Citizens for Schools and Parks Meeting

Date: 

Wednesday, March 26, 2008 - 3:30pm

Location: 

Carrboro Town Hall in Room 100
Next week we will be organizing a committee to be called Citizens for Schools and Parks to advocate for passing the real estate transfer tax in Orange County.  This group will be ad-hoc and will dissolve after this May's vote on the issue.
 
If you are concerned about school, park and open space funding in Orange County and want to help pass this referendum, then please come to this meeting.  If you cannot come, then please email Mark_Chilton@hotmail.com to let us know how you can help.

Comments

It saddens me to see erstwhile "progressives" adopting polarizing spin tactics to force this issue without reasonable dialogue on other options.  By calling a group pushing for the tax Citizens for Parks and Schools, it makes it sound like anyone opposed to the tax is against parks, schools, children, kittens, butterflies, apple pie and puppies. The reality is that the issue is not black and white, and in Orange, alternatives have not even been seriously considered. I question that.

Taxes are going up, one way or the other. I think most folks understand and even accept that at some level. But, the question should be what mechanism does the most good with the least negative consequences. Is the land transfer tax increase the best solution? The answer is we don't know, because narrow special interest groups on both sides are essentially stifling debate. Why?

The land transfer tax was soundly defeated in 16 of 16 NC counties where it was voted on last year. Why? And, why are Orange officials so interested in only considering this one tool? There are plenty of other mechanisms such as across the board property tax increases (which might actually cause folks to seriously question how the money is being spent), increased sales tax, or a truly progressive tiered imperveous surface tax increase that might serve the same goals while also achieving other goals. Is the land transfer tax increase really the best possible tool for the job?

 It may well be, but it hasn't been discussed openly enough for most of us to really feel like we even know the answer. Bands of Carrborians and Chapel Hillians spinning the issue doesn't really help, any more than it helps to have realtors groups spinning the issue in the opposite direction.  

Then there's the question of where the money will actually wind up going, and how it will be allocated. I'll take a wild guess based on previous experience and boldly predict that Efland, Mebane, Cedar Grove and Hurdle Mills areas of Orange County, where median home values are frequently less than half of what they are in CH and Carrboro, will not even get their fair share of this pie. The wealthier parts of the county will be made a little bit nicer, and the poorer components,  will remain largely forgotten and underfunded.

If we're going to be forcefed this particular tax, is there at least a mechanism to insure that monies generated will stay in the township that they originated in? That won't solve the inequity, since house prices are so disparate, but at least it would seem a little bit fairer.

I do care about school quality, but have not yet decided one way or the other about the transfer tax. I do know that I prefer it over an increase in the ad valorem tax or the sales tax, but as with so many other issues, it seems like a solution in need of a good problem description.

SAPFO was established to synchronize the timing of new development and new school facilities. Reading this original ordinance, it is clear that the intent was to link infrastructure and growth. A later amendment to the ordinance gave the two school districts the authority to stop development in the absence of sufficient space in existing schools OR funding to building additional schools.

My observation is that the school districts are extremely reticient to withhold a certificate from a new developer and that the BoCC feels compelled to provide funding to support new schools even at the detriment of other county needs. That may not be an accurate summary of the problem, since I am an outsider to the process. But I would really appreciate it if the group responsible for managing the county's education campaign, or individuals/groups in support of the new tax, would help us all see the bigger picture rather than simply saying we have to have a new taxing mechanism.

My understanding has always been that it is much easier to sell a bond/tax issue to the public if you can clearly explain what the additional revenue will do/buy? I might have missed it but have the County Commissioners specified where the transfer tax would go? Would it be committed to schools & parks or would it go into a general revenue fund?

County staff recommended 60% of the funds be used for schools and 40% for parks. The BoCC seems to agree with that general sentiment, at least inasmuch as that it not get lumped in with the general fund. However, as I learned at the public education forum Thursday night from UNC SOG professor Kara Milonzi, the board can't bind the funds in any way that would restrict future boards the ability to use them otherwise.

You might be interested in the following: http://www.co.orange.nc.us/OCCLERKS/0803183b.pdf

The other fact that we learned on Thursday night is that the state will take over paying what the county has been paying toward Medicaid. If I understood this correctly, the county should have, at least, an additional $500,000 in their budget once that happens. Will that $500,000 also be split between school and parks?

