Farragut to state: return $430k share
Town leaders to Nashville, ask for sales tax restoration portion enjoyed until 2002
Looking to help persuade state lawmakers to give towns and cities a bigger slice of the state sales tax pie — actually restoring what they once received — Town of Farragut’s top elected and non-elected official made a joint trip to Nashville seeking General Assembly assistance that, if ultimately successful, would annually increase Town coffers by more than $400,000.
Mayor Ron Williams, Town administrator David Smoak and Trevor Hobbs, assistant to the Town administrator, traveled to Nashville last week seeking to “talk to our representatives and senators about various bills,” Smoak said to Farragut Business Alliance/Shop Farragut board members during that body’s monthly meeting Wednesday, March 8, in Town Hall.
Of special interest was “a bill that Sen. (Dr. Richard) Briggs (R-District 7, which includes Farragut) and state Rep. (Johnny) Garrett (R-District 45) are helping us with; it’s for all municipalities” statewide, the Town administrator added.
The goal is to restore the state-reimbursed percentage of all annual sales tax revenue collected by Farragut and other state municipalities (4.6 percent) from 1947 until 2002. However, that percentage towns and cities received was not applied to a 1 percent state sales tax increase in 2002 (from 6 to 7 percent) — the state, instead, simply kept 100 percent of that increase.
“A few years ago, the state needed to balance their budget, so they took a certain percentage back from the cities,” Smoak told the FBA/SF board. “It’s been 20 years now but they haven’t given it back.
“We’re asking them — since they’re in good shape — to share that back to us to where that used to be,” he added.
“What that would means for the Town of Farragut would be about $430,000 a year in recurring revenue.”
Also in 2002, the state increased the local sales tax reimbursement cap on the purchase price of a single item from the first $1,600 of that price to the first $3,200 — called the Single Article Cap — yet kept all of the increased tax cap dollars.
As for a bill in General Assembly allowing cities and towns to benefit from the reimbursement jump to $3,200, “that’s kind of slowed down for now,” Smoak said. “… But we’ll see what happens as the budget process goes.
“That would be another significant chunk,” he added. “We don’t have a lot of big purchase-type things in Town, but we certainly have a handful.”
“You’ve got two boat places coming in (to Farragut),” Williams said. “There’s potential there; we’d like to make sure” to collect.
As for tracking the amount, “We don’t get detailed reports from the state,” Smoak said.
About fiscal year sales tax collection in Town, “It’s been a good year so far,” the Town Administrator said.
“A lot of that is a little inflationary … but certainly we’re seeing growth, too, so that’s been encouraging,” Smoak added.
