Jail panel mulls litigation tax

Attorney General Russell Johnson, who serves as chairman of the jail committee, brought the idea before the board last week as a way to help pay for a jail addition.

Presented during the meeting was Public Chapter 897 of House Bill 2145 and Senate Bill 2100, which when the bills passed earlier this year allowed Rutherford County to impose an additional litigation tax for construction and maintenance of a jail, juvenile detention center, workhouse or courthouse project, or to retire debt of such expenses.

“As you can see it’s not a private act,” Johnson said during the meeting. “It is a law of general application that unique way that they make it apply to only one county with population parameters make this apply to (Rutherford) County. ... Other counties are headed in this direction. It’s a matter of this committee voting to recommend to county commission that they ask Matlock, Rep. (Jimmy) Matlock and Sen. (Randy) McNally to add Loudon County to that list.

“Wesley Robertson (County Technical Assistance Service county government consultant) thinks other people will join in on this too,” Johnson added. “In fact, they are contacting all the counties that are currently under decertification to let them know about it and obviously makes it easier if there are a multitude of counties that want to go with it.”

Public Chapter 897 does say that any county with a population no less than 262,600 or more than 262,700, according to 2010 federal census, may adopt a resolution by two-thirds majority vote from the county to levy a “privilege tax on litigation in all civil and criminal cases” no more than $50.

Loudon County’s population as of July 1, 2015, was 51,130.

“As it’s written right now it excludes Loudon County, but there can be legislative action at the state level to have it amended so that the population could include Loudon County or any other county that would choose to be a part of it,” Tracy Blair, county budget director, said.

The topic will be brought before commissioners during the January workshop. The bill deadline is Feb. 6, but Loudon County Mayor Rollen “Buddy” Bradshaw said the county could look to add its name through an amendment.

“(Johnson) talked about that there’s going to be a bunch of folks that may end up jumping on this, so we’d be able to — if it passed — and writing Sen. McNally and Rep. Matlock and Rep. (Kent) Calfee would attach it like the rest of the counties did,” Bradshaw said.

Numbers presented by Blair show the county would be able to help pay for jail renovations through about $120,000 collected yearly for Fund 112, the courthouse and jail maintenance fund, and an estimated nearly $400,000 if an additional $50 litigation tax is approved. During the meeting, Blair said litigation tax collection estimates were “conservative” at 60 percent.

“There have been some options presented that could fall at an amount that this revenue stream for the new litigation tax, plus a portion of the litigation tax that’s already being collected, could fund it without additional revenue,” Blair said. “If a new facility at a new location is considered, then this is not enough.”

Sheriff Tim Guider said he was in favor of the user fee.

“This is our dilemma and it needs to be addressed,” Guider said. “This particular type of funding stream sounded fair as far as that goes.”

Commissioner Leo Bradshaw echoed Guider’s statement. Bradshaw, along with Commissioners Henry Cullen and Bill Satterfield, are on the jail committee.

“People will complain about any cost associated with jails, keeping inmates, enforcement of the judicial system, but when you compare property tax increase or as it’s been thrown up several times a wheel tax, it is much easier to talk about the user, the inmates or the citizens using the judicial system paying a little more money than not having property tax, or not having a tax increase otherwise,” Leo Bradshaw said.

Buddy Bradshaw motioned to recommend a resolution to county commission, and General Sessions Court Judge Rex Dale seconded. The vote passed unanimously.

This consideration comes about a year after Loudon County Commission passed a $50 litigation tax to help fund a second judge.

“I think what the litigation tax is projecting to bring in, that doesn’t cover — I mean that can’t cover a lot of additional tax increases for a new facility of Centre 75, which I’ve had a lot of responses that do not want that there,” Leo Bradshaw said. “But it could totally support the addition here with what would probably be good for 30 years. It makes a lot of sense to fund it through the litigation tax and fund a new facility.”