As finances improve, Mecklenburg County won’t look to raise taxes

Mecklenburg County likely won’t raise property taxes next year as it continues to pay off debt, boost cash reserves and move farther away from recession-era doldrums, officials said Wednesday.

But it’s unlikely the tax rate will go down. And while commissioners praised the county’s fiscal heft in the opening day of their budget retreat, some raised concerns about economic disparities and the Charlotte area’s troubling status on economic mobility. A 2014 study found that poor children in Charlotte have the worst odds of those in any big city in America to lift themselves out of poverty.

“It’s not just a tax question,” said commissioners Chairman Trevor Fuller. “Are we doing everything we can be doing to make economic opportunity a reality for all citizens? People are really suffering in this county.”

The county is poised for a surplus and “modest revenue growth” next year as its finances improve. Last year, the county generated $1.3 billion in revenue, and so far this year has seen revenues grow by $30 million. Expenditures in 2015 were $1.3 billion – up from $1.2 billion a year earlier – but officials expect spending to drop by over a percent this year.

The news came during the county’s annual budget retreat at Central Piedmont Community College’s Harris Conference Center. Commissioners, county leaders and department heads will gather there in the next two days to start 2017 budget talks, capping with a conversation Friday about funding for Charlotte-Mecklenburg Schools.

But Wednesday, officials basked in the county’s robust finances – far removed from the sweeping cuts and employee layoffs it saw a few years earlier during the downturn.

“(The county has) healthy reserves, is (in a) good cash position and has proactive financial management,” county Finance Director Wanda Reeves told the board. “Our residents enjoy rich services.”

So rich, it’s doubtful the county will raise taxes. The property tax rate has stayed steady for the last three years, and county leaders Wednesday indicated no plans to reverse course. Commissioner Pat Cotham, who said she’s heard from senior citizens looking for relief in their wallets, asked whether the county would lower taxes.

Cutting taxes may not yield huge savings for taxpayers, as an even 1-cent reduction in the tax rate equates to about $100 in savings, Diorio said, and that “doesn’t buy anything.”

Talk of taxes gave way to conversations about economic opportunity for the county’s poorest residents. Several incumbents on the board are seeking re-election this year, and five face challengers in the March 15 primary.

“If it’s true that we do have resources, then one may fairly ask whether we are properly using those resources when we have them to benefit everybody in this community,” Fuller said.

Economic mobility has become a banner issue for commissioners over the last year after the 2014 study.

The county formed a 20-member opportunity task force to study and issue recommendations to reduce the disparities. The group hopes to release findings in October.

Fuller, who called for the task force’s creation, said “it’s clear the (county’s) prosperity is not getting to everybody. That has a direct impact on our economic performance.”

Commissioner Jim Puckett said enhancing economic opportunity for residents comes from jobs in the private sector, not government spending.

“I would say, at some point, we start looking at tax rates and how they may limit private sector growth,” he said. “We need to make sure that we are competitive with our costs in the free market, too. That’s how you’re going to take care of upward mobility: Generate greater private sector jobs.”

A flat tax rate alone won’t boost wealth, but a stronger focus on education and access to health care could make a difference, Fuller said.

“We’ve got an underbelly, and we better deal with it because we’ll find out that this prosperity has been built on sand if we don’t address economic opportunity,” he said.

This story was originally published January 27, 2016 at 7:09 PM with the headline "As finances improve, Mecklenburg County won’t look to raise taxes."