New taxes hurt chances of growth


To the editor:

The Person County manager recommended a property tax increase of $.02/$100. This represents a .02/.7 or 2.8 percent increase for rural and a .02/1.37 or 1.5 percent increase for city residents (fire taxes not included in these figures).

Person County’s hopes of growing its population and its tax base rest on the potential of attracting industry and on the possibility of escaping the economic calcification the EPA and the North Carolina state legislature have imposed on it. There is little to attract new families to Person County besides its natural beauty, and even less with increased taxes. Families can’t subsist on rural scenery. They need jobs. The county is not growing and is much poorer than the counties for which Person is essentially an unremunerated pollution easement or a grantor of pollution “indulgences” of sorts held to offset virtually unabated development taking place in and around RTP.

Monday night Person County commissioners further disincentivized economic development here more than ever. If the goal was to channel yet more potential development and more tax revenues into Wake, Durham and nearby counties, then this property tax increase is another step toward achieving it.

For poorer single renters not living in government housing, the tax represents a trip to the drug store every month and brings the portion of the rent payable to property taxes to an almost absurd level. For a $600/mo rental property worth $125,000, the portion of rent that must go to property taxes is now $144.79 or 24 percent of the rent payment. Realistically however, such rentals are not and probably will not be worth that much since property improvements wouldn’t yield enough extra rent to fully cover the additional taxes incurred. The result will be to undermaintain lower rent properties, to postpone or attenuate capital improvements or to just sell them. These effects apply to other categories of housing as well, manifesting as decreased housing quality and supply and increased rents and escrow payments. Ultimately, the dynamic will tend to nudge more renters into government housing instead. That would be an unfortunate effect.

County tax revenues must flow from sustainable economic growth rather than tax rate increases or the tax base will simply evaporate anyway as working residents age and retire or die. The new rates will decrease property values, reducing them in the net if nothing else increases them simultaneously, like demand for housing and services fueled by actual population growth and jobs.

Dave Jeffreys



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