THE LIST: The last 6 county property tax rate changes

BY ZACHARY HORNER, News + Record Staff
Posted 6/14/19

Did you know that, in one year, the Chatham County Board of Commissioners dropped the county’s property tax rate by more than 20 cents?

While that’s the most drastic change in the tax rate in …

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THE LIST: The last 6 county property tax rate changes

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Did you know that, in one year, the Chatham County Board of Commissioners dropped the county’s property tax rate by more than 20 cents?

While that’s the most drastic change in the tax rate in the last 20 years — a 20.36 cent drop in fiscal year 2001-2002 — it’s far from the only one.

The Chatham County Board of Commissioners has approved the county’s fiscal year 2019-20 budget, which includes a 4.19-cent property tax rate increase. That marks the tenth change in the county’s tax rate in the last 20 years and 7th time in the last 12 years.

For the first edition of the News + Record’s new every-other-week feature “The List,” we’re looking at the last six instances of rate change and the reasons for them, as given by the respective county managers in their budget messages. Two of the years, the only decreases, came in revaluation years, where the county reconsidered the value of all real property, something required of local governments every eight years.

2008: Increased by 2 cents to 61.70 cents

“We recommend earmarking the additional pennies for schools...including the additional operating costs of Virginia Cross Elementary,” wrote County Manager Charlie Horne. The county’s education budget increased by $800,000 in fiscal year 2007-08 to accommodate the school’s opening, and other funds brought in by the increase were projected to go to the school system. At the time, one cent of the tax rate generated $682,001.

2009: Increased by 3.6 cents to 65.3 cents

Horne recommended the tax rate jump to 67.2 cents, but the commissioners’ final vote kept it at 65.3 cents. The original 5.5-cent increase was recommended to be split four ways: 1 cent for a parks capital reserve fund, 1 cent for water capital needs to fund future debt, 1.2 cents for schools and 2.3 cents for general fund needs, including public safety personnel. While real property values were expected to grow, the County Manager’s Office estimated that “job losses, tightening credit and rising gasoline and food prices (would) jeopardize the county’s excellent collection percentage for property and motor vehicle taxes.” One tax rate cent was estimated to generate $722,266.

2010: Decreased by 5.08 cents to 60.22 cents (Reval)

The county budget increased by only $234,553, with revenues down “signficantly” from sales tax, fees and permits, occupancy tax and more, leading to a 7 percent reduction in the general fund operating budget. But the revaluation showed countywide real property values increased by an average of 23.6 percent, and the overall property tax base increased by 15 percent. The original budget proposal was for a 60.32-cent tax rate, a “revenue-neutral” rate, but the commissioners approved a budget with a rate 0.1 cents less. One penny of the tax rate was anticipated to generate $826,264.

2011: Increased by 1.97 cents to 62.19 cents

For the fourth change in as many years, the property tax rate went up by just under two cents. The original budget plan submitted by Horne recommended a 2.5-cent increase, with 1.83 cents dedicated toward opening Margaret B. Pollard Middle School, a new library and two new community college buildings. The commissioners got the increase down by 0.53 cents by reducing the general fund budget. One cent of the tax rate produced $836,504.

2017: Increased by 1.19 cents to 63.38 cents

After five straight budgets with no change, County Manager Renee Paschal recommended the 1.19-cent increase. Real property values were expected to grow by 3.7 percent, but the total value of properties exempt from property tax, thanks to a law passed by the N.C. General Assembly, was upped by 5.1 percent. The rate increase covered “additional resources needed to increase the contribution to the debt reserve for a new elementary school” (now Chatham Grove Elementary School) as well as the new Central Carolina Community College Health Sciences building (which is now nearing completion) in Briar Chapel and expanding plans for the yet-to-be-named Seaforth High School from 800 to 1,000 students in size. One cent of the tax rate would generate $990,630.

2018: Decreased by 0.57 cents to 62.81 cents (Reval)

As has beeen the case with the last few property revaluations, the exercise led to the county rax rate dropping, ever so slightly this time. The commissioners at the time told the staff, according to Paschal’s budget message, that the rate should be based on property values had revaluation not occurred. As a result, the county didn’t add several positions or new services. Pascal wrote that the budget “doesn’t fund everything we think we need, but it does meet the direction of the Board of Commissioners and funds the positions and other requests that help us keep up with growth.” But between the budget’s presentation and work sessions, corrections and adjustments were made to accomdate some new positions originally rejected thanks to new tax revenue, federal grants and some fund balance appropriation. One cent equaled $1,1035,153.

Have an idea for another edition of The List? Reach Reporter Zachary Horner by email at zhorner@chathamnr.com or on Twitter at @ZachHornerCNR with your suggestion.

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