It hasn’t whistled yet, but make no mistake—Knoxville’s next tax hike is on the tracks
K
noxville city officials are again deciding how to divide up your money to pay for things you want, may want, don’t want, or don’t even know about. It’s called the budget process, and it comes around annually at this time of year, just like spring, only more expensive. And about the budget, most Knoxvillians don’t know what they don’t know.
A sentence hinting at what’s in the tax future for city residents and businesses is on Knoxville city government’s website in a summary of a Feb. 14 budget retreat as part of preparation for Mayor Indya Kincannon’s 2025-2026 budget proposal. It says, “Due to sustained rising inflation and pension costs, plus relatively flat overall revenue growth in recent years, City officials noted
a long-term need to increase revenues.” This means that the tax train, probably sooner than later, will be leaving the station. But even without a tax increase, around the city budget there’s always a whole lot of politickin’ goin’ on.
Behind the public, mayoral speeches, council readings, workshops, and other required public-facing budget activities, is a constant push-and-pull of who gets what, and how much? With an annual budget creeping toward $500 million, the stakes are high for Knoxville employees, organizations, and residents. I went through four budget seasons during my tenure as press secretary and public affairs director for Mayor Victor Ashe. Times have changed, but politics haven’t, and what follows are snapshots of the individual personal dynamics that occur behind the speeches, pronouncements, and numbers.
A city employee approached me one budget season
to ask me a question, as my position led people to believe that I knew what was really going on. Employees would sometimes try to cajole, or even trick me, into giving something away about possible employee pay or benefits. “What’s going to be our raise this year?” he asked. Nothing had been decided on that front, so I said, “Well, you know it’s going to be at least two-and-a-half percent.” His response, while not aggressive, had sharpness to it: “That’s what we get. What’s our raise going to be?”
Something that’s even today not well known or understood by Knoxville residents is that city employees are guaranteed by ordinance a 2.5% pay increase every year. Good economy, bad economy, or worldwide pandemic, city employees get at least a 2.5% pay bump. I looked at him, smiled, excused myself, and departed.
I enjoyed, or endured, four budgets during my tenure as Knoxville mayor’s press secretary and city public affairs director. Two went smoothly: budget retreats to nail down city priorities, discussions with city council members individually, the required public activities, and final passage by June 15, before the July 1 fiscal year begins. Every year, the goal was to pass the budget without controversy or conflict.
But two were problematic, requiring heavy doses of politics. The most difficult was the administration’s first budget. For this, a reluctant council passed two budgets: one was with cuts of $3 million to city services; the other, fully funded version, would go into effect if the administration successfully passed a sales tax increase referendum, six of which had failed in the preceding 17 years. A high-intensity campaign saw the referendum pass with 63% of the vote, and money and tax worries were over. For a while.
Several years later, a property tax increase was unavoidable. As we planned how to explain this,
I recalled that during a conference in Washington D.C., I’d attended a panel discussion on unfunded mandates. An unfunded mandate is federal, state, or even local, government passing laws while passing the costs on to someone else. I asked then-city finance director Randy Vineyard if unfunded mandates were a factor in the proposed increase? He checked and said, yes, more than two-thirds.
I had charts made, and Mayor Victor Ashe held a news conference to show city residents that but for unfunded mandates a smaller tax increase would have gone exclusively to city-identified needs. The budget passed without difficulty.
Today, with a smaller local news media, no public conflicts between city and county government, and voter turnout trending low even as city population rises, there’s less focus on city government and the budget. Most people would complain if at a restaurant they order a hamburger and don’t get it how they want it; however, where their city’s budget is concerned, most don’t know about it, or don’t know what they don’t know. And they don’t care. It’s a very curious thing.
Comments are closed.