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The City of Germantown is considering a property tax hike as part of its new fiscal year budget, which takes effect July 1.
Germantown Board of Mayor and Aldermen held a work session on April 28 at City Hall to further discuss the upcoming budget. The Financial Advisory Commission as part of the fiscal year 2026 budget process voted unanimously to recommend a 29-cent rate increase to the Board of Mayor and Aldermen.
The 29-cent adjustment would be added after the newly reduced certified tax rate is established. The certified tax rate is the property tax rate that generates the same property tax revenue in a reappraisal year that was generated in the prior non-reappraisal year. Following Shelby County’s recent property reappraisal, state laws requires the city to roll back its property tax rate to ensure no additional revenue is collected solely due to increased property values.
Adrienne Royals, Germantown’s budget and financial services director, said during the work session that based on this process, Germantown’s current tax rate of $1.8382 per $100 of assessed value will be reduced by $0.3569, resulting in an proposed certified tax rate of $1.4813.
To account for potential reductions in property values due to appeals, the City has proposed an appeals allowance of $0.0355, bringing the certified rate to $1.5168. Following the rollback, the City is also considering a $0.29 increase to support essential services and capital investments, leading to a proposed fiscal year 2026 property tax rate of $1.8068.
In the 2024 fiscal year budget, the city increased its tax rate from $1.6732 per $100 of assessed value to $1.83282. Germantown did not raise its property tax rate in its fiscal year 2025 budget, leaving it at $1.8383 per $100 of assessed valuation.
Officials said property taxes generated in Germantown make up about 55% of the overall general operating revenues.
How will Germantown use funds from the tax increase?
Germantown said the proposed tax hike is designed to maintain operational expenses, allowing the suburb to deliver services without frequent, incremental tax increases.
In addition, the proposed adjustment will help strengthen public safety as 42% of the city’s general fund budget goes toward public safety.
How much would Germantown residents pay after tax increase
If the full 29-cent increase is approved, the owner of a house valued at $300,000 would pay $216 more annually, or $18 monthly.
What is Germantown’s total budget?
The proposed budget is totaled to be $210.5 million across all funds, with $78.7 million allotted to the general fund.
The Germantown Board of Mayor and Aldermen will consider the budget over three readings, scheduled for May 12, June 9 and June 23. The meetings are held in the Council Chambers at City Hall, 1930 S. Germantown Road, starting at 6 p.m.
Corey Davis is the Collierville and Germantown reporter with The Commercial Appeal. He can be reached at Corey.Davis@commercialappeal.com or 901-293-1610.
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