Tuesday, 09 June 2020 21:08

Dobbins Heights to raise tax rate for first time since its charter

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The Dobbins Heights Town Council voted to accept the budget for the next fiscal year, which includes a property tax increase. The budget will be available for review the next two weeks before the council adopts it. The Dobbins Heights Town Council voted to accept the budget for the next fiscal year, which includes a property tax increase. The budget will be available for review the next two weeks before the council adopts it. William R. Toler - Richmond Observer

DOBBINS HEIGHTS — Richmond County's newest municipality will have raise its property tax for the first time ever.

The Dobbins Heights Town Council voted Tuesday to approve the proposed budget for the next fiscal year, which included raising the tax rate to $0.60 per $100 of valuation.

Town officials say the rate has been $0.50 since Dobbins Heights was chartered in 1984.

Mayor Pro Tem Tyre' Holloway, who sat in for Mayor Antonio Blue, said the increase was a direct result of the Richmond County Board of Commissioners' April decision to switch the method of distributing sales tax reveunes from per capita to ad valorem.

"Had that not happened, we would have been able to not raise taxes," Holloway said.

The town's population is approximately 866 residents, with all the property valued at $13.4 million.

Nearly a third of the town's $315,937.88 budget ($100,000) is expected to be paid from local sales taxes, with another $83,000 from the current year's real estate taxes and $19,570.56 from the previous year's  property taxes.

Dobbins Heights has had issues with property tax collection in the past.

Collection has improved over the past six years, but although the collection rate has been "incrementally increasing," according to the budget message it is still only 77.94%

Holloway said when he was first elected to the board, the collection rate was around 62%.

"We got it raised 15 percentage points and we'd love to do more, but with this tax increase ... it's going to hamstring us," he said. 

"It's not fair to the taxpayers to have to pay this increase due to the management of the county," Holloway continued. "It seems like we've worked hard to get our  tax (collection)rate increased, and we're getting it there ... now it's like, 'Thank you for paying your taxes, now we've got to increase them.'

"It's not our doing," he said. "We were forced to do this just to maintain solvency."

That was a huge concern of Rockingham City Manager Monty Crump, who contacted the N.C. Department of Revenue for estimates on what each municipality would lose from the change.

Using figures from 2018-2019, NCDOR estimates that Dobbins Heights will be out nearly 79% of its sales tax allotment from the change. Norman was estimated to lose 100% of its sales tax revenue, Hoffman would lose more than 85%, and Ellerbe’s share would be decreased by more than 55%. 

Holloway urges residents to petition the county commissioners to reconsider the dispursement change.

"At least give us more time to deal with it," he said.

Municipal leaders were caught off guard following the April vote, saying the county had not given them a heads up, which left them scrambling to alter their budgets.

If they had been given more time, Holloway says his town could have handled the situation more effectively.

One of the largest expenditures Dobbins Heights had to slash from the budget was the town pool.

While the opening of the pool was delayed due to COVID-19 restrictions, but because of the sales-tax switch, it won't be able to open at all, Holloway said.

"That's our big kicker for our community and the surrounding communities, because the whole county untilizes our pool," he said. "That's going to hurt ... not just us ... (but) that's one of those measures that we had to take."

The town's annual winter sleigh ride, which has been an attraction for several years, was also cut.

Holloway did say the town is still currently planning to have its trunk-or-treat event, since its more community-sponsored.

The town also looked at cutting hours and wages for its employees, but Holloway said the council figured out a way where it wouldn't have to.

With the pool being closed, the town will save money by not having to pay a pool attendant and lifeguard.

"It's going to be very difficult going forward into this fiscal year," he said. "But we've got a budget and we've got it balanced and we're going to work to maintain its balance."

Under expenditures, the town plans to spend:

  • $23,900.10 on the governing body
  • $138,623.64 on administration
  • $30,000 on public safety
  • $21,026.15 on sanitation
  • $11,863 on utilities
  • $$25,311.28 on streets
  • $65,213.52 on parks and recreation.

The town also expects to collect: $14,076.61 in vehicle taxes; $22,284 in Powell Bill funds for the streets; $25,000 in rents and concessions; $17, 982.30 from the franchise untilities tax; $3,500 from the alcoholic beverage tax; $1,747.50 from sales tax return; $4541.07 from auctions; $8,259.44 from penalties, interest and advertising; $2,535.50 from interest on investments; $4,071.07 from miscellanous revenue; and $8,618.66 from its fund balance.

The town's budget will be on display availabe for review at the Dobbins Heights Town Hall until Tuesday June 23, when it is slated to be adopted following a public hearing at 4:30 p.m.

Holloway again urged the commissioners to reconsider, look at the numbers again, and sit down with the municipalities to come up with a compromise.

"Because when we have to cut and the county doesn't cut, how fair is that?"