The transfer tax or a new sales tax are each expected to generate about $3.5 million. 60% of $3.5m is $2.1m. If 60% of that goes to CHCCS, they can expect to receive an extra $1,260,000 annually. The estimated cost of elementary school #11 is $31 million, and then there is a need for a new middle school. Even with the $500,00, neither the transfer tax or the sales tax are going to go far in meeting the needs for new schools.

Well, bear in mind that the new elementary school is a one-time cost, whereas the new funds will be annual.  Also, there will be annual costs for staffing and maintenance etc.

The Medicaid changes that happened in the same bill are beside the point.  That change is done and even if it frees up some county tax revenue, it does little to mitigate the need for additional revenue sources.

Regardless, the $3 Million from the transfer tax is going to be $3 Million less we have to pay in our property tax bills.  That's the real point.

Mark Zimmerman had a column in this morning's CHN, "Paying for sustainability." It's well worth reading, as Mark, a businessman with experience in our community, raises some questions that really need answers.

In Orange County, we export money. We have more wealth and spend more of it than our neighbors, but more than half of our spending is done across our borders. We export jobs. Every day 42 percent of us get into our cars and drive somewhere else to earn our living. Private sector jobs actually declined in five of six years since 2000.

Without jobs and shopping, Orange County exports tax revenue. Orange County residents contribute nearly $12 million of sales tax to our neighbors' schools and parks. Our commercial tax base is anemic, providing a mere 14 percent of our property tax. To make up for those missing revenues, the burden on residential property owners rises year after year.

Mark Zimmerman also supports a sales tax over the transfer tax. Isn't it somewhat disingenuous to claim we export our taxes and then turn around and support the taxing mechanism that sends those revenues to our neighbors?

Mark wrote in the Carrboro Citizen (Friday, March 21st, 2008 )that:
The transfer tax is a regressive tax that will disproportionately impact lower-income homeowners, place an unnecessary burden on affordable housing and nonprofit organizations and unfairly concentrate our taxes on a minority of our fellow citizens. The way it works is that when you sell your home or some land, Orange County will take 0.4 percent of your selling price before giving you the rest of your proceeds.
Do we need other alternatives to consider?

Technically, a regressive tax is one in which the rate decreases as the amount being taxed increases. The transfer tax is a flat tax since everyone pays the same percentage. It may disportionately impact lower-income homeowners and do all the other things Mr Zimmerman forecasts, but why isn't he calling for reform of the real estate industry if he cares so much about this? Realtors take a 6% commission before the seller gets the rest of the proceeds. That's a much larger impact than 0.4%.

I'd support the transfer tax enthusiastically if it were being applied to buyers, since those are the individuals causing the need for new infrastructure. But that isn't a possibility, thanks to the legislature. As I understood it on Thursday night, the transfer tax is the only viable alternative. Anything more creative would require enabling legislation.

The one thing I do agree with Mr. Zimmerman about is that we need commercial development and we need it now, not tomorrow.

I've repeatedly heard some people say that we need to increase our non-residential tax base in CH but I haven't heard many solutions offered. When medium-to-large-sized stores show an interest in locating in CH neighbors turn out to express their opposition. When developers propose large office complexes neighbors turn out to express their opposition. When developers propose large condominium projects neighbors express their opposition.

I don't personally disagree with Mark Zimmerman's column but he may be wrong in thinking that Chapel Hill citizens are uncomfortable with their current situation. Yes, it means higher taxes but perhaps the majority of citizens are willing to accept that rather than some of the alternatives.

I guess when you boil it all down, it becomes a question of whether we let those who can continue to pay ever-increasing taxes determine the policies that others citizens will have to struggle with to afford. 

As our four levels of government taxes don't seem to decrease and incomes don't always keep pace, something has to give.  What will it be, a community where it's very clear as to who can afford to live here?

>What will it be, a community where it's very clear as to who can afford to live here?

 Fred, it already is. There's a stark divide between the "haves" in SE Orange, and most of the rest of us in Northern and Western Orange. 15-20 years ago, hardly any of the maintenance and bluecollar support personnell that keep UNC running actually lived within 10 miles of CH. I doubt that situation has improved, what with Chapelboro house prices more than doubling since then. You're exactly right when you talk of policies set by people of privelege that primarily affect those of lesser means. This proposed tax is but one example.

