Tuesday night, the Cabarrus County Board of Commissioners raised the ad valorem property tax rate from 0.53 cents on the $100 valuation to a rate of 0.63 cents on the $100 valuation. It’s important to keep in mind what led to this tax increase. But first, a few words from Harold Smith.
June 14, 2005:County Commissioners Approve 19% Property Tax Increase
Commissioners Carpenter, Carruth and Juba spit in the face of taxpayers tonight as they voted to increase our property taxes by 19%. Your new tax rate is $.63 up from $.53. The budget public hearing was a sham. Commissioners Carpenter, Carruth and Juba had already made their decision to increase taxes. Chairman Carpenter, Carruth and Juba did not care about what a 19% tax increase would do to Cabarrus citizens. The 19% tax increase is on top of a 20% tax increase last year. What has the taxpayers got for 39% tax increase? Commissioners Privette and Freemen voted against the 19% tax increase. An earlier motion by Privette and seconded by Freeman to keep the tax rate the same was defeated by Carpenter, Carruth and Juba.
The response to my email to sign a petition opposing the 19% tax increase was overwhelmingly opposed to the tax increase. I receive 338 responses from you opposing the tax increase. I only received one email supporting the tax increase. I suspect that this opposition is only the tip of the iceberg. We will continue to voice our opposition against this tax increase. Chairman Carpenter will be up for re-election in 2006. She will be held accountable for the largest tax increase of any county in NC.
First, 338 people visited the Harold Smith website in the first thirteen days in June? That’s surprising. Second, no, I didn’t respond pro or con. Third, Carolyn Carpenter should be the last person responsible for this tax increase.
It might seem a bit counter-intuitive not to blame the sitting Chair for a tax-increase; but once one looks at the facts it becomes apparent as to what happened. To get the full perspective, one must go to 1998. In 1998, County commissioners proposed a plan to move away from borrowing money for schools (as the county was successful in a school bond referendum in 1996) and fund a capital fund to meet construction needs by increasing the sales tax and instituting a property transfer tax. The Cabarrus Taxpayers’ association opposed this. The supporters of the sales tax and transfer tax made some bad political moves: instituting this move on an off-year, asking for a special election in February, and not gaining ANY political support from homebuilders and realtors. The Cabarrus Taxpayers’ Association stated in a widely-distributed flyer the following:
- $69 million worth of school construction would satisfy Cabarrus County’s school construction needs through 2010.
- The tax revenue from at outlet mall (Concord Mills) would be able to fund all new construction once it is finished.
- The county had enough remaining funds to build 2 new schools with cash.
The anger created from the election and “facts” stated in this flyer helped to propel Cabarrus Taxpayers’ Association candidates into office, including current Commissioner Coy Privette.
What happened after that is interesting, and looking at it through the prism of the statements on this flyer is quite interesting:
- CTA Statement: $69 million worth of school construction would satisfy Cabarrus County’s school construction needs through 2010. Fact: Coy Privette joined in the approval more than $110 million dollars worth of debt without taxpayers’ consent largely for school construction. $69 million would not be enough construction to keep the schools from being overcrowded now, much less until 2010.
- CTA Statement: The tax revenue from at outlet mall (Concord Mills) would be able to fund all new construction once it is finished. Fact: Concord Mills still enjoys property tax incentives which leaves it largely exempt from paying property taxes.
- CTA Statement: The county had enough remaining funds to build 2 new schools with cash. Fact: Those funds were not used to build new schools, but to balance budgets that were driven into deficit by CTA-controlled County Commissions from 1999-2004.
In fact, the County is paying twice as much in debt service as it did five years ago, even though the County budget hasn’t doubled. Also, the level of savings has dropped significantly. This is because during the period FY2001 to FY2005, the County spent more money than it brought in every year. Cabarrus County used savings to balance the budget, depleting the cash that was on hand before the CTA took control of the Cabarrus County Board of Commissioners.
So, now that the savings are depleted to less than the recommended 15% of annual expenditures, the county is saddled with mounting debt, and the revenues will hardly cover the mandatory expenses, much less “extras” like libraries, parks, and veterans services, the sitting County Commissioners had little choice but to raise the tax rate.
