If you felt a chill run up your checkbook last week in Charlotte, we understand.
The Mecklenburg Board of Commissioners held its annual budget retreat Wednesday and Thursday at a Greensboro resort that was a little too posh for officials who were there to talk about the public’s money. On the agenda was taxes — specifically, property taxes that might be going up for a lot of us, thanks to a county-wide revaluation that’s raising residential values an average of 43 percent and commercial values a whopping 77 percent.
Those numbers don’t necessarily mean taxes are rising. Commissioners have the opportunity to make the property tax rate “revenue neutral,” which means the county would take in the same amount of money as the last budget. But, said board chair George Dunlap on Thursday: “The likelihood of a revenue neutral tax rate is slim to none.”
Why? The new, all-Democratic board has some big ambitions. Commissioners want to give Charlotte-Mecklenburg Schools more money, and they want universal pre-K in Mecklenburg. The board also wants to do its part tackling Charlotte’s affordable housing problems, and it wants to move forward more quickly on greenway funding.
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If commissioners want all those things with a revenue neutral tax rate — “As momma said, you need a wake up call,” Dunlap said.
Added commissioner Trevor Fuller: “I don’t want to pay more taxes. No one does. But I know for the common good, my contribution is part of my citizenship.”
To be sure, if we want better things for our community — and the board’s wish list is worthy — we have to pay for them. But we don’t have to tackle all of them at once if the resulting tax hike is unbearable for many residents. Democrats seem poised to push for significant tax increases — Dunlap warned wavering commissioners to have “political will” on taxes. The tax implications of such spending comes with some natural consequences.
That includes new burdens on homeowners with fixed incomes, especially those in gentrifying neighborhoods where property values have risen and will spike even more. Residential and commercial renters also will be pinched as property owners pass on tax increases (many commercial leases are structured for taxes to be a pass-through expense). For at least some small businesses, the resulting spike in overhead could make tight margins unsustainable.
Another byproduct: Affordable housing could become even scarcer in Charlotte as homeowners sell and renters flee. If middle class taxpayers also cross the border to less expensive counties, Charlotte could accelerate down the path of other metro areas, becoming a city of the very wealthy and very poor.
We hope and expect the board to find a responsible balance that accounts for the genuine sticker shock revaluation brought residents this past week. We were encouraged by vice chair Elaine Powell’s reticence about raising tax rates above revenue neutral, and we agree with her call for clarity about how much taxes might increase. That should include transparency about revenues already on hand thanks in part to a .75 cent property tax increase the board levied last year, the first such increase in five years.
Mecklenburg has urgent needs and, as always, decisions to make about how to meet them. The board should be both progressive and prudent moving forward.