City of Cleveland and Bradley County agree on two-year hold-harmless payments for fire-tax losses after annexation

The Bradley County Commission voted on Sept. 15 to accept a City of Cleveland proposal to prorate the fire tax when properties are annexed and to require the City to make payments to offset lost County fire-tax revenue for two subsequent tax years.

The policy, developed by the City-County Fire Tax Committee, calls for the County Assessor to provide a valuation of the annexed property used to calculate the loss, an immediate partial (amortized) payment for the current tax year, and full payments for the following two years. Cleveland City Manager Joe Fivas presented the proposal to the committee; the County's vote on Sept. 15 approved the committee recommendation by a roll call of 11 in favor and 2 opposed (Commissioners Scott Gilbert and Howard Lewis Thompson).

The committee report and resolution cite Tennessee Code Annotated procedures and the updated urban growth-boundary maps that created the annexation opportunities. The stated goal is to give Bradley County time to adjust to potential revenue shifts while recognizing the potential for longer-term taxable-value increases from new sewer-served development within annexed areas.

Commission language noted the policy will remain in effect as long as the City-County annexation agreement is in force and that payments are tied to the Assessor's original tax valuations. The County Assessor was directed to provide values and a payment schedule to the City.

The measure was placed on the Sept. 15 agenda after the Fire Tax Committee met on Sept. 4 and recommended the approach.