Local property values to rise
Published 4:24 pm Wednesday, April 22, 2009
In 2011, property owners may pay higher tax bills
By TED STRONG
With property revaluation and a rocky economy looming, County Manager Paul Spruill will present a budget on Thursday to the Beaufort County Board of Commissioners.
This is the last year people owning real estate in Beaufort County will be taxed based on values established in 2002, the last year there was a required revaluation. The budget will no doubt be controversial, but for county officials the real monster looms just over the horizon.
In 2011, Beaufort County residents will see their tax rates drop and their tax bills rise, even though the county has pledged to adopt a revenue-neutral budget. (For an explanation of revenue neutrality, please see sidebar with jump.)
The reason: The county will have updated property values, which rose during the past eight years, even if they’ve dropped from their peak some during the past two.
Because the county taxes real estate and all other taxable property (cars, etc.) at one set rate, the increase in property values means owners will end up providing a larger proportion of the county’s revenue.
Property owners will find out how much the county now considers their property to be worth when notices are mailed out, likely early next year, said Bobby Parker, the county’s tax administrator.
More than 200 people gathered on Second Street last week to protest that their tax bills are already too high.
At that rally, Commissioner Hood Richardson said he’s thinking about another such rally to pressure other commissioners on the revaluation issue. Earlier this year he called for a blind 10-percent budget cut in this year’s budget, but the other commissioners rebuffed his proposal as impractical and foolish.
But the pressure reflects the jam in which county leaders find themselves.
Officials have pledged not to increase tax rates through the 2010-2011 fiscal year and to keep the budget revenue neutral that year.
At the same time, the sour economy has decimated some of the county’s other sources of revenue, including sales tax payouts from the state, forcing layoffs. And officials need money in the bank to help them meet their revenue-neutral pledge.
That means they’ll work with a thin budget, while worrying that their constituents will blame them for higher tax bills.
There will be one bright spot once the revaluation takes place, read the county’s own analysis: “Those who own motor vehicles, heavy equipment, and manufacturing equipment will benefit from property tax relief of as much as 20 percent decrease …”
One of the biggest winners is likely to be PCS Phosphate, which has a lot of manufacturing and land-moving equipment.
What is revenue neutrality?
The county has pledged to keep the tax rate revenue-neutral after the revaluation, but what does that mean?
It means that all the cars, trucks, houses, land, airplanes, you name it — that were in the county in one year will collectively generate the same amount of money the next year. The amount of money the county collects will grow slightly because the total amount of taxable goods in the county will grow slightly as new homes are built, new cars are purchased and so forth.
The increase will affect homeowners the most because the assessed value of homes and land is expected to dramatically rise.