Red Bank commission approves first reading of 2025–26 budget that signals intent to exceed certified tax rate

The Red Bank Board of Commissioners approved first reading of the city’s fiscal 2025–26 budget on May 20 while staff and commissioners debated wording that staff says signals an intent to exceed the state’s certified tax rate to capture an estimated 5% increase in property‑tax revenue.

City Manager Granham told the commission the formal budget packet required by the Tennessee Comptroller "bakes in" a 5% increase in property tax revenue and that the packet includes the statement that "the governing body does intend to exceed the certified tax rate." The packet item cited by staff shows a local‑taxes line of $8,239,080 and, according to staff discussion, the added property‑tax projection increases the property‑tax line by roughly $262,000 over the prior estimate.

Why it matters: the certified tax rate that the state issues after the county assessor’s reappraisal will determine the mechanics of any rate change. Staff told the commission that the budget ordinance is presented now with a revenue projection and that a separate tax‑rate ordinance will follow after the Comptroller issues the certified tax rate; the commission will take two readings and hold a public hearing on any tax‑rate ordinance.

During discussion commissioners pressed staff for context on how the figure was calculated and how reappraisal changes translate to individual tax bills. CFO Chris Pickle and City Manager Granham explained the 5% figure is a jurisdiction‑level revenue projection, not a guaranteed uniform parcel increase: the reappraisal produced a median assessed‑value increase (discussed in the meeting as about 59.05%), and the commission was told that individual parcel bills will vary depending on how each parcel’s assessed value changed relative to the median. Granham said the city will not know the required tax rate to deliver the projected revenue until the state issues the certified tax rate in the summer.

Commissioners discussed tradeoffs between remaining “revenue neutral” (accepting the state’s certified tax rate) and remaining “service neutral” (seeking additional revenue to preserve service levels and cover inflationary pressures such as salary and equipment costs). Commissioner Fairbanks Harvey framed that decision as choosing whether to allow service levels to decline or to raise revenue to maintain current services. Several commissioners and staff cited recent inflationary increases in equipment and contract costs as the rationale for the modest revenue projection.

City finance staff also told the commission the city’s projected ending fund balance remains strong (staff cited a projected ending fund balance of $8,028,499), which gives the commission latitude to amend the budget later if needed. Granham and CFO Pickle said the commission may amend the budget and adopt a tax rate after the state’s certified tax‑rate calculation is complete.

Next steps: the budget ordinance passed first reading unanimously and the commission scheduled a second and final reading on June 3. A separate ordinance adopting a specific tax rate will require its own public hearing and two readings after the Comptroller issues the certified tax rate.