Budget committee restores 10¢ to debt service after debate over tax shift

The Trassel County Budget and Finance Committee on May 4 reviewed a draft fiscal 2026–27 budget that assumes a proposed 10¢ property tax increase and an internal shift of 10¢ from the county debt-service levy into the county general fund.

Chair Amy opened the meeting and told attendees that only committee members would vote during the budget hearings and that budget documents are posted at trasselcountytn.gov. Amy summarized the packet and said the draft assumes a proposed tax rate of $2.20 per $100 of assessed value and that the 10¢ shift is built into the revenue projections.

Several committee members questioned the mechanics and prudence of reallocating 10¢ out of debt service. Commissioner Gulley warned that the change “is robbing from money we have been putting up to pay debt off in the future” and said it would deplete a fund balance intended to retire future obligations. Gulley pressed for detail about whether the larger 101 (general fund) increases were driven by one-time capital purchases or recurring costs such as an insurance spike; the transcript contains his direct concern that the committee should not “deplete 1 that somebody’s gonna have to deal with later on.”

Budget staff explained that the proposed increases reflect a combination of lost grant revenue, higher employee benefit costs and pension/retirement rate increases, and that the commission’s proposal favors expanded insurance benefits (dental and vision for employee-only coverage) rather than a uniform salary COLA. Staff and members discussed per-employee insurance increases; one participant calculated an increase of roughly $2,226 per employee under the proposed premium adjustments.

After discussion, Gulley moved — and Mitch Ford seconded — a motion to restore the 10¢ to the debt-service line (151) and to find the necessary savings elsewhere in the budget rather than drawing down debt reserve. The chair called the committee-only vote and the motion carried. Following the vote, staff recalculated county property-tax revenue totals and reported the committee would need to identify approximately $303,144 in offsetting reductions to balance the budget if the penny is restored to debt service.

Committee members and staff also discussed longer-term debt strategy. The debt schedule reviewed at the meeting shows several items scheduled to pay off during the next several years, and one member urged using fund balance opportunistically to pay down a county portion of the TCES roof loan (the county’s share was described in the packet as roughly $900,000 at a 4.19% rate). Staff clarified loan terms, including a five-year no-call provision on that financing, and noted legal/contractual constraints on partial prepayment and the school’s separate agreed contribution.

The committee directed staff to provide a detailed list of major 101 line items and proposed “big items” that could be reduced when the board next considers the general fund budget; staff promised those documents at an upcoming meeting. The chair said the sheriff’s budget — a large 101 item — will be scheduled for review at the next meeting.

What’s next: staff will provide the requested line-item breakdown and revised revenue figures; the committee will consider the sheriff’s budget and the detailed 101 list at upcoming hearings before finalizing the tax rate and appropriation decisions.