NBC17 - Chatham County Residents Speak Out About Impact Fees

[srvfan]

uh, big heavy trucks do more damage to the roads.

houses with more bedrooms tend to house more children, which cost the county money to educate.

Trucks are taxed based on weight via surcharges on license fees and fuel tax since they generate more expenses then why not add a surcharge based on the number of children since they are what generate the costs not the bedrooms.

Before anyone brings up the argument that education benefits everyone, I realize that and I'm not arguing that point.  The point I'm trying to make is, roads benefit everyone as well, why are there surcharges on one but not the other?

[belle]

uh, big heavy trucks do more damage to the roads.

houses with more bedrooms tend to house more children, which cost the county money to educate.

Trucks are taxed based on weight via surcharges on license fees and fuel tax since they generate more expenses then why not add a surcharge based on the number of children since they are what generate the costs not the bedrooms.

Before anyone brings up the argument that education benefits everyone, I realize that and I'm not arguing that point.  The point I'm trying to make is, roads benefit everyone as well, why are there surcharges on one but not the other?

excellent point.

[Silk_Hope]

There are some families that stack children in living rooms and kitchens when their houses are too small.

[woodsy]

I'm sick of governments who hide behind intentionally-created crises of need for their children, elderly, and infirm in order to raise taxes yet again. Wasn't the property revalution this year ridiculous enough...based on arbitrarily and artificially high "evaluations" tens of thousands of dollars above market value? I thought *that's* what was supposed to be my fair contribution towards education in the county. This level of surprise super-taxation would cause more foreclosures and cause fewer people to be willing to buy our houses, and ain't that just what we need? Does the county not employ any economists??

As so many others of you said ... cut elsewhere. And give those dollars to the kids.

There was another proposal in some local news forum that I read in the last couple of days that suggested just taxing new construction (builders) ... or was that in *addition* to this tax hike proposal? In any event, I thought taxing new construction should be popular among we the people, as new construction increases supply and makes it harder for any of us to sell our homes, decreasing our property values. And people moving here into new construction could factor the "education supertax" into their decision of whether to move in ... and would only do so if they could afford it. People who are already here have not been offered the opportunity to budget for this, and very likely can't afford it.

Boo.

[srvfan]

houses with more bedrooms tend to house more children, which cost the county money to educate.

Just thought of another question regarding this.

Can anyone tell me why we have one tax proposed to based on # of bedrooms since the tax is for school construction and theoretically the more bedrooms a house has the higher the school cost will be, while we have an existing tax based on an arbitrary appraised value of homes.

For example, If I build a 2 bedroom house valued at 350,000 my impact fee would be lower than a 3 bedroom house valued at 150,000, using the rationalization that a 3 bedroom house has more occupants, particularly school aged occupants.  Yet at the same time the yearly property taxes on the 2 bedroom 350K house is almost 3 times higher than the 2 bedroom 150K house, even though theoretically a house with fewer bedrooms would have fewer occupants and use fewer resources, school, LE, health dept., roads, etc. than the 3 bedroom house?

At the risk of sounding repetitive why do we continue to base the largest source of our revenue, property taxes, on arbitrary values rather than on more accurate costs associated with the properties?  As a population grows or shrinks do the real estate values proportionally change?  Not necessarily, so wouldn't it make more sense to base revenue generation on population size and a per person cost than on real estate values?

 

[peacefulcapitalist]

houses with more bedrooms tend to house more children, which cost the county money to educate.

Just thought of another question regarding this.

Can anyone tell me why we have one tax proposed to based on # of bedrooms since the tax is for school construction and theoretically the more bedrooms a house has the higher the school cost will be, while we have an existing tax based on an arbitrary appraised value of homes.

