Trustee delivers positive financial report

Smith updates county leaders

By AUTUMN HUGHES
Posted 8/13/19
Bradley County Trustee Mike Smith has presented a financially positive annual report to the Bradley County Commission.

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Trustee delivers positive financial report

Smith updates county leaders

Posted

Bradley County Trustee Mike Smith has presented a financially positive annual report to the Bradley County Commission.

Speaking during Monday’s County Commission meeting, Smith reviewed the 2018-19 fiscal year as it relates to the Trustee’s Office. Smith explained, “the trustee is the banker of Bradley County,” before beginning his presentation, which included:

• Partial Payment Program: Smith said the 12-month payment plan was implemented in October 2010, to permit payments in advance for the upcoming tax year over a 12-month period. The Trustee’s Office began taking applications for the 2011 tax year in October 2010.

Partial payments begin in March of the tax year and are payable through February of the following year. Payments can be made in person, by mail or by bank draft.

Smith said there are 1,724 taxpayers on the partial payment program for 2019; there are currently 929 bank drafts, 795 walk-in and payments being made by mail.

The total amount to be collected in 2019 by the 12-month plan is $1,298,942; in 2013, the total collected was $347,013.

Smith said this year in October, he estimates the rollover amount will be $548,688; this is the amount the Trustee’s Office will turn over on Oct. 1.

According to the report, the Trustee’s Office also provides a partial payment plan for taxpayers that wish to pay October through February. Partial payments are also accepted on all delinquent taxes until the time that they are transferred to the Clerk & Master’s Office.

Smith noted the partial payment programs have been approved by the Tennessee Comptroller’s Office and the Bradley County Commission.

• Tax Freeze and Tax Relief programs: Smith said there are 1,192 parcels on tax freeze, which is a state program available for taxpayers 65 years of age and older. Bradley County adopted this program in 2007.

The Tax Freeze Program provides for tax to be frozen at the tax amount for the year the property owner initially qualifies for the program. The tax amount will not increase as long as the property owner meets the eligibility requirements, and there is no adjustment to the assessed value.

In order to qualify, the homeowner must file an application annually, and meet guidelines available online at www.bradleytrustee.com/#/taxFreeze.

The Tax Relief Program is a state program to reimburse certain homeowners who meet the legal requirements, for a part or all of property taxes paid, and is not an exemption. Taxpayers will still receive their tax bill(s) and be responsible for paying property taxes each year.

Smith said there are 1,501 taxpayers on tax relief; of those, 1,178 are elderly, 155 are disabled veterans, 129 are disabled, and 39 are disabled veteran widow/widower. Smith said Bradley County taxpayers received $302,847 in tax relief.

For more information, visit www.bradleytrustee.com/#/taxRelief.

• Sales Tax Collections (site based): Smith said the Bradley County Trustee’s Office collects taxes for Bradley County, the city of Cleveland and the city of Charleston.

“The biggest increase this year is in the city of Cleveland,” Smith said, noting there was also a “pretty good” increase for the city of Charleston.

Sales tax collections were $33,631,501 for the city of Cleveland, $5,465,456 for Bradley County, and $617,896 for the city of Charleston.

• Sales Tax Distributions: Smith said the 2018-19 sales tax distributions were to Bradley County ($6,099,328), Bradley County Schools ($12,671,411), Cleveland City Schools ($6,962,620), city of Cleveland ($13,229,230), and city of Charleston ($302,418).

• Tax Revenue: Smith said a combined $45,035,391 in real property, personal property and utilities were billed in last October. Previous totals were $44,313,301 (2017), $43,551,656 (2016) and $42,095,816 (2015).

• In-Lieu-Of Taxes: Smith said the total paid in 2018 was $3,915,916; he added the total has decreased every year.

“These companies are getting a break,” but will pay 100% of their tax amount as they come off the in-lieu-of tax rolls, Smith said.

Of that $3.9 million amount, Amazon paid $191,180; Gillette paid $43,872; Mars paid $53,164; Wacker paid $3,329,698; Whirlpool paid $266,842; Air Liquide Electronics LP paid $4,296; and Linde Gas North America paid $26,864.

• Investment Policy: Smith said Bradley County’s investment policy target is 100% of the Federal Fund Rate for interest earned. In the 2018-19 fiscal year, the interest earned was 107% of that rate. Smith added the new banking contract through 2022 will pay 10 basis points above the Federal Fund rate on all Bradley County bank accounts.

Smith also discussed the interest increase over the past 13 years due to current investment strategy when compared to investment strategy prior to Sept. 1, 2006; that amount is $5,865,197.

