By MIKE KRAFCIK6 News Reporter
JELLICO (WATE) - A budget for the city of Jellico was passed Monday night, just hours before a deadline given by the state comptroller's office.
In a letter sent in June to the Jellico Board of Mayor and Aldermen, Tennessee Comptroller Justin Wilson threatened to pass a budget and levy a tax if Jellico's leaders didn't by Monday.
Jellico has battled financial problems since last fall. At one point, city employees did not get paychecks on time because. City officials said there was no money to pay them.
The $1.3 million budget was adopted by a 4-1 vote during a special session Monday night. The budget contains no tax increase.
When board members initially approved the budget on first reading it included a 50 cent property tax increase.
Councilman Alvin Evans proposed a last minute amendment during Monday's meeting to remove the tax increase.
Officials expected the tax increase would generate around $91,000 in additional revenue next year, cutting some of the $160,000 revenue shortfall.
Mayor Les Stiers says many revenue streams have dropped. The wholesale beer tax has declined dramatically because surrounding cities such as Corbin and Williamsburg in Kentucky now sell packaged beer.
The mayor argues this budget won't help the city in the long-run because, in his opinion, council members have been unable to help generate revenue the city needs.
"The revenue side still is not being addressed. You know, it's just the fact about this council. Until they do that, we're going to have continuing shortfalls in Jellico," said Mayor Stiers.
To generate more revenue, people will also pay court costs on all tickets and citations, which officials say could generate more than $300,000.
The approved budget also means city workers will pay half of their health insurance premiums.
Right now, the city pays 100 percent of health insurance costs. Mayor Stiers says that will save around $60,000 a year for the 20 city full-time city employees eligible for health insurance.
Despite the approval of the budget, Stiers will still have to meet with the comptroller's office Tuesday in Nashville.
Council members could still propose a tax increase within the next 90 days or before October 1.
1306 N. Broadway NE Knoxville, Tennessee 37917