For example, If I build a 2 bedroom house valued at 350,000 my impact fee would be lower than a 3 bedroom house valued at 150,000, using the rationalization that a 3 bedroom house has more occupants, particularly school aged occupants.  Yet at the same time the yearly property taxes on the 2 bedroom 350K house is almost 3 times higher than the 2 bedroom 150K house, even though theoretically a house with fewer bedrooms would have fewer occupants and use fewer resources, school, LE, health dept., roads, etc. than the 3 bedroom house?

At the risk of sounding repetitive why do we continue to base the largest source of our revenue, property taxes, on arbitrary values rather than on more accurate costs associated with the properties?  As a population grows or shrinks do the real estate values proportionally change?  Not necessarily, so wouldn't it make more sense to base revenue generation on population size and a per person cost than on real estate values?

All good questions but moot since state law dictates the funding methods counties can use.  You can argue that the current property/sales  tax based system is unfair, but that's what the state requires counties to use.

[srvfan]

All good questions but moot since state law dictates the funding methods counties can use.  You can argue that the current property/sales  tax based system is unfair, but that's what the state requires counties to use.

That's true, but at one time state law allowed the intangibles tax, maybe we should bring that back to take some burden off landowners.  Also at one time state law did not allow the LTT or impact fee option. 

State laws can be changed, and the movement to change usually begins at various county levels.

While counties may be bound by state law regarding revenue generation doesn't mean the various boards can't work at the state level to get those options changed to what could be a fairer, less volatile method of revenue generation.

[Keith_Brown]

All good questions but moot since state law dictates the funding methods counties can use.  You can argue that the current property/sales  tax based system is unfair, but that's what the state requires counties to use.

That's true, but at one time state law allowed the intangibles tax, maybe we should bring that back to take some burden off landowners.  Also at one time state law did not allow the LTT or impact fee option. 

State laws can be changed, and the movement to change usually begins at various county levels.

While counties may be bound by state law regarding revenue generation doesn't mean the various boards can't work at the state level to get those options changed to what could be a fairer, less volatile method of revenue generation.

Are there counties, either in NC or in other states, that do rely on something other than property taxes for the bulk of their funding?   It's be interesting to see what they use, comparisons of populations and services, etc.

[srvfan]

Are there counties, either in NC or in other states, that do rely on something other than property taxes for the bulk of their funding?   It's be interesting to see what they use, comparisons of populations and services, etc.

Interesting question, I actually have no idea.  My best guess would be that the majority of counties and cities generate revenue via property taxes, probably for the same reasons we do, the state doesn't allow them many options.

I believe some states, Florida maybe??, has an intangibles tax option, although I don't know if that is for state or county funding, and I vaguely remember the NC intangibles tax, was it for state funding or did much of it trickle down to the county level?

I realize there would be kinks to work out with a new system, but NC gets a lot of credit for innovations in the early 1900's regarding various options of revenue generation and how that led to infrastructure and education advancements.  Maybe it's time to think outside the box again.

I also realize the NC constitution calls for "free education" but would a surcharge or impact fee for school construction go against that?  Some would say it does, but then again property taxes are going toward paying for schools so there is still a charge to residents for that "free education".

I am not advocating more taxes just for the purpose of more taxes, but I do think the intangibles tax option should be explored.  Why should someone with an investment of 500,000 in real estate such as farm land or timber be charged property taxes while someone with 500,000 invested in stocks not be?  Should we continue to raise taxes on one group of people or should we include more people in the tax base with lower rates for everyone?

[peacefulcapitalist]

All good questions but moot since state law dictates the funding methods counties can use.  You can argue that the current property/sales  tax based system is unfair, but that's what the state requires counties to use.

That's true, but at one time state law allowed the intangibles tax, maybe we should bring that back to take some burden off landowners.  Also at one time state law did not allow the LTT or impact fee option. 

State laws can be changed, and the movement to change usually begins at various county levels.

While counties may be bound by state law regarding revenue generation doesn't mean the various boards can't work at the state level to get those options changed to what could be a fairer, less volatile method of revenue generation.

Are there counties, either in NC or in other states, that do rely on something other than property taxes for the bulk of their funding?   It's be interesting to see what they use, comparisons of populations and services, etc.

