By Angie Mayes
Special to Mt. Juliet News
A letter that was signed Wilson County Republican Party and sent by Wilson County Republican Party Executive Committee member Terri Nicholson to Wilson County Mayor Randall Hutto, county commissioners and The Lebanon Democrat claimed the funding of a mailer is illegal, according to a state attorney general’s opinion, along with other inaccuracies regarding the proposed sales tax increase currently on the Nov. 6 ballot.
County officials said the mailer was designed to “educate” the public about the sales tax referendum. There’s also some confusion within the Republican Party as to how and why the letter was sent in the first place.
In its entirety, the letter said, “Our county commission voted to have a sales tax referendum put on the November ballot with an understanding that an estimated $5.2 million would go into the special purpose fund for school construction. This did not occur as planned.
“The sales tax increase, 9.25 percent to 9.75 percent, will now go into the special purpose fund, debt service and the general-purpose school fund. The county attorney [Mike Jennings] has a conflict of interest, should he protect the school board or the county. The commission vote was complete, and he failed to mention the original intent of the sales tax would not come to fruition. The school board has since passed a resolution, which was written by our county attorney, to accept the funds and will be allowed to spend at their discretion. Currently, the tax is dispersed as general purpose 59 percent, debt service 6 percent and special purpose 34 percent.
“We are threatened with a property tax increase if we do not approve the sales tax increase. The choice before us is obvious. Property tax bills under $10,000 are deductible from federal income tax. Sales taxes are no longer deductible from federal income taxes. There is no clarification to the public, which discusses the 1-3-year school budget presented at $345.8 million with a possible deduction of $110 million for Green Hill High School. Given the finances presented thus far, a $245.8 million bond with a sales tax increase of $5.2 million cannot be financed without extra revenue such as a property tax increase, unless you are not making principle payments.
“Our finance director [Aaron Maynard] informed us that the county should be solvent, and there would not be a property tax increase in the near future. However, there is not a release of any data to support any type of forecasting.
“In researching surrounding counties, we discovered that Williamson County’s attorney assisted their mayor with a state statute and was able to have their board of education forego any operating expenses and allowed the funds to be allocated directly to school construction. The Franklin Special School District also agreed and assisted along with them and all the cities except Fairview gave up the added revenue for the county’s capitol need for three years. It is our understanding that we need six.
“To further complicate the matter, our county commission and school board have approved $70,000 to lobby in favor of the sales tax referendum, which will be spearheaded by Mayor Hutto and the Director of Schools Donna Wright. As we understand, these approvals are illegal [because of an opinion by the state attorney general]. We request immediate rescission of these illegal approvals and insist that the illegal activities cease.”
In an explanation as to how the additional revenue would be spent, Jennings referred to the wording on the ballot, which said “all funds from the total increase to be deposited into the special purpose tax fund for school construction, debt service and other educational expenditures. He said to clarify, other educational expenditures include those related to construction costs such as bond issuer fees, underwriter fees, closing costs, different types of testing from engineers, professionals, design fees, architect fees, etc.
Wilson County finance director Aaron Maynard also disputed the claims.
“None of the monies is going into the general fund or the debt service fund. All of it, 100 percent, is going to the special purpose tax fund,” Maynard said.
First, Maynard clarified the tax law.
“Here’s the thing,” he said. “Under the new tax law, everybody’s standard deduction is going to double. You’ll have to have a lot of mortgage interest, charitable donations and things like that to meet the new $24,000 family deduction. There will be fewer people itemizing their taxes.
“I would deny that we threatened a property tax. We have said it was an alternative if we don’t get the sales tax. When the next project is undertaken, we have two options. We will look for an increase in the adequate facilities tax or a property tax. But, we have not threatened in any way.”
Wilson County Deputy Director of Schools Mickey Hall said the information regarding the “1-3-year school budget” wasn’t a budget at all but came from Wilson County Schools’ capital outlay plan, and the amounts referenced weren’t budgeted money, rather they are costs involved to either build new or renovate existing schools.
Maynard said if the sales tax referendum doesn’t pass, the county has other options, put a wheel tax referendum on the ballot or raise the property tax or adequate facilities tax or a combination of the three.
“The bottom line is the county commissioners have to make choices of what is left. If the sales tax fails, I doubt they will put the wheel tax on a referendum anytime soon,” Maynard said.
