Council members debate how to fund Memphis City Schools - WMC Action News 5 - Memphis, Tennessee

Council members debate how to fund Memphis City Schools

By Kontji Anthony - bio | email

MEMPHIS, TN (WMC-TV) - Debate turned to outrage Tuesday as Memphis City Council members considered how to fund Memphis City Schools.

The council and the school system are in a dispute over $54 million.  During the council's executive session Tuesday, the attorney Allan Wade submitted four options to come up with the money.

  1. A 46-cent school tax
  2. The 31 cent school tax + $16 million in reserves
  3. The 46 cent school tax + debt reduction, which means the city would collect money from the tax as partial payback of MCS's debt
  4. The 31 cent school tax + $16 million in reserves, plus the debt reduction

The options drew heavy criticism from one very vocal councilman. Reid Hedgepeth demanded Memphis Mayor AC Wharton be present for school funding talks.

"This is a very serious issue that I think he needs to be here for," Hedgepeth said.

Wharton was in Washington Tuesday to bid for federal funds, but Hedgepeth knew the mayor had met with his staff and Council Chairman Harold Collins.
    
"What option does the mayor want?" he asked.

No one answered, and the topic changed.

"The plan going forward is that we go to single-source funding and all the school funding goes to the county," Collins said.

Hedgepeth pressed.

"Can somebody please answer my questions?" he asked. "What does Mayor AC Wharton want to do?  Options 1,2,3 or 4?"

Wharton's staff stayed mum, so Collins finally answered.

"He and I discussed Option 2 on the docket," Collins said. "Sixteen million in reserve. We issue a special school tax for 31 cents."

The money Memphis City Schools pays back to the city would serve as a future tax refund to the citizens.  Hedgepeth wasn't satisfied.
    
"I think first we need to look in our budget before we start handing them a 31 cent tax increase," he said. "Secondly, we need to look at any options the school owes us before we give a 31 cent tax increase.  And third, we need to look at our reserve funds."

Hedgepeth said it is not time for a tax hike.
    
"The worst economic times, and we're asking our citizens for a 31 cent tax increase," he remarked.

Council members ultimately decided to hold special budget hearings beginning Wednesday.  Wharton is scheduled to be back from Washington by then. 


Options presented to the Memphis City Council:

1. School Tax

  • 46-cent tax increase on each $100 of assessed value
  • MCS nets $50.5M

2. School Tax + Reserves

  • 31-cent tax increase on each $100 of assessed value + $16M in reserves
  • MCS nets $34.5M

3. School Tax + Debt Reduction

  • 46-cent tax on each $100 of assessed value, but city collects from that tax 1-cent for every $1,050,00 MCS owes the city
  • MCS nets $0
     

4. School Tax + Reserves + Debt reduction

  • 31-cent tax increase on each $100 of assessed value + $16M in reserves, but city collects from that tax 1-cent for every $1,050,00 MCS owes the city
  • MCS nets $16M

 


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