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City explains corrected certified tax rate and estimates FY26 shortfall of about $762,286
Summary
Finance staff said an earlier error set the certified tax rate incorrectly; the corrected certified tax rate of $1.1306 per $100 of assessed value restores the rate intended to produce budgeted property tax revenue and leaves an estimated FY26 shortfall of about $762,286 to be managed through fund balance and internal budget adjustments.
Finance staff presented a corrected certified tax rate ordinance (Ordinance No. 25‑12‑95) after discovering the originally certified rate was set in error at 0.8968. The corrected certified tax rate is $1.1306 per $100 of assessed value — the rate staff say was intended to produce the budgeted property tax revenue of $5,512,500 for FY26.
Staff explained Tennessee municipalities undergo property reappraisal every four years and that the error in the certified rate could not be corrected after tax bills were mailed. The mistake created an estimated revenue shortfall of approximately $762,286 for FY26. Finance staff told commissioners the correction mainly updates documentation and that the city will not be able to collect the marginal difference for bills already issued this year.
To manage the shortfall, staff described internal “belt‑tightening” measures, including delaying some capital projects, deferring nonessential midyear personnel changes and using fund balance where necessary. Staff said they will return in January with a fuller plan for targeted departmental budget actions; they emphasized the city remains financially healthy and not at risk of missing payments.
A public hearing on the corrected rate will be held in the regular meeting, and the ordinance is slated to amend prior inconsistent ordinances establishing the general revenue tax rate.
