission approved may present a challenge for the county by the end of FY27. The policy states the county's minimum general fund balance should equal to four months of the prior year's average operating expenditures with some exclusions. The projected fund balance by the end of FY27 is more than a $5 million deficit than what is required by the reserve policy for the general fund. Meredith said this deficit raises concerns for FY28. Concerning property taxes, the county is expecting to collect 98% which is 1% more than what is budgeted. The estimate collection is more than $97 million — a nearly $2 million increase than last fiscal year's collection. The county receives 40% of property tax collections — the remaining 60% of funds is split between the Washington County and Johnson City school systems, the solid waste and highway department, debt services, capital projects and educational capital projects. The school systems will receive most of the remaining property tax collections at 29%. Additionally, the estimated rural local option sales tax collections for the county is $9.9 million. Half of the sales tax for FY27 goes to Washington County and Johnson City school system and the other half goes into the county's general fund. Meredith also presented special appropriations requests from each county department totaling to nearly $10.5 million. Some requests will not be approved by the commission. Other agenda items Other business approved by the commission included an updated hazardous mitigation plan, the spending of educational capital fund projects of up to $500,000 for WCS to purchase new technology equipment and a proclamation declaring April 2026 as National Donate Life Month. The hazardous mitigation plan has been prepared in accordance with the Federal Emergency Management Agency's requirements and addresses both natural and man-made hazards to mitigate risks for the people and property of Washington County. The 193-page updated version of the plan addresses 13 hazards which have an impact on both Washington County and the incorporated jurisdictions including the town of Jonesborough and the city of Johnson City. Jurisdictions who have a hazard mitigation plan are also more likely to receive grants from FEMA and state emergency management agencies in the case of hazard. The approval of spending up to $500,000 from educational capital project fund will fund the purchase of 625 Chromebook laptops with management console licensing and 330 wireless access points and mounting hardware for WCS. The commission also appointed Michael James, Fred Malone Jr. and Ann Holden to the Washington County Board of Equalization with Jack Cox as an alternate. The commission will have its next meeting to discuss the FY27 budget on May 12 at 5 p.m. in the George P. Jaynes Justice Center where presentations will be given by departments and organizations who requested funds for special appropriations. Its regular monthly meeting will occur on May 18 at 6 p.m. in the George P. Jaynes Justice Center.