At some level, the realistic alternative is for the County to increase your annual tax bill.  I think that is far more burdensome.  And don't kid yourself, the County is going to raise the funds to build the schools one way or another.

We have a "this or that choice" that people feel torn between, especially when you do the "who does it hurt more" analysis.  As I see it, it didn't originally have to be a "this or that choice." 

So Mark, are you happy that we only have this choice, or are you simply saying that this is the best of the not-so-great options that we have?

Well, it's the best option available, although I support the commissioners' decision not to put a sales tax on the ballot.  i think a sales tax would have been the most regressive choice available (and would also put our retailers in Orange at an even bigger competitive disadvantage vs. neighboring counties).  Or that's my opinion anyway . . .  - Mark Chilton not logged in
We and our elected officials continue to allow increasing exportation of money extorted by a corrupt state and federal government to fund illegal military adventurism, corporate welfare, highway boondoggle spending, etc. We know where the money is to fix our local problems. And there is a lot of it. Yet we continue to meekly send it away from our communities and then argue over the crumbs under the table. Is there a line that we will not cross when it comes to agreeing to have our money taken and wasted outside our communities?
Got any steps towards a solution to propose? I'm sure a lot of folks agree with you, myself included, but that doesn't put us any closer to changing things. I don't think the image of a whole bunch of Orange County liberals going to jail for tax evasion would pursuade all that many people, either. Is there an answer that contains something tangible?

>Got any steps towards a solution to propose?

End the two party duopoly system that all but guarantees such results and other solutions would make themselves apparent. If people at a local level would actually hold the line, and hold ALL elected officials accountable for each and every decision, rather than just going along with one party or the other on the misguided premise that one or the other is the lesser of two evils, then we might make some real progress. When your jackasses and your pachyderms are eating you out of house and home, not doing the work you got them for and destroying the farm, the first step is to quit feeding them. The second step is to look for alternative draft animals.

Part of the inherent problem is that the donkeys and elephants have all but forgotten their differentiations. Both have become mere piggies feeding at the trough made possible by a thoroughly corrupt "two" party system. If everyone who isn't being served by this insanity were to quit supporting this system, then local control might be able to reappear.

If we don't start by understanding this, we consign ourselves to a future of being abused. It's like acknowledging an alcoholic parent.

Next step is for the NC organization of County Commissioners to vote that each county puts up $2000 (or some figure that makes sense) and they hire a lobbyist to start working on getting our money back home where it belongs. Or they could put up $3000 annually and start an agency with an office and staff to work full-time on this.

Next, after a front-page article in USA Today, other states take similar action.

There is a commercial business operating in the Carrboro planning district. One one of the tracts of land where it operates, a parcel over 18 1/2 acres in size, the property tax paid by this for-profit enterprise in 2006 was only $57.08. No, that is not a typo. Fifty-seven dollars.

An adjacent residential lot, undeveloped and only 2 acres in size, paid over $760 in that same year. Where is the equity?

This business, which also violates any number of other local and state regulations with impunity, has been paying these tiny amounts of tax for years.

Until the County cleans up the scofflaws and collects a fair amount from everyone, no one should be talking about raising ANY taxes.

You can email me privately with the specifics on this supposed situation if you would like to name names more privately:

 mark_chilton@hotmail.com

And I would tell you that if you do have knowledge of such a thing,  it should be  reported to the appropriate governmental entities so that they may investigate it.   

Oh, and I have!

Nobody's ever done a thing about it. I didn't get so much as an acknowdledgement when I sent them the information.

Letters to the Commissioners? Ignored.

Vistis to Carrboro planning? "Sorry, we can't do anything."

Phone calls to OWASA? "Sorry, we have no jurisdiction."

Calls to law enforcement? A five-way hot-potato brush off: "You need to call the State Police ... then the Truck Enforcement Bureau ... then the Highway Patrol ... then ..."

I gave the same information to the N&O / Chapel Hill News, and several WEEKS later, they called back and said they weren't interested, either.

I was unaware that it was MY job to police the tax rolls for scofflaws.

This business' operations can easily be seen from the roadway and from on-line aerial views, available to anyone with a computer and browser. It's not a new thing, either; it's been going on for years.

Why do our County officials turn a blind eye to this?

I can not support a tax increase of ANY type while the County ignores existing revenue sources, such as fairly taxing commercial businesses who violate 'agricultural exemptions' and other statutes.

 

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