Here’s another non-surprise. Mecklenburg County staff wants no part of selling off assets to close the county’s budget gap. Once again budget director Hyong Yi is the locus of nonsense.
Budget director Hyong Yi said the county doesn’t have enough property to sell to solve its budget woes, which he expects to continue for two to five more years. “It’s not a sustainable strategy,” he said.
That’s crazy talk. It is totally sustainable because you are transforming a liability into an asset; a tax-eater into a tax-producer.
The county values the 142-acre Cedarwood Golf Club in South Charlotte at $7.2m. and collects $61K a year in property tax revenue from it, the city gets about $33K a year. Were the 160-acre county-owned Sunset Hills golf course to be sold for $5m. it would start throwing off at least $65K in local property tax money. At the same time, the county stops paying for upkeep of the property.
Interestingly, the county has saved some $600K in annual upkeep costs by privatizing the management of its five county-owned golf courses, a move which was evidently sustainable enough for Yi to undertake. But still the county will only take in $230K in fee revenue from the courses while spending $343K on them, for a loss of $113K. What county officials are eye-balling, however, it that revenue bounces back up to pre-recession levels. Profit.
Yet this kind of thinking misses the time-value of taking several million dollars today and using it to pay down the county’s massive debt burden. Expect more resistance on this asset sale point. County staff simply likes to control hundreds of acres of land, golf courses or not.
