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Published: May 17, 2008 02:29 PM
Modified: May 17, 2008 02:29 PM

Citizen's e-mail draws quick reply
Chapel Hill officials respond to query about proposed tax increase
 
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CHAPEL HILL -- Frank Tew gets quick government service.

When he e-mailed the town, alarmed by its proposed 11 percent tax-rate increase, he got a response from Mayor Kevin Foy 28 minutes later.

"I understand the need to keep taxes at a reasonable level," the mayor said. "However, I think when you look at the reality, the town provides excellent services at a reasonable cost."

Tew wrote after reading an article in the May 8 edition of The Wall Street Journal that compared housing costs in three college towns.

On a roughly $400,00 house, a Cambridge, Mass., homeowner paid $1,094 in taxes, a Boulder, Col., owner paid $2,078 in taxes and a Chapel Hill owner, $5,026.

"Property in Chapel Hill is expensive and the property taxes are too high already," Tew wrote. "Please rethink your approach to the Chapel Hill budget."

In his e-mail, Foy noted that Chapel Hill's portion of that $5,000 bill would be about $2,100. The lion's share would be the county tax, with the rest the special district tax to support the city schools.

For their town tax, local residents get a lot, the mayor continued: police, fire protection, parks, garbage pick-up and free bus service.

The town didn't raise taxes the past two years, Foy said. This year's proposed increase is high because bills are due for the new aquatics center on Homestead Road and the $50-plus million Town Operations Center, which the town had to build when UNC wanted its land back for Carolina North.

Town Manager Roger Stancil also responded to Tew. His budget director noted two things missing from the Journal article.

First, you get a lot more house for your money in Chapel Hill, nearly twice the square footage based on real estate listings.

Second, Cambridge and Boulder have different tax structures from Chapel Hill. Harvard and MIT are among Cambridge's top 10 taxpayers. Boulder has an admissions tax and other taxes not available to Chapel Hill.

The bottom line? Both communities can afford to keep their local property tax rates down.

Chapel Hill Town Council Member Ed Harrison had an intern study tax rates of the state's 25 largest towns and cities.

The study found Carrboro had the highest municipal tax rate, followed by Greensboro and High Point. Chapel Hill ranked 12th.

When town and county taxes were ranked as a combined total, however, Chapel Hill shot up to second.

For Harrison the message was clear.

"The tax burden is coming from another government," he said. "We have very high county taxes as a percentage of the total tax bill."

But not everyone is convinced the town is doing enough to keep its share of the tax bill down.

Gene Pease, an entrepreneur, chaired an advisory committee that looked at the budget process three years ago when the town faced a similar increase.

His committee made several recommendations. The one that got the most attention was a proposal to sell the old library building on East Franklin Street and move the museum into the post office building. The town could have made $2 million to $3 million, he said.

"They didn't take any of our big ideas," Pease said. "(But) the budget increase ended up half what they expected it to be, and I think a lot that was the pressure we put on them to hold down costs."


Contact staff writer Mark Schultz at 932-2003 or mark.schultz@nando.com
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