NASHVILLE, Tenn. (WKRN) — Mayor Freddie O’Connell explained that his office is considering tax hikes alongside this year’s appraisal during Friday’s roundtable discussion.
“The combination of inflationary pressure from the past, the cost of living increases within Metro, a new pay plan scenario, and just where we have been with flat revenues that, yeah, we should expect this to be an ordinary appraisal year where we are considering property tax rate adjustment,” explained Nashville Mayor Freddie O’Connell.
“You don’t raise taxes when inflation is high,” expressed Emily Evans, chairwoman of the Committee To Stop Unfair Tax. “You try not to raise taxes.”
Property owners in Davidson County are no stranger to rising property taxes, which significantly increased in 2020.
“It was 34% which was unprecedented,” Evans said.
Taxes could go up again this year, but there is no indication that the mayor plans to ask for an increase as big as 2020.
Despite legislative efforts, Tennessee remains one of just five states with no cap on property tax increases.
According to the Tax Foundation, data from 2021 and 2022 show that Davidson County saw a 13.5% increase in average property taxes, rising from $1,967 to $2,232.
The mayor said it was too early to know how much this year’s property tax could increase but added that possible federal funding cuts could put even more pressure on the budget.
“I think the federal funding scenario is going to be putting a lot of pressure on it,” O’Connell said.
| READ MORE | Latest headlines from Nashville and Davidson County
Evans suggests the potential tax increase could be driven by a slowdown in the number of people moving to Davidson County, with more residents opting to move to surrounding counties.
“It’s sort of like throwing up your hands [and saying] ‘We’ve got inflation,'” Evans expressed. “‘We’ve got to pass that on to our constituents.'”
“The problem is growth has slowed,” Evans continued. “You are seeing some significant discounting in rents, you are seeing a lot of supply in the housing market.”
She argued that it would be unfair to require property owners to pay more when residents’ costs of living are already high.
“I don’t think that there is a high degree of confidence that the budgetary controls are there,” Evans said. “There seems to be an attitude of we are growing, it’s city, where all these wonderful things [happen], and therefore we can continue to tax the population.”
The mayor noted that his office will examine revenue forecasts closely and factor in appraisal data before making any final decisions.
“Even though we may be in an appraisal year, and that is when you see new signature scenarios, I think for us, we are focused on continuity. We are focused on kind of right sizing a pay plan, and ultimately we are focused on seeing what the unified housing strategy recommends as well,” O’Connell concluded.
