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NEWS

Commissioners put sales tax hike on the ballot

Thursday, August 26, 2010
(Updated 1:55 pm)
By Joe Killian
Staff Writer

GREENSBORO — A quarter-cent sales tax hike will go to the voters this November as the Guilford County Commissioners continue to look for new revenues for the cash-strapped county government.

That would bring the Guilford County sales tax rate from 7.75 percent to 8 percent — or about an additional penny for every four dollars of a purchase.

The commissioners voted 9-1 Wednesday to send the tax hike to the voters, with Commissioner Kay Cashion absent and Commissioner Steve Arnold the only "no" vote.

Arnold, a staunch conservative, said he understood that the county needed to find a way to service the more than $500 million in bond debt voters approved in 2008, but still couldn't bring himself to vote for a tax hike for that or any other reason.

"I do believe and have believed these many years that government is too big, that taxes are too high," Arnold said.

The other commissioners — including Republicans Linda Shaw and Billy Yow — said they would rather see a voter-approved sales tax increase than a property tax increase.

"I just don't think any more burden needs to go on the property owners in Guilford County," Shaw said. "This is not us sitting here and saying we approve a tax rate. This is giving people the chance to vote. It will be up to them."

Yow said the $11.6 million the county estimates the increase will bring in each year will not come close to covering the bond debt voters approved for new schools, parks projects and a new county jail. Still, he said, he'd rather see the burden shared by everyone than put solely on property owners.

Commissioner John Parks said the voters approved the bond debt and it was now the board's job to find a way to pay for it as best they can -- a position in which many counties in the state have found themselves after the economic downturn.

"Seventeen counties have approvesd this sales tax increase and three others are considering it," Parks said. "We're not alone in this endeavor.

 Read more in Thursday's News & Record and in our e-Edition.

Accompanying Photos

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jmoffat

August 25, 2010 - 5:10 pm EDT

When bond referendums are voted on, it is made abundantly clear that, if approved, the bonds would result in a tax hike. Newspapers usually write this in the second or third paragraph of bond referendum stories. Elected officials (not including school board members, for obvious reasons) tell this to voters repeatedly in the days leading up to the vote.

If bonds are approved, it is the burden of taxpayers (especially property owners who voted for the bonds in the first place) to pay for it. This is the reason elected officials give when they increase property taxes the following year. By attempting to increase the local sales tax, Guilford County Commissioners are, in essence, double-taxing us, as well as attempting to get additional revenues from outside sources to pay for amenities they will never use (schools, in particular).

If this is approved, I am assured my discretionary income will be heading across the county line to Alamance County. A line which might be moved on me before too long to get some more lucrative tax dollars.

Panacea

August 25, 2010 - 8:07 pm EDT

You state, "If bonds are approved, it is the burden of taxpayers (especially property owners who voted for the bonds in the first place) to pay for it."

Not quite true. First of all, ALL voters have a say in bond, whether they are property owners are not. The ASSUMPTION is property taxes will pay for bonds, but in fact any source of tax revenue will do. So the Commissioners will not be double taxing us as there are no plans in the works to raise property taxes for bond payments.

Most people won't want to be inconvenienced by driving all the way to Alamance County. Some will, some won't. It will depend on whether or not the savings on taxes are counter balanced by the costs in gas and time.

This isn't the same as raising sales taxes when you border a no sales tax states like Delaware. The benefits of going elsewhere need to exceed the costs. A quarter cent isn't going to be worth going elsewhere.

Online? Maybe :)

jmoffat

August 25, 2010 - 8:55 pm EDT

The assumption that property taxes will pay for bonds comes from the elected officials who tell us that property taxes will need to be raised if, indeed, bonds are passed each November (and as of late, it does feel like a bond referendum is on the ballot each November, doesn't it?). And while other forms of revenue can be/are used to pay off debt, it is the constant hum from our elected officials ("If you pass this, it will result in a X-cent tax increase") and their subsequent actions that lead to my viewpoint.

While you are correct that all voters, not just property owners, have a say, I would assume (rightly or wrongly) that the majority of voters who actually turn out are property owners (N&R -- get me a stat on that, please). Therefore, property owners are most responsible. And I am lucky enough to live close enough to Alamance County to make that an option for myself, while quite possibly not for others.

casper

August 26, 2010 - 9:00 am EDT

While you are correct in the argument that property owners turn out to vote in higher numbers, you are wrong in your assertion that they should be responsible to pay the taxes alone. Unless non property owners are willing to give up thier right to county provided services, they should pony up just like everyone else. Of course if you are a renter then your landlord will pass the tax increase on to you in higher rent. Amazing how simple economics work.

