The Price of Liberty is Eternal Vigilance
Shrimp n' Grits
A Rising Tax Jolts Joe’s VotesLee Walton
For those who may have missed the similarity, there is an old political cliché that claims, “A rising tide floats all boats”. For Charleston’s too long serving mayor, this year, and particularly, the City Administration’s upcoming budget for Fiscal Year 2011, may be the greatest financial and political challenges that J. Pericles Riley has faced in his nearly four-decade tenure as Mayor and chief executive officer of Charleston. Notwithstanding Charleston’s main engines of economic growth and expansion as the now all-to-lame two-trick pony of tourism and sustainable construction in the commercial and residential sectors, Charleston’s primary revenue generating resources of property and sales/consumption based taxes are being pummeled by the continuing recession and lack of meaningful economic rebound so hoped for by the smoke generators and lever pullers in City Hall.
Hot on the heals of these latest unintended consequences of the current world-wide recession inflicted upon one consistently hypnotized by self-induced hyperbole and blinded by self-aggrandizement is a pending bill in the state legislature that would force a municipal millage increase in next year’s City budget to off-set real property tax losses resulting from a legislative cap on the current practice of point-of-sale reassessment to full value when residential properties are sold.
The current City budget includes approximately $51 million in property taxes, which constitute about 41% of all anticipated operating revenues for the current fiscal year. The projected real property tax revenue component of these anticipated property taxes includes approximately 4% in anticipated growth in the total assessed value of all real property within the City subject to taxation. Given the total absence of both residential and commercial construction prevailing throughout the southeast in general and the Lowcountry in particular, the City’s budget makers are depending heavily upon the point-of-sale reassessment as the only meaningful factor to provide taxable growth in the City’s real property tax base. Without the point-of-sale reassessment in the current economic malaise, there would be little or no meaningful taxable growth in the total assessed value of all properties within the City. An unavoidable shortfall in real property tax revenue would necessitate a millage increase on all real property in this fall’s City budget to recoup the loss – a cruel necessity to “float all boats” to generate the necessary tax revenue.
Pericles is all too aware of what a dangerous “tea party” voter back-lash to a millage increase and higher property taxes this fall could do to his re-election campaign in 2011. That’s why he’s secretly arm-twisting and intimidating every real estate agent and state legislator he can to stop the current legislation now being considered to place a percentage cap on the point-of-sale reassessment that many say has wrought near total devastation upon economic growth and residential construction throughout the state since its enactment in 2006.
The following months promise to be politically entertaining, if nothing else. The hand wringing, squeaky shrills, and arm flailing emanating from City Hall will surely be entertaining, particularly for those lining up to give Pericles a run for every dime he can raise in 2011 from his stable of loyal liberal, ultra-left wing sycophants and deal-estate cronies. Let the games begin!