Johnson City commissioners flirt with potential property tax increase

Johnson City commissioners reviewed sales and property tax revenues at a meeting Thursday that left the board's position on a potential rate increase unclear. Following City Manager Cathy Ball's draft budget presentation at the work session, commissioners considered their options on budget additions and income sources, hinting at potential local property or sales tax rate increases. "Property tax increases put all of the burden on property owners in the city," Mayor Greg Cox said before suggesting a possible local sales tax rate referendum. Johnson City's local sales tax rate currently sits at 2.5%, according to the Tennessee Department of Revenue. If voters chose to increase this rate in a referendum, it would be the city's first sales tax hike since 1994. "There's been a tremendous amount of growth in the area and a lot of it's in the county and different areas surrounding us," Cox said. "They're coming into Johnson City using our parks and roads and red lights and our infrastructure every day — which we love — but it does put wear and tear on it." None of the other commissioners voiced their support of a sales tax referendum, however. Vice Mayor Jenny Brock explicitly opposed it. "I would not support the sales tax approach because it's very disproportionately hard on our lower income families, for sure," Brock said. Johnson City's property tax rate is $1.3785 per $100 assessed property value, which is nearly 30 cents and 47 cents lower than that of Kingsport and Bristol, respectively. "If we were to act on this, we would still have the lowest tax rate of all of our neighboring cities that maintain school systems," Commissioner Joe Wise said of the difference in property tax rates. "I think that is a testament to our overall fiscal stewardship and it's what gives me the level of confidence I have supporting staff." Ball did not directly propose an increase to local tax rates during her presentation, however she did provide a staff recommended general fund budget and that the commission consider implementing a state property tax relief program. In addition to tax rate talks, Wise, Brock, and Commissioner Todd Fowler all expressed their support of the staff-recommended Fiscal Year 2027 budget that would add $8.8 million in added expenses to the city's proposed $122 million base budget. The additional funds include a $2.8 million debt service to begin a full buildout of the total $37 million aquatics facility.