Agenda - 04-30-2007-e - Laserfiche WebLink

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$ 1. He said that in the coming budget year it would require a three cent increase in the tax rate to pay debt service, three cents to completely food the schools' increased operating expenses, and three cents for recommended increases in the the County's operating budget. It might be easy for some to say that we should raise taxes by nine or ten or twelve cents per year, he said, but when the tax rate is akeady at $ .84, then it takes only three years of those kinds of tax increases for the rate to get up to $1. Our tax base 'is increasing at only 2% per year, he said, and it's simple mathematics to see that taxes should not increase annually by 20%. "Political will" is not the only limit on the increase in taxes, he said. It also is prudent financial planning. Any county that gets its tax rate up to $1.10 is going to have the state Local Government Commission reviewing "everything that they're doing." You'd have folks ~in Raleigh asking lots of questions if you went over $1, he said. Dr. Pedersen recalled the group's attention to the handout titled, "County's Annual Debt Service Projections," and asked which of the four bars within each of the fiscal years should be used to identify the most relevant difference between debt ceiling and anticipated debt. Mr. Visser said that the 1/20/06 bar (farthest to the right) should be used for that purpose. However, Commissioner Gordon said that the 1/20/06 bar reflects a staff recommendation only. She asked that the record of this meeting note the-need for the Commissioners to adopt into policy a Bond and Alternative Issuance Plan. Mr. Copeland noted that beyond "political will" is the actual ability of people to pay .more in taxes. Our districts are composed of two different sets of people, he said, and we need to appreciate how much the city's district tax affects OCS. When we talk about raising the ad valorem tax and raising the district tax, he said, we're talking about raising taxes on people who aze on retirement incomes. As farmers, they are living off of what they put in the bank. They don't have 401-K's or retirement accounts from working at the university, he said. The other counties azound us aze not raising taxes; Alamance County's tax rate is around $ .56, he said. We need to ask what it is that the people in Orange County aze getting in return for paying $ .84. At some point,lVlr. Copeland added, the Commissioners need to relax the rules on development in our county. He also called the group's attention to the handout titled, "One Cent of Property Tax Equivalent," and compared the revenue that would be generated from a penny increase in the ad valorem tax ($1.2 million) to the amount that would be generated from a penny increase in the district tax ($763,338). "If OCS had a district tax, it would only bring in around $400,000," he said. Dr. Hamilton asked 1Vlr. Visser to explain the County's debt ceiling. Mr. Visser explained that 10 years ago the BOCC imposed a debt management policy on itself. The policy capped the County's annual debt service expenditures at no more than 15% of the County's annual general fund expenditures. 1VIr. Link asked the group to note that the Commissioners are working hard to achieve economic development in appropriate areas within the County. He added that 40% of the tax base outside of the County's three municipalities is in "use value, "which allows the 5