Chapel Hill resident Mark Zimmermann does a great job of explaining why Orange County’s property tax rate rose steadily and rapidly for years. The rate now stands at 99.8 cents per $100. No, it wasn’t some grand, involved fiscal calculation by county commissioners, writes Zimmermann in the Chapel Hill News.
It was about psychology.
Each spring, the commissioners wrangle over a budget. At the end, their spending decisions determine if a tax rate increase is needed. For decades, the process went on unchecked. Spending was debated, added up, and a new tax rate increase was calculated to pay for it.
Until last year, when the increase bumped up against a psychological barrier — $1 per $100 — one of the highest in the state.
The manager’s proposed budget increased the tax rate to $1.04. Four of the five commissioners went on record saying they wouldn’t support a budget that resulted in a tax rate higher than $1. So the county sharpened its pencils, cut proposals and reduced the increase (yes, there still was one) to 99.8 cents, halving the manager’s requested increase.
Suddenly we had a governor on the process.
Zimmermann then makes the case that if commissioners lower the rate to a revenue-neutral position of 82 cents per $100 to account for increased property values due to the recent revaluation, the $1 psychological barrier will disappear and “the same unbridled process” will ensue.
He’s right. But I don’t think you can discount the underlying mindset of the Orange commissioners that government is the answer to any and all needs and wants. It is to be expected that spending will grow due to inflation and population growth. But in Orange County, spending grew much more rapidly, as the Locke Foundation’s Michael Sanera and Joe Coletti illlustrate in this Regional Brief.
Check out the chart on Orange County on page 17 of the report file. It shows that by fiscal year 2007, an Orange County family of four needed an additional $1,543 in income to keep up with the growth in county revenue over the past five years.
