At their June 12 meeting, Walden officials will take their final vote on the town's budget for fiscal year 2019, which begins July 1.
The budget includes a 2-cent property tax increase, taking the rate up from $0.3853 to $0.4053 per $100 of assessed value.
Town Recorder Fern Lockhart said this is the town's first tax increase in the 22 years she has been employed there.
Mayor Bill Trohanis said the proposed increase will help to make up for the money that will be lost with the phase-out of the Hall income tax, a 6 percent tax on investments which Tennessee legislators voted in spring 2016 to decrease by 1 percent each year beginning in mid-2017.
The money the town brings in from the Hall income tax makes up a large portion of its revenues each year - between 40-60 percent, an average of $400,000, with the amount fluctuating based on the economy, Lockhart said.
"It's definitely going to have an impact," said Trohanis, who recommends the town offset the impending loss with a gradual increase in taxes over a period of several years in order to cover necessary expenditures such as paving roads and maintaining the town's infrastructure.
Proposed revenues for FY 2019 budget are $780,125. Proposed expenditures are $812,326. The difference will come out of the general fund balance, which at the end of the last fiscal year was $4,064,037, said Lockhart.
One of the largest expenditures in the upcoming budget is paving, for which the town has budgeted $409,000.
The sole bid received for the approximately 2 miles of paving budgeted for was much higher: $648,548, or 33 percent more than budgeted. Town Attorney Sam Elliott mentioned during Walden's May 8 meeting that other smaller municipalities where he also serves as city attorney bid their paving projects solely by the ton of asphalt, as opposed to by the road and by the ton, as Walden had done.
Lockhart said that since Walden doesn't have the equipment to prep the roads for putting down asphalt, the town has to pay for the preparation of the roads in addition to the tonnage of asphalt, which is why its bids for paving are higher than other towns that own their own equipment.
Since anything with a cost greater than $10,000 must be put out for bid, town officials will need to rebid the project if they choose not to accept the current bid.
Town officials' next meeting will be held at Walden Town Hall Tuesday, June 12 at 6:30 p.m.