Yes, there are several counties in NC that have the LTT that get a large percentage of their funding from it and also have low property tax rates as a result.   This was widely discussed during the unsuccessful 2007 LTT campaign.   Of course when you see what happened when we tried to bring that option here you understand why there will be no serious interest in looking at alternatives to the property tax and impact fee for a long time.

[peacefulcapitalist]

I am not advocating more taxes just for the purpose of more taxes, but I do think the intangibles tax option should be explored.  Why should someone with an investment of 500,000 in real estate such as farm land or timber be charged property taxes while someone with 500,000 invested in stocks not be?  Should we continue to raise taxes on one group of people or should we include more people in the tax base with lower rates for everyone?

The NC intangible personal property tax was repealed when the U.S. Supreme court ruled that it was an unconstitutional barrier to interstate commerce, because NC's law taxed the stocks of out of state companies but not in-state companies.  There were two ways they could have satisfied that ruling, either by including in-state companies in the tax or repealing it, and they chose to repeal it.  I don't think you'll ever see it come back, this was all before the age of widespread ownership of securities in tax-advantaged accounts like IRAs and 401(k)s, which certainly muddy the waters on what assets are taxable and what aren't.

Also, to use your example, the county and municipal governments do not have to provide services for $500,000 in stock in AT&T, like they do for a $500,000 house. 

[chathambooks]

All good questions but moot since state law dictates the funding methods counties can use.  You can argue that the current property/sales  tax based system is unfair, but that's what the state requires counties to use.

That's true, but at one time state law allowed the intangibles tax, maybe we should bring that back to take some burden off landowners.  Also at one time state law did not allow the LTT or impact fee option. 

State laws can be changed, and the movement to change usually begins at various county levels.

While counties may be bound by state law regarding revenue generation doesn't mean the various boards can't work at the state level to get those options changed to what could be a fairer, less volatile method of revenue generation.

Are there counties, either in NC or in other states, that do rely on something other than property taxes for the bulk of their funding?   It's be interesting to see what they use, comparisons of populations and services, etc.

Yes, there are several counties in NC that have the LTT that get a large percentage of their funding from it and also have low property tax rates as a result.   This was widely discussed during the unsuccessful 2007 LTT campaign.   Of course when you see what happened when we tried to bring that option here you understand why there will be no serious interest in looking at alternatives to the property tax and impact fee for a long time.

Your assessment of the 7 counties that have the LTT is not accurate:
http://chatham-county-nc.com/bulletinboard/index.php/topic,2680.0.html

[srvfan]

In theory the LTT would increase the tax base and lower taxes on property owners.  I did oppose it and still do, mainly because it is also based on real estate values, and IMO real estate values are not the way we should be generating revenues to pay for services.  If we're going to find a different way of generating revenue that is still based on real estate values we really havn't done anything different. 

$500,000 of farm land or timber has a very minimal impact on county services, fire protection, some LE protection and whatever environmental dept oversees raw land is pretty much the extent of the costs associated with that land.  I do realize the land use exemption lowers the property taxes by a fairly significant margin for that land and I guess for those very reasons. 

The point has been made that the county doesn't have to provide services for $500K in AT&T stock like it does for a $500K house, which is also a valid point.

If we do not tax stock holdings because those holdings don't require the county to provide services then why do we tax a retired couple in a 500K house more than we tax a young married couple with 2 children in a 200K house?  Which situation generates more cost to the county?

If we are going to arbitrarily tax the 500K house more because it is valued more or if we are going to add a LTT option because it would generate revenue then why not look into bringing back the intangibles tax?  Taxing one asset seems to be as good as taxing another.  Is it because those that favor the LTT are already here with established land and homes and no plans to buy additional land or build a house, yet they do own stock?

Until we find a way of accurately matching revenue with expenses we are going to continue to place an increasingly heavier and heavier burden on owners of real estate.

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