Wic omic o County R Wic omic o County R e ve nue Cap e ve nue - PowerPoint PPT Presentation

Wic omic o County R Wic omic o County R e ve nue Cap e ve nue Cap De ve lo pe d By: T De ve lo pe d By: T he Gre ate r Salisbury Co mmitte e he Gre ate r Salisbury Co mmitte e Data Co lle c tio n and Analysis Pro vide d By: BE Data Co lle c tio n and Analysis Pro vide d By: BE ACON at Salisbury Unive rsity ACON at Salisbury Unive rsity

What is the R What is the R e ve nue Cap? e ve nue Cap?  L  L imits the County’s r imits the County’s r e ve nue fr e ve nue fr om r om r e al pr e al pr ope r ope r ty taxe s ty taxe s  T  T he Co unty’ s re ve nue c an inc re ase by 2% fro m the pre vio us ye ar o r the CPI he Co unty’ s re ve nue c an inc re ase by 2% fro m the pre vio us ye ar o r the CPI -U rate -U rate  T  T he max re ve nue inc re ase is the minimum be twe e n CPI he max re ve nue inc re ase is the minimum be twe e n CPI -U and 2% -U and 2%  Whe n re al e state value s de c re ase , the pro pe rty tax rate c an inc re ase . Whe n re al e state  Whe n re al e state value s de c re ase , the pro pe rty tax rate c an inc re ase . Whe n re al e state value s inc re ase , the pro pe rty tax rate c an de c re ase value s inc re ase , the pro pe rty tax rate c an de c re ase  T  T he o bje c tive o f the re ve nue c ap is to limit waste ful g o ve rnme nt spe nding and e liminate he o bje c tive o f the re ve nue c ap is to limit waste ful g o ve rnme nt spe nding and e liminate une xpe c te d larg e tax inc re ase s une xpe c te d larg e tax inc re ase s

R R e ve nue Cap Challe nge s e ve nue Cap Challe nge s  T  T he c ap o nly wo rks in an e nviro nme nt whe re inflatio n is 2% o r le ss he c ap o nly wo rks in an e nviro nme nt whe re inflatio n is 2% o r le ss  T  T he lang uag e o f the c ap make s Co unty re ve nue s fall be hind the to tal allo wable re ve nue . he lang uag e o f the c ap make s Co unty re ve nue s fall be hind the to tal allo wable re ve nue .  T  T he CPI he CPI -U rate is no t an ac c urate me asure o f the rate o f c hang e in lo c al g o ve rnme nt -U rate is no t an ac c urate me asure o f the rate o f c hang e in lo c al g o ve rnme nt e xpe nditure s. e xpe nditure s.  T  T he re ve nue c ap is no t de sig ne d to ac c o mmo date unfunde d state o r fe de ral mandate s he re ve nue c ap is no t de sig ne d to ac c o mmo date unfunde d state o r fe de ral mandate s  T  T he re ve nue c ap do e s no t have an e me rg e nc y c o nting e nc y pro visio n to allo w e le c te d he re ve nue c ap do e s no t have an e me rg e nc y c o nting e nc y pro visio n to allo w e le c te d o ffic ials to addre ss e xtrao rdinary budg e tary de mands in c ase s o f disaste rs o r majo r o ffic ials to addre ss e xtrao rdinary budg e tary de mands in c ase s o f disaste rs o r majo r e c o no mic disruptio ns e c o no mic disruptio ns

E E ffe c ts on R ffe c ts on R e ve nue e ve nue  T  T he County has be e n unable to c olle c t and use ove r he County has be e n unable to c olle c t and use ove r $15 million dollar $15 million dollar s fr s fr om om 2006-2016 2006-2016  CPI  CPI -U has be e n hig he r than 2% o ve r the last 10 ye ars -U has be e n hig he r than 2% o ve r the last 10 ye ars  Sho uld this c o ntinue to o c c ur, the Co unty will c o ntinue to lo se o ut o n millio ns o f  Sho uld this c o ntinue to o c c ur, the Co unty will c o ntinue to lo se o ut o n millio ns o f do llars at a faste r rate o n a ye ar-to -ye ar basis. do llars at a faste r rate o n a ye ar-to -ye ar basis.  48% o f the Co unty’ s re ve nue is fro m lo c al pro pe rty taxe s  48% o f the Co unty’ s re ve nue is fro m lo c al pro pe rty taxe s  T  T he Co unty’ s re ve nue is use d to fund public se rvic e s (e duc atio n, public he alth he Co unty’ s re ve nue is use d to fund public se rvic e s (e duc atio n, public he alth and safe ty, fac ilitie s, e tc .) and safe ty, fac ilitie s, e tc .)

