published Friday, April 27th, 2012

East Ridge challenged on tax vote

WHAT'S NEXT


East Ridge City Council will hold an open work session at 5 p.m. on May 7 to discuss the budget and city tax collection. It will hold a public hearing about the possibility of taking back the city's sewer service on May 14 at 5:30 p.m.

East Ridge council members are taking a second look at their quick decision to collect their own taxes after Hamilton County Trustee Bill Hullander spelled out an extensive list of potential problems several council members said they had not considered before voting.

The council decided to bill and collect its own taxes in a unanimous vote at the end of its April 12 meeting without ever contacting Hullander about the switch or what it would involve.

"There's more to it than you realize," Hullander said as he addressed the council during an agenda session.

The county charges East Ridge 2 percent to bill and collect its taxes, which would come out to $93,000 from the city's estimated $4.6 million in property tax revenue -- if 100 percent of taxes were collected.

Which is never the case, Hullander said.

"The ones that don't pay ... that's where the work really starts," Hullander said.

Hullander said there are still 461 properties in East Ridge on which taxes have not been paid from 2010. Then comes the long process of certified letters, court summonses and the tax auction.

"What's it going to cost East Ridge to do this?" he asked. "You have to have two employees doing nothing but this full time."

Hullander then asked city officials if they had considered the complexities of partial payments or back taxes.

Most council members gave him surprised stares or exchanged worried glances during his talk.

"Did we vote on this? If I had all this information before I voted, I would not have voted," said Councilman Jim Bethune. "We did not get all the facts about this."

The council plans to hold a public discussion about the move May 7.

Backtracking on the tax-collecting decision is one reason the council decided to put off voting on the first reading of its budget during its Thursday night meeting. That has been passed to the May 10 meeting.

"East Ridge is not the only city in the world that collects their own property taxes," said City Manager Tim Gobble. "It can be done. It will involve some expense. But it will also offset some expense."

Gobble has maintained the total savings to the city would be about $100,000.

Besides Chattanooga, Signal Mountain is the only other Hamilton County municipality that collects its own taxes.

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