Panacea

August 26, 2010 - 9:43 am EDT

Good point about the rents, and very true.

Panacea

August 26, 2010 - 9:33 am EDT

To assume that property taxes have to be raised is a fallacy since the tax increase is not included with the bond issue.

When economic times are good, bond issues can be funded without tax increases. However, it is fair for politicians to warn us that a tax increase is likely, and property taxes are often the tax of choice.

However, any tax will do.

Don't assume just property owners vote. I voted for several of these bond BEFORE I became a property owner two years ago. I've voted in every election, but I've only been a property owner for 2 years. Also, don't assume that all property owners are responsible . . . you assume facts not in evidence. Don't assume those who don't own property are irresponsible . . . also facts not in evidence.

Also, even though you live close to the Alamance border, unless you shop there regularly NOW, my bet is you will find a mere quarter cent increase to not be worth going out of county.

jmoffat

August 26, 2010 - 10:02 am EDT

To your points: I never assumed only property owners vote. Said so above. I never assumed all property owners are responsible. However, with an approximate 96% tax collection rate, I would say the majority are responsible.

And this isn't a matter of paying an extra penny for every $4 spent (which is what the math breaks down to, if I am correct). It's a matter of principle: We pay and pay and pay. We see increases in county revenues (which there was from 2008-2009, even in these tough economic times). We are told of "needs" that should more appropriately be titled "wants". And we are told how to pay for them, which we accept (by referendum). But then we are told we can't afford these "needs"/"wants". Shouldn't we have done this type of research beforehand?

You are correct that in good economic time, tax increases are not necessary to pay off bonds. But to my point (which I have stated numerous times), over the past few years our elected officials (and this newspaper) have told us that if you vote for these bonds (school, jail, parks, etc.), it will impact your property tax rate by X-percentage. They have the choice of finding alternative forms of revenue, but even if they do, the property tax rate has gone up by the previously-stated percentage.

Panacea

August 26, 2010 - 12:26 pm EDT

Most of the recent bond issues were needs not wants.

We needed to rebuild Eastern HS (even though some moron decided we didn't need fire insurance)

We needed to build a new jail . . . or face court sanctions.

GTCC needs more parking, with enrollment breaking records every semester for the past five years.

My point is just because property taxes are most often used, that doesn't mean it HAS to be the source to pay for bond debt. Your thinking is fallacious . . . it doesn't matter what politicians say, it matters what they DO.

Property taxes have not gone up to pay for this debt . . . Skip Alston is doing everything he can to prevent that because he doesn't want his own taxes to go up on all the real estate he owns.

kevin007

August 25, 2010 - 6:41 pm EDT

How about all city executives take a pay cut? None of those people have been affected by the recession.....When High Point wanted to access a fee to all utility customers Mike Pugh suggested the all city workers take a pay cut instead. Ol Strib (I work harder than anyone in High Point and should get paid for it) thought about how much he would have to give up and the next day everything was off the table....You gotta love government...they think they are immune to everything! But spend hours and hours thinking up ways to squeeze more money out of the taxpayer and don't spend to much time on how to spend what they have wisely!

tledford

August 25, 2010 - 7:44 pm EDT

It's actually the County proposing the sales tax increase rather than the City, but otherwise, I agree with you. Why don't we pay the County Commissioners what they're worth? $0. That would save a *little* bit at least.

NicoToscani

August 25, 2010 - 7:00 pm EDT

People need to pony up or quit driving on public roads and sending their kids to public schools, put out their own fires, and police their own communities. Higher taxes are what keep North Carolina from looking like South Carolina, a.k.a. "America's Armpit".

jmoffat

August 25, 2010 - 8:58 pm EDT

Nico: It's not a matter of paying up or shutting up. I have no problem paying for a bond referendum that I voted for -- or even voted against -- as long as I know the consequences. And BTW -- there are plenty of states with higher tax rates and less quality and vice versa. Just saying you pay more doesn't mean you get more.

SusieQ

August 25, 2010 - 10:02 pm EDT

I agree that we should pay just a little more to help out our county, but I take issue with YOU insulting our neighbor to the south!

casper

August 26, 2010 - 9:04 am EDT

Anyone who thinks they should pay more in taxes should simply go to the county offices and write a check, they will gladly accept donations for taxes. Why the Hypocrisy? Just go pay more!!!

rmacz

August 26, 2010 - 9:30 am EDT

My sentiments exactly!

