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New law means more money for roads and schools

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By Jennifer Caldwell

 

The Campbell County Highway Department has no shortage of paving projects.

And while $125,000 translates into only about a mile and a half of asphalt, every penny helps.

Thanks to the hard work and team effort of Dennis Potter, road superintendent, and his counterparts in surrounding counties, Tennessee will see an increase in the severance tax paid by coal companies for coal that is mined and removed from counties with a coal presence.

According to Potter, legislation that recently passed through the house and senate will allow for a graduated increase in the coal severance tax that will reach its cap in 2013.

Coal companies currently pay 20 cents per ton for coal mined in the county, which is drastically less than the $4 per ton paid just across the state line in Kentucky, according to Potter.

Potter said the coal companies recognized the fact that an increase in the severance tax was long overdue in Tennessee and were willing to cooperate in coming up with an amicable solution.

The bill that is now awaiting the governor’s signature will increase the coal severance tax to 50 cents per ton in 2010, 75 cents per ton in 2011 and $1 per ton by 2013.

“I’m real proud of getting this done. It’s a great way to bring in more money to the county without placing a burden on the county,” Potter said.

With the seemingly constant demand for road improvements, Potter said the additional money will offer some much needed relief.

“The county just doesn’t have the ability to fund anymore paving projects without raising taxes so the additional funds from the coal severance tax is a step in the right direction,” Potter explained.

While Potter is celebrating the additional monies expected for next year’s budget, Dr. Michael Martin, director of schools, is also looking forward to the same boost in funds since revenue generated from the increased severance tax will be divided evenly between the two departments.

“I’m thankful that the bill has finally passed. Because it (the money) involves energy we will likely apply the additional funds to our (the school system’s) utility bills. It’s not a windfall, but it will be helpful in offsetting a cost that continues to rise,” Martin said.

Rodney Carmichael, director of the Tennessee County Highway Association, commended Potter as well as road superintendents from Anderson, Claiborne and Scott counties for their work in arriving at such a compromise with the coal companies.

“Dennis Potter was the mainstay in this deal. He went out and got money for the schools and the highway department,” Carmichael said.

In addition, Carmichael applauded the willingness of the coal companies to reach what he characterized as a “win- win” situation.

“People don’t normally vote to tax themselves, but the fact that these coal companies realized there was a need for change speaks highly of them,” Carmichael said of the negotiations that led to the first increase in the severance tax since 1984.