Majority on council support 4-cent property tax increase
by Mike Parks
INDIAN TRAIL – Saying it’s time to seriously invest in the future of the town, Indian Trail Councilman Christopher King recommended a 4-cent tax increase at the Tuesday, May 22, budget workshop. And as of now he’s got the support to pass it.
“The budget’s too tight… it’s too tight,” King said to nods from other council members Tuesday night. “It’s time to grow it.”
Town staff had put together a 2012-13 budget that kept the property tax rate flat at 14.5 cents per $100 of assessed value. Residents would see an increase by means of a $30 annual solid waste service fee – there currently is no fee – and another increase if the town approves an $8.5 million parks and recreation bond in November.
King’s recommendation calls for increasing the town’s exceptionally low property tax from 14.5 cents to 18.5 cents to create a capital improvement and debt reduction fund. He would do away with the $30 waste fee. The money generated by the tax hike – around $1.18 million – would be used to pay off debt if the town takes on any for road or park projects in the near future, as well as be available for any capital improvement projects the town may consider down the road.
For a homeowner in Indian Trail with a $150,000 home, the tax bill would increase by about $5 per month, about $60 a year.
But the money also would be there in case Indian Trail sees the state or federal government pull back on any of the annual funds those entities give to the town. When presenting the budget proposal earlier this year, Town Manager Joe Fivas warned council members that Indian Trail could be in serious trouble if the state cut funding because of how little town property tax revenues make up the overall budget.
Councilman Robert Allen made that point Tuesday night, stating that if the town doesn’t prepare now for cuts from the state, residents are going to likely eventually see some disruptions in town services.
“We’ve been operating on a shoestring (budget) for so long … I don’t know that 4 cents is enough, but it’s a step in the right direction,” Allen said.
“If we’re going to move forward and do anything, we have to (raise taxes),” King added. “I’m not even sure 4 cents is enough.”
Along with King and Allen, Councilwoman Darlene Luther spoke in favor of the increase Tuesday night. She said it’s obvious people in town want to see an investment made in Indian Trail, though not everyone is willing to foot the bill. She pointed out that, even if Indian Trail doubled its current property tax, it would still fall short of any other town in North Carolina with a similar population. The closest town tax right now is Matthews, at 30.25 cents.
But that isn’t a good reason to increase taxes, argued Councilman David Waddell. Instead of raising taxes or taking on debt, Waddell said the town should instead look at ways to cut government and not waste money on “amenities” like a park. Waddell also worries residents may see another property tax soon when Union County completes its revaluation, much like residents in Mecklenburg County recently went through.
While the three in favor of the increase said it’s needed to help move the town forward, Waddell isn’t sure everyone’s on the same page with exactly what the town needs right now.
“I think we need to ask ourselves just what ‘moving forward’ means,” he said.
Indian Trail Mayor Pro Tem David Cohn also wasn’t sold on the tax increase. Cohn said he’d like to know exactly what the money would be used for before he threw his support behind the hike. Mayor Michael Alvarez also didn’t take sides. At one point he suggested the town consider pushing the tax increase off until next year’s budget, while at another he reminded council “we’re living paycheck to paycheck as a town.”
Alvarez would only vote on the issue in case of a tie.
Fivas, the town manager, was instructed Tuesday night to take another look at the budget without the $30 solid waste fee and come back to council with his thoughts. He said at the meeting the 4-cent tax increase could probably be used to cover funding lost from elimination of the proposed fee. As for the rest of the increase, it wouldn’t change this year’s budget as the money would be set aside in a fund for future use.