Kingsport records strong property, sales tax collections

The City of Kingsport saw strong property and sales tax collections during 2022, all the while dealing with lingering high inflation, increased costs for personnel and fuel and a challenging labor market.

Kingsport expects to see its tax revenues for the current fiscal year come in significantly higher than what was originally budgeted.

According to city finance officials, Kingsport’s property tax revenues are projected to increase by $2 million (4.77%) by the end of the current fiscal year – June 30, 2023. During that same time, local option sales tax collections are expected to come in $1.46 million (10.6%) over the original budget estimates.

In all, total city revenues for the current fiscal year are expected to be 2.4% higher than the original budget estimates or by approximately $2.26 million.

Kingsport is estimating it will collect $45.1 million in property taxes for the 2023 fiscal year, along with $23.4 million in local option sales taxes. Combined, these two revenue sources account for 71% of the city’s total revenue for the fiscal year.

Budget priorities for the coming fiscal year include sound debt management, increasing city program revenues and implementing the next phase of employee pay plan. At the same time, city finance officials are continuing to be concerned about inflation, the uncertainty of the economy and the competitive labor market.

Several expenditures are also trending higher than the previous year – personnel costs 13.24%, electric bills 23% and equipment repairs and fuel 16%. Total expenditures are projected to be about 99.4% of the budget.

This information was presented to the Board of Mayor and Aldermen during a day-long, strategic planning session held last week (March 20) at city hall. The BMA heard updates from staff on the city’s finances, economic development efforts and budget priorities for the coming year.

To view the presentations from the strategic planning session, please click here.