Panacea

August 26, 2010 - 9:44 am EDT

Because everyone should pay their fair share, that's why. We have this debt. We have to pay it. We can whine about how the Commissioners manage the budget all we want, but the debt is still there.

rmacz

August 26, 2010 - 12:11 pm EDT

We have no problem paying our fair share....ha!, but it's their (our elected officials) fault we're in this mess. Let them take a pay cut, and all those libs that believe in tax and spend utopia, pay more. Also, let them forfeit their retirement funds. They should pay the consequences.

Panacea

August 26, 2010 - 12:28 pm EDT

No, it's our fault.

We the voters approved the bonds. We the voters elected the people running our county.

You don't get a pass on taxes simply because you disagree with them, or with how the county is run.

If you don't like it, get involved instead of just complaining.

Greensboro_42

August 25, 2010 - 9:17 pm EDT

I guess it would be just too difficult to NOT raise taxes and actually cut the size and scope and pensions of government workers? Taxes in this state are too high already. Adding more does nothing to reign in the rampant spending of a government gone out of control. Stop taxing us! Instead, cut pay, cut heads, cut un-needed services. CUT GOVERNMENT FIRST before coming to us with your hands out.

Panacea

August 26, 2010 - 9:50 am EDT

Pensions are mandated; government has to spend money on pensions already earned. Bear in mind, public servants pony up for their pensions, not optional. North Carolina's pension system is one of the best in the country, so the pension system is not putting a burden on our government like in some other states.

I've read a lot of complaining about the size of government. . . then read the howls of protest when Greensboro considered cutting curbside leaf service to save money.

Seems to me people want government to cut, cut , cut . . . oh, except when it affects THEM in a way they can see.

jmoffat

August 26, 2010 - 10:06 am EDT

I don't think it's a matter of "when it affects THEM." I think it's a matter of being sold a false bill of goods. The county said this is how we'll pay for it, but then they come back and say, oops, we figured it wrong. I have no problem paying for schools, jails, parks or anything else that's needed in the community. But I would like our elected officials (all of them), our government staff and our electorate (before they vote) to do their homework beforehand.

Panacea

August 26, 2010 - 12:31 pm EDT

Our government staff usually does.

To think we can spend more money and not raise taxes is wishful thinking, no matter what the politicians say.

I knew when I voted for the bonds (jail, GTCC's parking deck, Eastern HS, Parks and Rec) that taxes would eventually go up to pay for it. These are important things, so I went into it with open eyes.

woodman114

August 25, 2010 - 10:45 pm EDT

Let the people that voted for the bond, pay for it. Not the homeowners and all others.

Panacea

August 26, 2010 - 9:50 am EDT

Not the way our system of democracy works. Sorry.

uncwgm

August 25, 2010 - 11:23 pm EDT

Personally I think we need a voluntary moratorium on bond expenditures given the radical change in the economy since these bonds were voted in.

Sadly, I don't see this happening with our Guilford County Commissioners or the Greensboro City Council.

It would make for a great platform to run on for those with more backbone!

As far as the sales taxes go - I'd rather see EVERYONE feel the pain...not just property owners - and especially those increasing numbers that pay nothing but expect everything by an ever dwindling number of citizens that pay for them like myself btw...

We're not unique, this is true for city, county, and state spending - don't even get me started on the federal stuff..sigh...

Panacea

August 26, 2010 - 9:53 am EDT

We can't stop payment on the debt once the bonds are issued. For example, the bonds on education and to rebuild Eastern that passed are already issued; we have to pay on that debt regardless of county finances.

I haven't heard of any proposals to put more bonds on any ballots, because the Commissioners know we can't afford it, and they would not pass.

Greensboro could have held up the bond issue on the swim center if they really wanted to, but chose not to.

RonaldusMagnus

August 26, 2010 - 7:59 am EDT

Put the bonds and the subsequent tax increases both on the ballot and both will be rejected. If you haven’t noticed the economy is in the toilet in this county and state. Still they still try to squeeze more tax revenue out of us and waste our money on bike paths and above average salaries for themselves. These people have to be voted out of office before they ruin this county and state if it isn’t too late already. There will be no tax revenue from empty buildings where businesses used to be.

casper

August 26, 2010 - 9:06 am EDT

Wow, good post!

goodtimes

August 26, 2010 - 9:01 am EDT

It's pretty simple: If you want to reduce an economic activity, then increase the tax on it ie. alcohol, cigarettes, gasoline, real estate, etc... If you want economic activity to increase then cut the tax on the activity. The citizens will
reduce their consumption by the amount of tax; currently at 7.75% and proposed to go up; it won't end well as usual.

Panacea

August 26, 2010 - 9:54 am EDT

Actually, that is not true. Most people will continue consuming regardless of the tax.

If your logic were true, no one would ever pay sales taxes.

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