Amendment to return shared revenues easier wrote than done

By Thomas Wilson
STAR STAFF
twilson@starhq.com

   An amendment to return state-shared revenues to city and county governments excites local finance directors, but Gov. Phil Bredesen's reluctance to support the bill means municipalities may not see those revenues restored for at least one more year.
   Sen. Ron Ramsey, R-Blountville, has proposed a budget bill amendment that seeks to return $35 million in state-shared revenue taxes to city and county governments as a one-time measure. The state trimmed 9 percent of shared revenues last year when Gov. Phil Bredesen used those dollars to help balance the state budget.
   "We took that money last year and we now have a chance to give it back," Rep. Jerome Cochran, R-Elizabethton, said Tuesday.
   The city of Elizabethton had estimated a loss of $150,000 in state-shared revenues from its 2004 fiscal year budget. After accounting estimates were in, the city lost approximately $115,000, according to Brad Moffitt, city director of finance.
   After two consecutive years of double-digit budget cuts, Elizabethton City Council passed on first reading the city government's $11.9 million general fund budget at last week's council meeting. The budget factors in the lost shared revenues city officials did not expect to be restored.
   City administrators made $1.2 million in cuts from its proposed 2004-2005 budget primarily from capital requests submitted by city departments. Moffitt said the city had cut capital expenditures to the bone over the past three years - a pattern causing concern among department administrators.
   "We have cut on capital to the point where it is really hurting us," said Moffitt.
   He said one city vehicle had in excess of 200,000 miles while several other vehicles were hovering between 140,000 to 160,000 miles. While restoration of the shared revenue would not solve all those problems, Moffitt said the funds could alleviate some of the city's capital improvement issues.
   "We wouldn't be able to do all of them, but it would go a good way," he said. "(Ramsey) has our support because we desperately need it."
   Lost state-shared revenues cost Carter County government roughly $200,000 last year. Jason Cody, director of finance for Carter County government, said the county would welcome new budgetary options the funding could provide. He said obvious needs of the Carter County Jail and county school system are two general areas that would take priority if the revenues are restored.
   "We were in a tight spot last year," said Cody. "Even $200,000 would definitely help you."
   The Tennessee Department of Revenue projects a $93 million revenue surplus for the state at the end of the 2004 fiscal year. Bredesen said earlier this week he opposed returning the shared revenues this year, but those state-shared taxes might be returned in two to three years.
   Cochran disagreed with the governor's position of waiting to return local dollars until the state is in better economic condition. He said if the Senate could pass the amendment it would help tremendously.
   "When you have surpluses, I don't know how much better it can get," said Cochran. "The only reason to not give it back is if the state wants to use it for more spending in Nashville."