County voters not buying sales
tax measure
By Thomas Wilson
STAR STAFF
twilson@starhq.com
Carter County citizens answered a resounding
"no" to raising the county's local option sales tax set forth
in a county-wide referendum in Tuesday's county primary.
According to unofficial results Tuesday night,
4,457 county citizens, or 67 percent, voted against raising
the local option sales tax by one-half percent while 2,284
voters, or 33 percent, cast ballots in favor of the measure.
The referendum gave citizens the opportunity
to vote yes or no to increase the county's local option sales
tax rate from 2.25 percent to 2.75 percent. The referendum
failed mightily in all eight county voting districts.
The referendum's fate seemed determined when
early voting totals were released shortly after 8 p.m. Tuesday
night. More than 1,100 county citizens had cast ballots against
the tax increase with just over 600 citizens voting in favor.
Tuesday's election saw anemic voter turnout with
roughly 26 percent of registered voters in Carter County going
to the polls. Of the more than 28,000 registered voters eligible
to vote on Tuesday, final election results reported only 7,494
total ballots cast. Overcast skies and cool temperatures as
well as the sales tax referendum being the only controversial
county item on the ballot likely contributed to the low turnout.
By early afternoon, the Hunter and East Side
precincts had barely exceeded 200 total voters. Linda Payne,
an election official at the Happy Valley voting precinct,
said the county's west end would have a far heavier turnout
at the general election.
"The November election is the big thing out here,"
said Payne.
East Side precinct counted barely 150 voters
late Tuesday afternoon, according to election volunteers.
"We've had a good number of early voters," said Lillian Bullock,
a polling judge at East Side Elementary. "Not a lot of people
have come in."
However, Tuesday's primary did see higher voter
turnout compared to the 2000 county and presidential preference
primary, when only 10 percent of the county's registered voters
-- around 3,000 citizens -- cast ballots.
The referendum's failure closes the door to a
potential revenue source for both county and city governments.
Carter County government officials estimate the one-half percent
increase would produce approximately $700,000 for the county.
The city of Elizabethton Finance Department estimated the
city stands to receive $533,000 in new sales tax revenue.
If the sales tax referendum passed, the Carter County School
System would receive up to $500,000, and Elizabethton City
Schools could have seen an additional $200,000 in new revenues.
Local government leaders have been fidgety about
the possibility of the state government directing municipal
governments to raise their own local option sales tax rate,
while the additional earned revenue would go back to Nashville.
The Tennessee General Assembly voted to increase
the state sales tax from six to seven percent in last year's
session. The Legislature also voted to increase the local
sales tax by raising the cap on single-item purchases from
$1,600 to $3,200, with the state keeping the increase.
Sales tax revenues appear to be on the rise in
the state. The Tennessee Department of Revenue reported last
month that December 2003 sales and use tax collections came
in at $458 million, up $17 million or 3.9 percent over December
2002 collections. The department reported the state's retail
trade group climbed 3.8 percent over collections from last
year while sales tax receipts from the services group were
relatively unchanged, up 0.8 percent over last year's collections.
A city or county can have a local option sales
tax rate capped at 2.75 percent under state law. The state
government captured seven percent of state-shared revenues
-- approximately $150,000 -- going to Elizabethton to balance
Tennessee's fiscal year 2004 budget. City of Elizabethton
employees have received no step pay raises in two years; open
city positions have been effectively frozen, and departments
throughout city government have been forced to cut spending.
City administration estimated that if the referendum
is approved, the new sales tax would factor out to an additional
50 cents in tax money for every $100 spent by consumers in
Carter County.
Two referendums placed on the ballot for Elizabethton
citizens that would raise the city's local option sales tax
by one-half percent failed during the mid-1990s. Both of those
referendums earmarked additional sales tax money to the county
school system.
Carter County voters were not alone in their
opposition to a local option sales tax increase. Across the
state line, Washington County voters also rejected a sales
tax referendum by a margin of almost 3,000 votes. According
to unofficial election totals from that county's Election
Commission, 7,034 people voted against the referendum while
4,122 citizens voted in favor of the sales tax increase. The
referendum would have increased Washington County's local
option sales tax rate from 2.5 percent to a maximum rate of
2.75 percent.