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Published: Apr 27, 2008 10:37 AM
Modified: Apr 27, 2008 10:37 AM

Sharing the burden
 
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The magnitude and nature of much of the organized opposition to the proposed Orange County land-transfer tax frankly makes us wish we were more inclined to support it.

The statewide real estate industry association has launched an all-out assault on the tax proposal and has pumped money into the fight hand over fist. The opposition organization, the quaintly named Citizens for a Better Orange County, has used telephone robo-calls, mass mailings, TV commercials, road signs, you name it, all to quash what they disingenuously call the "home tax."

The Orange County Board of Commissioners, meanwhile, isn't allowed to advocate for the tax. But it is spending $100,000 on a campaign to educate voters about the proposal. The hope there is that if the voters are educated enough, they will vote for it.

A lot of prominent progressives and local elected officials back the tax, and a true grassroots group, Orange Citizens for Schools and Parks, has sprung up to support it.

Amid the din of all those strenuous voices, it's hard to think straight. So, to recap, the measure would impose a 0.4 percent tax on the seller in any real estate property transaction in which money changes hands (transfers by inheritance or gift would not be subject). It would apply not just to sales of homes, but also to sales of land, commercial property and so on.

The tax is estimated to generate about $3.5 million in the first year. The commissioners have resolved to use the money for schools and parks. They say the transfer tax would help offset the need for larger increases in the overall property tax rate.

It's a tough call. The most compelling argument for the transfer tax is that by helping forestall property tax hikes, it would provide the most significant benefit to those homeowners who need it most, lower income ones. That argument rests on several assumptions, not the least of which is that the transfer tax really would have an appreciable effect in reining in future property tax increases.

Many very smart and conscientious people around here believe that it will, and that the transfer tax is the best available way to get the most gain for the least pain.

From our perspective, even if that assumption holds up, it's outweighed by a fairness issue. Schools and parks benefit all the citizens of Orange County, and the burden of paying for those needs should be spread out among all of us rather than laying it on the shoulders of one small slice of the population.

It's odd, too, that the tax targets the seller, rather than the buyer. If the idea, as we so often hear, is to "make growth pay for itself," then surely it's the party moving in -- the buyer -- that is responsible for whatever "growth" is happening. If you decide to sell your house here and move to Florida, it hardly seems right to be required to pay up on your way out the door, to pay for schools and parks you'll never use.

If we can't afford the growth the county is experiencing, we'd be better off taking measures to either slow it down or focus our revenue-generating strategy more narrowly on new development. There has to be a better way than putting the burden of paying for countywide needs on a handful of residents, including those who are leaving the county and will no longer require its services.


If you have a comment on today's editorial, please contact Dave Hart, associate editor, at 932-8744 or dhart@nando.com.
2008 The Chapel Hill News
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