Jefferson County Debt Per Capita Well Exceeds National Benchmark

Decisions On More Debt On Horizon

Jefferson County’s current outstanding debt is nearly $83 million dollars, according to information provided by Jefferson County Finance Director Helton and the County’s outside Financial Advisor, Scott Gibson of Cumberland Securities. Payments from the Debt Service account are expected to be slightly more than $7 in 2015 but will take a leap to the $8 million dollar mark in 2016 before dropping again to the 2014 number where they will stay for about seven years. Gibson charted the current debt payments by year and the year 2024 looks to be significant for Jefferson County. In 2024, the annual debt payments will drop from over $7 million per year to around $4.2 million annually and they will take another significant drop in 2029, when the outstanding debt service will be around the $2 million dollar mark.

Gibson and Helton addressed the Jefferson County Commission during their work session last week, in regard to financing the County’s $5 million dollar cash commitment to the renovation at Jefferson County High School, which was a part of the approximately $25 million dollar renovation package that was approved last year. In addition to the $5 million dollar cash contribution, Gibson and Helton have suggested borrowing another $3 million dollars for renovations to Jefferson County High School’s Building 8, for a total of $8 million dollars. Should the County Commission decide to forgo the use of fund balance and take out a loan for those projects, the impact to annual debt payment would be run in the neighborhood of $500,000 per year, with some movement from year to year. According to Helton, should the County Commission decide to borrow the suggested $8 million dollars, the County debt would be almost $91 million dollars. For comparison, Jefferson County’s debt per capital ratio, meaning the amount of County debt divided by residents, is currently almost $1,600 per resident. Should the County increase the debt to $90,986,031 the debt per capita would be around $1744. Both numbers are well above the National Benchmark of $1200 and significantly higher than neighboring Hamblen County’s $575 debt per capita. The issue is expected to be addressed shortly by the County Commission, as they were informed that the $5 million dollars in committed funds for the renovation to JCHS proper will be needed in the near future.

Source: Decisions On More Debt On Horizon