E E ffe c ts on T ffe c ts on T axe s axe s  Due to pr  Due to pr e vious tax inc r e vious tax inc r e ase s be low the c ap, the c ur e ase s be low the c ap, the c ur r r e nt taxe s ar e nt taxe s ar e be low pr e be low pr ior ior le ve ls whe n adjuste d for le ve ls whe n adjuste d for inflation inflation  I  I f the c urre nt tax rate is inc re ase d by 6%, the o wne r o f a me dian value ho me in f the c urre nt tax rate is inc re ase d by 6%, the o wne r o f a me dian value ho me in the Co unty ($172,400) wo uld o nly pay $99 mo re that ye ar in pro pe rty taxe s the Co unty ($172,400) wo uld o nly pay $99 mo re that ye ar in pro pe rty taxe s  Co mpare this to having a 16o z c o ffe e fro m Starbuc ks 3x pe r we e k:  Co mpare this to having a 16o z c o ffe e fro m Starbuc ks 3x pe r we e k:  1 ye ar c o sts = $612  1 ye ar c o sts = $612  T  T he inc re ase s in pro pe rty taxe s c o lle c te d c o uld be use d to impro ve ro ads, he inc re ase s in pro pe rty taxe s c o lle c te d c o uld be use d to impro ve ro ads, e duc atio nal se rvic e s, building s, and o the r public se rvic e s use d by re side nts e duc atio nal se rvic e s, building s, and o the r public se rvic e s use d by re side nts  I  I nc re ase s in pro pe rty taxe s c an also pro vide c ushio n fo r the Co unty ag ainst nc re ase s in pro pe rty taxe s c an also pro vide c ushio n fo r the Co unty ag ainst re c e ssio ns that will limit public se rvic e s to re side nts re c e ssio ns that will limit public se rvic e s to re side nts

Options Moving F Options Moving F or or war war d d  Chang e the lang uag e o f the c ap to be able to take the hig he r o f CPI  Chang e the lang uag e o f the c ap to be able to take the hig he r o f CPI -U o r 2% e ac h ye ar -U o r 2% e ac h ye ar  Using a diffe re nt inflatio n inde x (S&L  Using a diffe re nt inflatio n inde x (S&L I I PD) inste ad o f the CPI PD) inste ad o f the CPI -U inde x -U inde x  I  I mple me nt a safe ty valve whic h allo ws fle xibility to c ap limits in c ase o f drastic e c o no mic mple me nt a safe ty valve whic h allo ws fle xibility to c ap limits in c ase o f drastic e c o no mic c hang e s. T c hang e s. T ypic ally re quire s a majo rity vo te e ithe r by the public o r pre -de te rmine d bo ard. ypic ally re quire s a majo rity vo te e ithe r by the public o r pre -de te rmine d bo ard.  Using ho me ste ad e xe mptio ns (save o n taxe s o n a pe rso n’ s ho me ) o r c irc uit bre ake r  Using ho me ste ad e xe mptio ns (save o n taxe s o n a pe rso n’ s ho me ) o r c irc uit bre ake r pro g rams (be ne fits to taxpaye rs, with be ne fits inc re asing as inc o me s de c line ) pro g rams (be ne fits to taxpaye rs, with be ne fits inc re asing as inc o me s de c line )  I  I mple me nt a sunse t/ re se t c lause whic h will auto matic ally te rminate the c ap afte r a fixe d mple me nt a sunse t/ re se t c lause whic h will auto matic ally te rminate the c ap afte r a fixe d time pe rio d unle ss it is e xte nde d. time pe rio d unle ss it is e xte nde d.  E  E liminatio n o f the re ve nue c ap? liminatio n o f the re ve nue c ap?