06/08/11 — County eyes 2011 budget, hears tax hike protests

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County eyes 2011 budget, hears tax hike protests

By Steve Herring
Published in News on June 8, 2011 1:46 PM

The $1.3 million that would be generated by a proposed 2.35-cent increase in the Wayne County tax rate would quickly be gobbled up by reduced state funding for the Department of Social Services and Health Department and a state-mandated increase to the state retirement plan, County Manager Lee Smith said.

The county will "eat" another $4 million in budget increases caused by the state, Smith told commissioners at their Tuesday meeting.

News of the potential tax increase, as well as the property values set by the recently completed county-wide property revaluation, did not sit well with several people who spoke during the public comment portion of the meeting.

There also appeared to be some confusion about the revaluation process. The new property values were mailed in late May, and so far the county has received about 350 informal appeals from people questioning their new property values, Tax Administrator David Ward told commissioners.

The state requires a revaluation every eight years and that the county advertise a revenue-neutral rate -- a rate that is estimated to produce revenue for the next fiscal year equal to the revenue for the current fiscal year if no re-appraisal had occurred.

The revenue-neutral rate for Wayne County would be 70.25 cents per $100 worth of property value. However, the budget lowers the current property tax rate from 76.4 cents to 72.6 cents, which in effect is an increase of 2.35 cents.

For someone with property valued at $100,000, the increase would mean an additional $23.50 on their tax bill.

The board will hold a budget work session June 13 at 8:30 a.m. in the commissioners' meeting room on the fourth floor of the county courthouse annex. A public hearing on the budget will be held June 21 at 9:15 a.m. in the commissioners' meeting room.

The $158 million budget does not provide for an across-the-board salary increase for county employees. And it maintains the county's hiring freeze.

It also reduces the solid waste user fee from $60 to $45.

"From what I have seen of the budget, I don't see any significant increases that we have put on. It looks that from what I have seen thus far we have a clean budget. I know a lot of citizens are concerned, and I ask for a chance to see what happens in Raleigh and give us a chance," Commissioner Andy Anderson said.

"This is not our budget yet. We are going to have a work session and talk about the budget," Commissioner John Bell said.

Bob Jackson, chairman of the county Republican Party, was one of the people who spoke.

"I know that you have not had your deliberations, but if I could say a few words that might, just might, influence what you talk about so that you might know how some of the taxpayers of Wayne County are faring at the moment. With the economy being what it is how do we sell a tax increase to the taxpayers of Wayne County? I believe it is going to be tough. Some re-evaluations that I am aware of are between 10 and 30 percent increase," Jackson said.

Jackson cited one case in which a house sold for just under $25,000 several months ago. It is located in the flood plain and the insurance is very expensive, he said. Its value doubled to $52,000, Jackson said.

"That seems to be common in some areas," Jackson said. "People are concerned, some seem to be upset and as Commissioner (Steve) Keen understands, some are very upset that there might be a tax increase."

Jackson said he has property in a subdivision that he had been unable to sell for more than two years.

"I tried to get an auction company to come in and have an auction," he said. "They looked at the property and turned it down. They said, 'We can't make any money.' But if in fact you do find somebody that will do it for you, you can expect top dollar to be 60 percent of what you are asking for it."

Realtor Hal Keck said he has been in business in the Wayne County area for 20 years and that over that time there has been an approximately 2 to 2.5 percent overall appreciation rate in real estate. However, he said that starting about three years ago the local market started to slow down "dramatically."

"The reason it started to slow down is we were having the burst real estate bubble that you all are aware of," he said. "Since that three-year point our market has decreased. It hasn't just flattened, it has decreased. A lot of that is because of all of the repossessions that we have on the market and that we are trying to clear. It appears it is going to be another two years just getting rid of that backlog of repossessed homes. I don't know how the re-evaluation occurs very truly. I know how market analysis occurs."

Keck said he did not think the appraisers did a thorough job in determining housing values and that that tax officials should explain to the public how the new values were determined.

Keck said he is getting calls from people asking how the county is doing what it is doing and how can they challenge their valuation.

"They say it is going up 20 percent, 30 percent," he said. "That is crazy. It is not happening. If they think my house is worth that, I will sell it to them. A lot of people say that."