Concern: Growth is negative

Franklin's Approach: Growth brings valuable investments and helps keep property taxes low. Thanks to increased sales tax revenue from expanding commercial areas, Franklin relies less on property taxes, benefiting residents with lower tax rates for high-quality City services.

Sales and Property Taxes

Growth in the community over the last several generations has fueled significant increases in all tax collections. This is not surprising – as the population grows, additional investment is made in the community, more goods and services are provided, and both the sales and property values grow. Unique to Franklin’s deliberate and balanced approach to the development of commercial and office cores and distinct residential areas has been a sizeable increase in sales tax collections. Since the opening of the Cool Springs Galleria Mall in the early 1990’s, sales tax revenues have steadily increased and outpaced property tax revenues (Figure Q shows the last 10 years of total Local Sales Tax collections vs. Property Tax collections).

Figure Q.

As a result of strong, consistent growth in sales tax collections, City of Franklin services are financed far more by sales tax than property tax – unusual for most cities in Tennessee and in America who primarily rely on local property taxes to fund operations and capital investments. Figure R shows overall financing of General Fund Operations in FY 2025. 76% comes from consumption taxes (local sales, state shared sales, alcohol taxes), while only 12% of the budget comes from taxes of wealth & assets (property taxes).

Figure R.

 A byproduct of the sustained growth in sales tax has been the stability, or steady reduction, of the property tax rate. Under Tennessee law, at the time of reappraisal (every four to six years), if property values increase since the last re-appraisal (which they have in Franklin every time in the last 40 years), local governments must reduce the tax rate to ensure that the City does not collect more in taxes than the year prior. (The Board of Mayor and Alderman must set the tax rate annually, and can elect to set a higher rate, but first must acknowledge the property tax rate reduction.) In Franklin, the property tax rate has steadily decreased over the last 40 years. Effective FY 2025, the certified tax rate is 32.61 cents per $100 of assessed value (the lowest rate for Tennessee municipalities with a population of 50,000 or greater). 

Figure S.

Franklin’s future is full of promise, driven by our thoughtful approach to growth and preservation. As we continue to expand and evolve, we remain dedicated to creating a city that celebrates its heritage while embracing new opportunities. 

Thank you for being a vital part of our community. Together, we’re building a bright and beautiful future for Franklin!