“I have not said to people that if the sales tax issue doesn’t pass then we’ll have a property tax increase in X number of years. I’m not going to be put on the spot. I don’t know how long it will be, and I will not promise there will not be a property tax increase. If the referendum does pass, then that would minimize any potential property tax increase in the future. But I can’t tell you how many years down the road that would be. I can’t see three years into the future.”
The attorney general’s opinion said, “No state statute specifically authorizes the use of funds for this purpose. Absent such specific authorization, neither a county commission nor a county mayor may use county funds to pay for communications that advocate for or against adoption of a measure in a local referendum.”
Maynard said the key word in the opinion is “advocate.”
“We cannot use county funds to advocate,” he said. “But there’s nothing to say we can’t use funds to educate. Nothing on our materials says to vote yes. Our materials give an explanation in terms of population growth and school growth, and the fact that’s why there is a referendum. Nothing says go vote, ‘yes.’ That would be against the law and lobbying. I deny completely and vehemently that there is any lobbying whatsoever. When I do my talks about the referendum, I always open with, ‘I’m not here to sell you on a sales tax or advocate for one. I only want you to go in the booth and make an informed decision.’”
Jennings said, “[State law] allows counties to contract ‘for legal services, fiscal agent, financial advisor or advisory services, educational consultant services and similar services by professional persons or groups of high ethical standards’ and they ‘shall not be based upon competitive solicitations but shall be awarded on the basis of recognized competence and integrity.’ If the group providing this assistance to Wilson County meets the definition of ‘similar services’ [usually on a case-by-case basis], then competitive solicitation is not required.
“With regard to the AG opinion, while the AG finds no statute on point, please note [that the AG’s analysis of the issue refers to] the 1989 Florida case, which the AG who authored this opinion says stands for the proposition that ‘a county can only use tax dollars to fairly educate the public on a referendum, and cannot use such funds to pick up the gauntlet and enter the fray.’
“I have heard both the mayor and finance director say the purpose of this money being spent is to ‘educate the public.’ While a Florida decision is not binding authority in Tennessee, it is persuasive authority. And, it seems to be the only case law specifically addressing this issue. However, I have not yet read the case, nor have I done any independent research on the AG opinion. I relied on the language of that AG opinion.”
Jennings also said, “Tennessee law does not currently explicitly authorize a county commission or a county mayor to use county funds to pay for communications that advocate for or against adoption of a measure in a local referendum. If we are not advocating for or against the referendum, then this AG’s opinion does not directly answer the issue raised.”
Nicholson said she and GOP Executive Committee member Tom Hoffman were asked to write the letter by the leaders of the local party.
“This isn’t something we came up with on our own,” Nicholson said. “I listened to the county commission and heard what they were saying.”
Wilson County Republican Party chairman Alex Stillwell said the local GOP didn’t authorize the letter.
“The letter was not authorized or an official release from the Republican Party,” Stillwell said. “This subject had been discussed in several circles within the party, including the executive committee. The Republican Party didn’t authorize it.”
Nicholson also said she received the 1-3-year capital outlay plan from Hall, but Hall said he had not spoken to Nicholson.
“None of our information in the letter was false,” Nicholson said. “It came directly from the director of finance. The reason it’s going around now is that they are focusing on the party and what we have done and are forgetting the serious issues with the sales tax. This has nothing to do with who said what. This is an effort to inform the public on an issue that impacts every person in the county.”
Despite Stillwell’s denouncement of the letter, he maintained the Wilson County Republican Party’s stance against the proposed sales tax increase.
“As conservatives, many Republicans have issues with raising the sales tax or any tax, Stillwell said. “The sales tax referendum outlined in the taxpayer paid-for advertising suggests that if the voters approve the sales tax increase, property taxes will not be increased. This claim should be verified.
“The supporting analysis of the sales tax increase contains some apparent fuzzy math regarding where the incremental collected tax will be spent, what type and amount of debt service will the proceeds be used for, and last but not least, there are no provisions requiring more prudent reduced spending on school expansion and other areas.
“The Republican Party of Wilson County urges voters from all parties to do your homework and research the ramifications of passing the sales tax referendum. Please do not rely on just the county’s flyers.”
Editor Jared Felkins contributed to this report.