Why would someone do this? Well, Harold Smith’s rhetoric from an earlier post might give us a clue:
June 12, 2005: Public Outrage - 19% Tax Increase
Cabarrus County Budget Public Hearing - June 23, 2005
Tell the County Commissioners “NO” to 19% Property Tax Rate Increase:
The Commissioners are split 3-2 in favor of a 19% property tax rate increase recommended by John Day, County Manager. Commissioners Privette and Freeman oppose this 19% property tax rate increase. Only a strong outrage by the public can change the outcome. Do we need an another “Boston Tea Party” and call it the “Cabarrus Tea Party.
Every Tax Increase Steals Buying Power from Citizens and Puts Businesses at More of a Competitive Disadvantage.
Tax increase causes citizens to have less money for medicine, food, gas, clothing, housing, college education and other necessities of daily living. Tax increase causes businesses to be less competitive in global markets. Look at what has happened to Pillowtex and the textile industry. The same is happening in the furniture industry and the automobile industries. Numerous furniture companies are closing in High Point and Hickory. GM just announced 25,000 layoffs. We are losing high paying jobs in manufacturing and replacing them with low paying jobs in the service industries such as retail stores and restaurants. Look around in Cabarrus County at the jobs being created (Retail and Restaurants).
John Day, County Manager, needs help to balance a budget without increasing taxes on the citizens and businesses.
I am speaking from experience and I know what I am talking about. John needs help. Has he ever been a County Manager before? I am enjoying retirement, but I will be happy to work with John at minimum wage to recommend and present a balanced budget without increasing taxes. I have been the chief financial officer for two publicly owned companies (one listed on the NY Stock Exchange and one listed on the American Stock Exchange. I have balanced budgets for 40 years in competitive environments. I never had the option of taxing the public to make up for my inability to balance a budget. The County needs help to manage its budget, to cut out wasteful spending, to hold county employees accountable for results, to build compensation programs that rewards productivity and efficiencies and to eliminate the “old buddy” systems that fosters “scratch my back and IÃ?’ll scratch yours.”
It is time for a public outrage over a 19% property tax increase after an approximately 20% average tax increase last year due to property re-evaluation. Harold Smith (A Fighting Taxpayer and Voter)
Funny how he doesn’t mention all of the debt taken on by Cabarrus County when his friends ran the show. We simply can’t afford his help - even with his generous offer of minimum wage. Why wasn’t he offering up his help over the past for years when the budget was in deficit? The Cabarrus Taxpayers’ Association is playing politics, pure and simple. While “growth” may lead to more revenue, it does not necessarily lead to more “income”. The accoutrements of growth (sewers, schools, roads, etc.) have a large capital cost which must be amortorized over time. In any situation, when a government decides to accommodate growth they have two choices: save in anticipation or borrow in desipriation. The pre-CTA County Commissions and the current one take the former approach, which is fiscally more painful now but cheaper in the long run. However, the CTA, inspite of their “anti-debt” rhetoric placed commissioners who apparently spent what was saved in anticipation, but borrowed in despiration.
When these practices came to light, and they lost the fight to keep the school bond off of the ballot in 2004, they had the audacity to produce an error-ridden flyer ala 1998. This time, the voters wised up and voted overwhelmingly insupport of the school bond.
Here’s the bottom line. Coy Privette, Richard Suggs, and the rest of the CTA-backed gang raised my taxes long before Carolyn Carpenter ever put this up for a vote. I’m 27 and plan on being a resident of Cabarrus County for some time; and I’ll get the prividledge to paying off debt that, for the most part, I had little say in acquiring. We finally have a Board of Commissioners who are looking in anticipation of future needs, will help limit borrowing, and keep more of the tax revenue in Cabarrus County and not in the pockets of financiers. This should be remembered in the next year.
In 2006, the choice will be simple. Are you going to kick out the person who gave you the medicine (Carolyn Carpenter) or the people who gave you the disease (Richard Suggs, Coy Privette, and Robert Freeman)?
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1 The View From The Cheap Seats » Updated: The Anatomy of the Cabarrus Youth Tax // Apr 23, 2007 at 11:02 pm
[...] In 1998, a proposal was on the ballot with a 1% land transfer tax and an increase in the sales tax. This measure was soundly defeated. This defeat came partly from efforts by the now-defunct Cabarrus Taxpayers’ Association. In an earlier post, I covered how this entire ad was hogwash. CLICK TO READ ANALYSIS Coy Privette and Richard Suggs were both active in the Cabarrus Taxpayers’ Association at the time. [...]