The Inside Scoop – By Tara Lightner Robbins

 

May 2013 – Issue

REALTORS^®: This newsletter is designed to provide you with an update of important real estate issues and political activities. 

 

Cary Budget Feels Pinch of Water Treatment Plant Expansion

Town Manager Ben Shivar recognized the challenges of balancing current needs with the constraints of limited revenues. His proposed budget of $304 million includes a 2 cent property tax increase which was part of the community Investment Bond package approved by voters in November. Residents will also see a $1 increase in solid waste fees and new housing costs will bear a 5% increase in building permit fees. Building permit fees have remained unchanged for over a decade. The budget holds operational new spending to only 3%, while the $102 million Capital side of the budget includes a $66.4 million expenditure to pay for the water treatment plant expansion.  For more details about the Cary Proposed budget visit www.TownofCary.org

 

Raleigh Budget Overview

Outgoing City Manager Russell Allen presented the Council with a $705.2 million Capital and Operational budget which is 4.9% higher than the current year budget. No changes in the property tax rate, storm water fees or solid waste fees are proposed but a $13.9 million increase in revenues for Public Utilities will have a small impact on sewer customers in Raleigh as they realize a 14% increase in sewer volume rates. Raleigh’s Public Utilities department has been undergoing a program assessing their aging water and sewer infrastructure in the older areas of the city and the costs of replacement and repair are staggering. Sound fiscal management over the years has rewarded Raleigh, Cary and Wake County with high credit ratings which allow for very low interest rates on financing their projects. For more information about Raleigh’s proposed budget visit: www.raleighnc.gov

 

Wake County Budget 

Recession busting indicators allow for a little breathing room in the 2014 Wake County Manager’s proposed budget. County unemployment down, Sales Tax Revenue up, Property Tax Revenue up, New Residential building permits up, and Property Tax Revenues are up.  Proposed Manager’s budget is $982.8 million – maintains the property tax rate of 53.4 cents. This represents an increase of $44.3 million over the adopted 2013 budget of $938.5 million. In the Public Education Arena, Wake Tech funding remains static at $16.2 million while the Wake County Public Schools would receive an additional $9.2 million over last years budget. The Sheriff’s office would receive an increase over last year’s budget of $3.8 million and EMS would get a bump of $3.5 million. The Environmental Services Division will see an increase of about $500,000 to complete the digitizing of septic permits and hire a FTE to specifically address groundwater/well contamination concerns. For more details about the budget, visit www.wakegov.com

 

Education Matters:

 

K-12: Status of a Construction Bond for Wake County

The Wake County School Board proposed a $940 million building plan to the Wake County Commissioners but no agreement has been met. The plan which would deliver about 20,000 new seats to meet a 2017 projection of over 19,000 new students. The plan includes 16 new schools, major renovations at 6 existing schools and various other projects. County finance staff estimated the need for an $810 million bond and nearly $130 in cash to cover all projects. If approved the plan would trigger a property tax increase of over 5 cents, or roughly $145 for the average $263,000 home. The school and county boards remain tense as legislative initiatives progress that would change ownership of school facilities.  

 

Food for Thought: Community Colleges and High School Standards

In Context, An electronic publication of the Wake Education Partnership, recently discussed a study that sheds light on the needs of job-seekers and the standards taught in our public schools. The study funded by the Bill & Melinda Gates Foundation suggests that students in high school spend too much learning what they won’t ever use, not enough time learning what they need, and don’t master content that actually matters. Although no colleges included in the study were named, NC Community College System President, Scott Ralls called the findings, “entirely consistent’ with reports from faculty thought the state.  

 

NC General Assembly Update: (from the NCAR Government Affairs Update)

House Bills

Senate Bills

Tax Reform

While the Senate Majority Leadership has still not released any comprehensive legislation explaining their tax reform proposal, the House leadership,  tired of waiting,  released their proposal Tax Simplification and Reduction Act in House Bill 988 on Thursday.

 

The House proposal does the following:

Reduces the individual income tax rate to a flat rate of 5.9; Itemized deductions are retained for home-mortgage interest and charitable contributions BUT are capped at $12,500 to $25,000, depending on filing status. Taxpayers claiming the standard deduction would no longer be allowed to claim a credit for charitable contributions; the $100 per-child tax credit increases to $250 for most filers, $125 for the highest wage earners; Corporate Income Taxes would be reduced to 6.75%; Business franchise tax rate of $1.50 per $1,000 would be decreased and not expanded to subject limited liability companies to franchise taxes; The House would preserve film production incentives and other low-income housing and R&D credits; and sales tax is reduced to a combined sales tax to 6.65 percent. Sales taxes would be expanded to cover warranties and service contracts and installation, repair and maintenance of tangible personal property, including personal automobiles. The sales tax exemption for nonprofit groups and prescription drugs and the exemption on the state's portion of the sales tax on food all would remain in place.

The House will consider their proposal in the House Finance Committee as early as May 28th.

 

The Budget Process for the General Assembly

The Senate released an approximate $20.4 Billion budget for the next two years. The bill, among many other things, included approximately $8.5 million for the Housing Trust Fund, made changes to several boards and commissions, increased the fees for lobbying and principal registration with the Secretary of State, and re-allotted 1% of the Deed Stamp Tax to the general fund from the Parks and Recreation and Natural Heritage Trust Funds. There were many other provisions including policy provisions that create a statewide water infrastructure authority and change the A-F grading policies of our NC schools.

Senate Appropriations Subcommittees will begin meeting on Monday, May 20th to discuss details and then the legislation would go to the full Senate Floor for voting before heading to the House. The House will take up the Senate Budget, make their change and then a conference committee will need to be established to hammer out the differences. This must be completed before June 30^th.

 

A special thanks to Diana Braun for her support and fundraising efforts on behalf of RPAC! Congratulations also to Mary Edna Williams, Brenda Carroll, Mollie Owen, Van Fletcher, and Linda Craft who became RPAC Major Donors at the May 9th Elite REALTOR Party at the Bob Ingram Porsche Collection in Durham.