• Total Interest Collected: Smith said $11,381,257 in interest has been collected from September 2006 to June 2019.

“We’re really proud of our investment policy,” he said.

Smith also recognized the Investment Committee: Chairman Buster Stuart, Gary McDonald and Roger Fuller.

• Excess Fees: Smith said in 2018, $837,860 in excess fees were returned to Bradley County. Since 2006, $9,522,080 in excess fees have been turned over to the county from the Trustee’s Office.

“We try to return as much back as we can,” Smith said.

• Efficiency: Smith said, since 2006, “The Trustee’s Office has implemented numerous programs to assist Bradley County taxpayers. In addition, the number of parcels to be collected has risen from 46,591 in 2006 to 53,494 in 2019, a 15% increase.”

Smith also noted that in 2015, the Trustee’s Office also began collecting Charleston city taxes.

“Through improved technology and management practices, we have reduced the staff level that was in place in 2006,” Smith said. “While there are additional programs that will be offered in the future, there are no plans to increase staffing.”

• HCI Fund: Smith said the current CD balance is $8,480,063, invested at 2.5% interest. There are three Interfund county loans: $1,966,900 at 2.39% interest for the workhouse at the Bradley County Justice Center; $2,798,500 at 2.37% interest for the Spring Branch Industrial Park; and $3,586,153 at 2.39% interest for the Courthouse renovations.

Smith said the total Hospital Funds — CD and Interfund loans — is $16,831,616. With a return of 1.9% from July 2018 to June 2019, the estimated total return for the 12 months ending Dec. 31, 2019, is $320,000. Smith said 15%, or $48,000, will be withheld, along with an estimated $120,000 for Library bond payments; that will leave approximately $152,000 available for HCI grants or hold for future projects.

• Long Term Investments: Smith said the Trustee’s Office is fortunate to invest in Bradley County banks, with long-term investments of $23,480,063.

Smith said investments are held at SouthEast Bank ($2 million at 2.51% interest), Southern Heritage Bank ($2 million at 1.44% interest), Athens Federal Community Bank ($6 million at 2.60% interest), First Tennessee ($2 million at 2.85% interest, and $8,480,063 at 2.50% interest), and Pinnacle Bank ($3 million at 2.79% interest).

• Electronic Billing: Smith said electronic billing with email and text alerts began with the 2017 billing cycle. In 2018, a total of 50,757 parcels were billed; of those, 15,110 (30%) of statements were paid through online, mobile or attachment download. Smith estimated by 2022, 38% of all parcels will be paid electronically.

Smith noted the benefits of electronic billing include reduced labor, printing and mailing costs. However, he added, “as long as we have taxpayers that wish to have a paper statement mailed to them, we will provide that statement.”

Further discussing reduced labor, Smith said from 2006 to now, his office staff has decreased by one full-time employee, while part-time help has been added in the busy seasons.

“We had a retirement — no one was terminated,” Smith said, adding he is proud the Trustee’s Office is not asking for additional employees.

In closing, Smith said he appreciates the support from County Mayor D. Gary Davis and the County Commission, as well as their good working relationship.

After Smith’s presentation, Commissioner Dennis Epperson said he appreciates all Smith does for Bradley County. He asked if the trustee’s Investment Committee membership was approved by the County Commission. Smith said it was and noted the three members also serve as Bradley County’s Investment Committee.

Epperson also asked how taxpayers can get participate in the Tax Freeze Program. Smith said there are guidelines and he is working on brochures that should be ready and available from his office in a few weeks.

Commissioner Milan Blake asked Smith if there are any upcoming legislative initiatives he plans to ask the County Commission to look at. Smith said the next session of the Tennessee General Assembly is not until January, but trustees statewide are looking at a few issues, like a better way to collect delinquent property taxes.

Commissioner Charlotte Peak also asked about the Tax Freeze Program, specifically if an elderly resident came to the Trustee’s Office now, wanting help with the recently increased property tax rate. Smith said to be eligible for a tax freeze this year, taxpayers had to sign up last year.

Peak also asked Smith how he likes his office’s location at Keith and 17th streets.

“It’s worked out great for the citizens,” Smith said, giving the mayor and County Commission credit for deciding to allow the Trustee’s Office to remain in what had been its temporary location while the Courthouse was being worked on after a fire that closed the building for more than a year.

For more information about the Bradley County Trustee’s Office and its programs, visit the office at 1701 Keith St. N.W., call 728-7247, or visit www.bradleytrustee.com.

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