John W. Cooper, Tellico Villager

The Meaning of “IS” is!

1st School Tax Exemption Appeal - DENIED

By: Pat Hunter

BZA meeting, 06-17-2008


“It depends on what the meaning of the word 'is' is.” Where have we heard that famous quote before? One Villager decided to do just that, parse words, with the Loudon County Board of Zoning Appeals (BZA).


If you are not familiar with the Adequate Facilities Tax for schools, a $1 per sq. ft. tax is levied on new residential development. The new tax was passed shortly after the election of Mayor Doyle Arp and Commission. The tax went into effect Jan. 1, 2007, which was supposed to fund school construction but little tax revenue has been generated from the $1 Million in purported tax revenue. See the bottom of the page to learn why.


Loudon County Planning and Development Director Russ Newman said that the BZA was named as the body to hear appeals, complaints from an aggrieved party about the school Adequate Facilities Tax.


John W. Cooper stepped to the podium by saying that he was the “first one” referring to the first appeals case concerning the AFT. Cooper requested an exemption to the School Facility Privilege Tax. The residential property is located at 223 Chickasaw, in Tommotley Coves in Tellico Village.


Public records indicate that Cooper’s building permit fee was $1,120 with an additional outstanding amount of $3,039 for the School Adequate Facilities Tax.


According to public records, Cooper built 7001 sq. ft. structure and 3,039 was heated area. But, he argued that the 3,039 sq. ft. unfinished basement was not heated or cooled. Cooper distributed additional documents and read from the County Powers Relief Act and Tennessee state statutes.



Cooper commented that the County could levy a tax based on floor area of development. He described “Floor area” means the total of the gross horizontal area of all floors, including basement, cellar, or attic, VIDEO CLIP that is heated and air conditioned living space.”  He argued that the area was not heated or cooled. It’s unfinished but that he had rough in heat and air duct work and that’s all he did. He couldn’t understand why he was being taxed for an area that was not heated. Cooper said that he could not sell it as conditioned living area and the county could not assess it as a finished area. It was on a concrete floor. He asked that the BZA interpret the statutes that were passed with the Adequate Facilities Tax by Loudon County Commission.  



VIDEO CLIP Codes and Building Inspector Bill Cox was next to speak and he commented that he was not the administrator of the tax but that Estelle Herron, Trustee was in charge of collecting the schools AFT and Herron had given him authority to speak for her. He and Herron speak about issues of the tax frequently, Cox commented. They had set up a policy from day one. There are unfinished areas in home’s especially basements but if duct work vents in an area that it is considered heated or cooled but if it is not vented then it is not considered heated or cooled. There were unfinished basements all over the county.


VIDEO CLIP BZA board member Martin Brown quizzed Cooper about the heating and air conditioning issue and his basement. At times the back and forth exchange grew loud. But in the end the Villager’s arguments about what “is” is, didn’t seem to pan out and the BZA voted unanimously to deny Copper’s request.

            VIDEO CLIP

According to information obtained from the Loudon County Trustee’s office, John Cooper did not pay the $3,039.00 Adequate Facilities Tax for schools and he has requested an extension.


Schools AFT - Toothless Law


The Tennessee General Assembly reached an agreement with representatives of Realtors and Home Builders Association on the development tax for schools. Loudon County Commissioners contacted former State Representative Russ Johnson, Rep. Dennis Ferguson and Senator Randy McNally requesting support of the bill. When the bill for the Adequate Facilities Tax for Schools was finally passed, state lawmakers included several loopholes, which in essence made the schools tax, a law with no teeth.


The First year of AFT revenues in Loudon County were first projected at $1Million, and then revised to $500,000 and now $250-300K est. yearly.


According to the Building Inspector, the School Adequate Facilities Privilege Tax liability for last month was $51,985. 


More to come about the AFT for schools.