Mineral Springs, Indian Trail, Marvin come out on opposing sides
Three more Union County towns made their opinions heard regarding a property tax revaluation, with the councils from Marvin, Mineral Springs and Indian Trail adopting resolutions.
Mineral Springs Mayor Rick Becker presented his board’s unanimous resolution in support of the revaluation Monday, Feb. 21, to county commissioners, explaining the town adopted it Feb. 10. The Marvin village council also came out in support of the proposed revaluation, voting unanimously in support of the measure during their Friday, Feb. 25 retreat. Indian Trail meanwhile voted 3-2 to adopt a resolution opposing the revaluation, saying it’s not the time for such a measure.
“It’s safer for the taxpayer not to do this reval now,” Indian Trail council member Robert Allen said, adding he could make an argument for either side of the discussion.
County property tax values are re-examined at least every eight years, in accordance with state law. However in Union County, the revaluations have come more frequently over the past decade, with adjustments in 2000, 2004 and most recently in 2008. In keeping with the four-year schedule, the previous county commission board voted to move up the revaluation from 2016 to 2012 last year, with the hope of lowering tax bills on now over-valued homes.
“The local real estate market has undergone a recent and severe downward correction,” the Mineral Springs resolution reads. “Many Union County property values have experienced rapid and unprecedented decreases as a result of this market correction and the 2008 county tax values of these properties are now grossly inaccurate and excessively high.”
Proponents of the revaluation argue it is unreasonable to continue with current property values because they are frozen in a time that no longer exists and may not exist again. Although many homeowners are likely to experience a double-digit decline in assessed values, the result may very likely prompt county commissioners to raise the tax rate to balance the budget.
Assuming a 14 percent decline in the real estate base, Union County Tax Administrator John Petoskey has stated the county would require an 8-cent tax rate increase to keep a balanced budget.
That was the problem for some Indian Trail council members, who said that while a revaluation might bring short-term relief, once the values go up, it’s unlikely the tax rates will drop.
“Once they increase, taxes rarely go back,” Indian Trail Mayor Pro Tem Jeff Goodall said. He also raised concern about the growing number of foreclosures in the town, brought on by the struggling economy.
“In January, we had 387 foreclosures in Indian Trail,” Goodall said. “In the whole of 2007, there were 393.”
Should county commissioners vote to go ahead with the revaluation, the tax office faces a challenge shared by many counties across North Carolina in determining accurate property values. Across North Carolina, 12 counties postponed their revaluations from 2011 because they have don’t have enough sales.
In the past, the county used a sales ratio to determine fair market property values, calculated by dividing the property assessment by the sales price. Since the 2008 revaluation, Union County has seen a 70 percent decline in homes sales, and many sales took place in neighborhoods with foreclosures. Although assessment equations do not include foreclosure sales, there is no doubt sales figures in recent years are affected by homes sold at bargain-basement prices.
When left with limited figures by which to determine values, assessors must expand their comparison searches to include different areas, or perhaps take an income or cost approach. According to Petoskey’s estimates, a revaluation would cost the county about $250,000, although the cost would increase with a large number of appeals.
“That’s money that could be used to support schools or buy water and sewer infrastructure,” Goodall said.
Other council members and the mayor argued against the resolution.
“It’s political,” council member Gary D’Onofrio said, arguing situations like this turn into campaign rhetoric for those running or up for re-election.
D’Onofrio’s fellow council member John Hullinger also voted against the resolution, saying he needed more information.
“We don’t know if our area’s (values) will drop,” Hullinger said. “I don’t have any information to tell me if (the reval) is good or bad.”
Indian Trail Mayor John Quinn also refused to sign the document, stating the mayor pro tem would have to do that.
“I think the concept is reasonable (but) it’s not accurate and it’s partisan; it’s political,” Quinn said, pointing to a portion of the resolution that said a majority of the council was opposed to the revaluation and raising taxes, as opposed to just saying the council was opposed.
Over the last two months, Monroe and Weddington have been the only other towns to voice their opinion. Monroe’s town council opposed the revaluation, while Weddington failed to pass a resolution supporting either side.