Mayor Seema Kincannon asked the City Council at a workshop to send a half‑cent increase in the local option sales tax to Knoxville voters, saying the measure would raise an estimated $47 million annually and pay for sidewalks, road paving, greenways, parks, facilities maintenance and additional affordable‑housing investment.

The proposal would raise the local option rate in the city from 2.25 percent to the state maximum of 2.75 percent; state law caps the local option at 2.75 percent and limits that portion of the tax to the first $1,600 of any purchase. Kincannon said the increase must go to voters under state law and that, if approved in November, the new rate would take effect March 1.

Why it matters: Kincannon framed the request as a way to address growing deferred maintenance and to accelerate plans already in the city’s capital and master plans. “This is about our future,” she told council members, saying the city is approaching 200,000 residents and that rising usage of parks and roads is increasing wear and tear.

Details of the proposal and timing
- Estimated revenue: Kincannon said the half‑cent could raise about $47 million based on the last full fiscal year’s sales tax revenue; she noted the amount can fluctuate with consumer spending. If Knox County chooses to bring the question countywide and the countywide measure passes, she said the city would retain approximately 50 percent of that revenue (roughly $23.5 million) while the remainder would go to Knox County Schools. If the city‑only measure passes, the city would retain 100 percent of the increase.
- Ballot and ordinance timeline: Kincannon said staff will present an ordinance at the council’s June meetings for first and second reading to place the question on the November ballot; she also said the council could adopt, at the same time, a separate ordinance to exempt groceries from the half‑cent increase if voters approve the measure.
- Grocery exemption: Kincannon said the administration plans to exempt groceries using the state’s legal definition (commonly referred to in state law as “food and food ingredients”) and indicated the exemption would apply only to the additional half‑cent, not to existing sales tax rates.
- Ballot language and election rules: Chris Davis, executive director of Knox County Elections, told the council that state election rules constrain the ballot question (he said responses are cast “for” or “against” rather than “yes” or “no” and that the question must be concise). Davis also estimated that, if the county opts in and a countywide referendum were required, added election costs could be on the order of tens of thousands of dollars (he cited roughly $15,000–$20,000 as a plausible additional cost if the county fully piggybacks on the city election).

Council questions and staff clarifications
Council members pressed for specificity and accountability. Several members said voters will expect district‑level lists of projects (for example, which sidewalks or which park improvements will be completed) before the council votes to place the measure on the ballot. Kincannon replied that the administration is compiling a five‑year plan with district‑specific projects and performance tracking and said she would meet with council members to refine priorities.

Cost and scope context
- Sidewalks and paving: City staff and council members discussed common planning figures: sidewalk construction is often estimated around $1 million per mile (cost varies by site conditions) and the city currently budgets roughly $10 million a year for paving (a number council members said translates to roughly 36 miles per year under existing practice). The city’s roadway inventory was described as roughly 1,200 miles.
- Affordable housing: Kincannon said the proposal would add $10 million above a prior $50 million city commitment to affordable housing and that city gap financing typically leverages substantial private investment (she said $1 of public gap financing has historically catalyzed about $15 of private investment, as described in the presentation).

Protections, limitations and examples
Kincannon said the half‑cent would not affect property tax, gas taxes, prescription drugs, health‑care visits or utility (KUB) bills, and she listed everyday examples of the incremental impact for households (for example, an average household under $100,000 annual income might see about $12 per month in additional sales tax under the estimate shown). She reiterated that groceries (as defined by state law) would be exempt from the additional half‑cent if the council adopts the concurrent trigger ordinance.

Next steps and accountability commitments
Kincannon said staff will present draft ballot language and the two ordinances (ballot placement and the grocery exemption trigger) at the June council meetings. She told council members that, if voters approve the increase, the city will publish a project tracker showing year‑by‑year, district‑by‑district investments, groundbreakings and ribbon‑cuttings to allow public tracking of pledged projects.

No formal council action was recorded at the workshop; the item was presented for discussion and staff direction. Mayor Kincannon and staff asked council members for feedback and one‑on‑one meetings to finalize district project lists prior to any first reading.

Ending: The council indicated support for continued public outreach and asked staff to return with the ordinances, draft ballot language and the detailed five‑year plan for council review before any first reading.