Wed June 19, 2013
Mecklenburg Commissioners Approve 2.35-Cent Tax Increase
Mecklenburg commissioners formally approved a $1.7 billion budget with a 2.35-cent tax rate increase Tuesday night, but not without great theater – and rhetoric.
During the pre-vote debate, commissioners evoked the names of Caesar, Jesus and LBJ. Democrats chided Republicans for their inclination to “cut, cut, cut” to avoid tax hikes.
Republicans sniped at Democrats for going on a spending spree to fund their favorite programs.
Yet, after three hours, the board voted 5-4, mostly along party lines, to approve a budget molded last week during straw votes, one that resembled interim County Manager Bobbie Shields’ recommendations.
Republicans Bill James, Karen Bentley and Matthew Ridenhour voted against the budget. Chairwoman Pat Cotham, a Democrat, voted no. She said she was concerned about the impact on two groups: the thousands of residents losing unemployment benefits July 1 and senior citizens on fixed incomes facing rising costs.
She also said thousands of residents already feel cheated by the flawed 2011 revaluation.
“These are unusual circumstances,” Cotham said. “Just because we can raise taxes, doesn’t mean we should. People are struggling.”
After the vote, Democratic commissioner Trevor Fuller said the board did what it had to do, though the decision “won’t be popular with everybody.”
“I don’t expect everybody to be happy with all our decisions,” he said. “I’m not happy with all the decisions. But I’d rather make tough decisions on the front end than pay twice for that over and over again.”
Compromise or ‘gimmicks’?
As a result, living in Mecklenburg County – especially in Charlotte – will be more expensive in 2013-14.
Last week, Charlotte City Council raised property taxes by 7.25 percent. The county’s 2.35-cent tax increase – generating about $25 million – means that tax bills for Charlotte property owners with $200,000 homes will increase by $63.40 a year in additional city taxes and 47 more in county taxes.
The county budget will pay for a $19 million increase for Charlotte-Mecklenburg Schools. Other recipients of increased funding include: Central Piedmont Community College ($3.8 million); employee merit raises ($4.8 million); employee health care ($2.3 million); the tax assessor’s office ($1.8 million) and a contract for homeless services with Charlotte Housing Authority ($1.4 million).
Before the vote, Republican James offered a compromise that he said would have allowed funding for the programs “sacred” to Democrats, without a tax increase – important to Republicans and Democrat Cotham.
James said the board could cut $12 million out of the budget by deferring funding for a year to a county retiree reserve account and funding for building maintenance and buying new cars – and take an additional $14.3 million from the county’s fund balance, its savings account.
James said the board had taken a similar action in 2009 and 2010 to avoid a tax hike at the beginning of the recession.
“I thought this was the best way to balance the budget and accomplish two competing visions,” James said.
Ridenhour applauded James’ proposal as an attempt at “true bipartisanship.”
But Mecklenburg Budget Director Hyong Yi said that taking money from the fund balance would violate policy the board set – that it had to be for one-time expenses or for emergencies.
He said the board would have to change the policy to approve the proposal.
Commissioner George Dunlap called the proposal “heartless.”
Fuller said James’ efforts were “gimmicks” to build political support – like last year when the board decided to cut the tax rate by 2.44 cents “for political reasons.”
“I don’t want to pay more taxes … but we need to make tough decisions about where we need to go and what it’s going to take for us to get there,” Fuller said.
James’ proposal lost 5-4. The commissioners who voted for the budget voted against his proposal.
‘Process is upside down’
Bentley wasn’t surprised at the outcome, but she said the disagreement over the budget demonstrated why “the whole process is upside down.”
She and James want the board to set the tax rate at its January retreat and instruct the county manager to build a budget around that rate – like the board did years ago and many municipalities do now.
“I think it’s a more thoughtful process,” Bentley said. “I think it produces better dialogue.”
Dunlap said he didn’t like the idea.
“Budgets are based on the needs of our community,” he said.