Shelby County commissioners delay tax-rate vote after trustee flags $9.5 million projection gap

Shelby County commissioners on Monday postponed final votes on the county's certified tax rate and the FY2026 operating and capital budgets after the county trustee and finance officials disagreed about revenue assumptions underpinning the proposed plan.

The delay came after Regina Newman, Shelby County trustee, told commissioners the proposed budget counts on an unusually high property-tax collection rate (98%) for FY2026 that she said is not supported by historic billing-collection patterns and would create an estimated $9.5 million shortfall if adopted as-is. Deputy Chief Financial Officer Michael Thompson defended the administration's proposed numbers but agreed to hold items for two weeks so staff and elected officials could reconcile assumptions.

Newman said she provides the administration with a conservative forecast each year and that previous adjustments in collection percentages explain some year-to-year variance. "I can't make up numbers and give them to you guys for the budget and say, 'oh, we can do 99%,'" Newman told the commission. "That is a fantasy," she added, referring to the proposed 98% collection rate for certain tax categories.

Finance and trustee disagreement. Thompson told the commission that his team prepared the certified-rate submittal following the assessor's certified role and that the county had submitted the calculation to the state as usual. He also provided historical receipts during the meeting showing that collections can exceed the earlier forecasts in some years. Newman countered that the county's fiscal reporting uses a different baseline (percent of billed taxes collected) than some of the administration's revenue forecasts and cautioned commissioners against adopting a budget based on optimistic collection assumptions.

What commissioners did. Commissioners voted to move the third-reading ordinance and related budget items (the tax-rate ordinance and the FY2026 operating and capital budgets) to the June 18 committee meeting and the June 23 commission meeting for additional review. Multiple commissioners asked finance and the trustee to confer and present reconciled figures in that intervening time; several said they would support amendments or alternative revenue fixes rather than adopting the proposal immediately.

Why it matters. Commissioners and staff repeatedly flagged the county's fragile fund-balance position and the risk of relying on optimistic revenue assumptions while proposing multi-million-dollar new or increased recurring expenditures (including raises and new program funding). Several members emphasized that if the county overestimates collections, midyear cuts, hiring freezes, or other fiscal adjustments could be required.

What comes next. Finance and the trustee were asked to produce reconciled numbers and a clear schedule showing how the certified tax-rate calculation maps to the FY2026 revenue totals in the ordinance and budget exhibits. Commissioners set subcommittee review dates (June 4 and June 11) and directed staff to prepare item-level analyses for the June 18 committee meeting so commissioners could consider targeted amendments before the full commission vote.

Ending: Commissioners said they prefer to decide the questions with shared, documented assumptions and gave staff two weeks to respond. If the numbers remain inconsistent, the commission will consider specific amendments at the June committee and full meetings rather than approving the budget and rate on the current timeline.