They say the bill should clearly state what the money would be spent for. There has been a general understanding the money would go for public land-acquisition, but the bill introduced last year does not say that. It should.
Land-acquisition is a public investment that can pay off in many ways. Sometimes the land can be used for parks, fire stations, libraries, clinics or public access to the waterways. But those benefits should not confuse the issue. The real estate transfer fee should not be expected to fund all those capital improvements. It should be for land acquisition.
Look at the accommodations tax on overnight lodging -- which is itself supposed to have clearly defined uses in the law -- to see how confusing things can get when a pot of discretionary funds are open to the public. The real estate transfer fee needs a simple, clear purpose stated in the law.
It has also been suggested that the law pinpoint the rate of the fee, limiting it to .25 percent of the sales price of a property. That, too, is a good idea. But the bill should enable local governments to set a lower fee if they want to. The .25 percent fee was set for the Town of Hilton Head Island's land-acquisition program after consultation with Realtors and builders. That type of input in other towns might lead to a different bottom line.
Local builders are also calling for the bill to have concise definitions of accountability on how the money is spent. That could best be done by placing the accountability squarely in the lap of the elected council of the local government levying the tax. It should rest with town councils and county councils, not legislative delegations, as Herbkersman's bill proposes.
Putting the legislative delegation in the mix is the quickest way to blur accountability. That would pass accountability for local spending to people who might not even live in the town or county using the money -- and perhaps not even voted on by those residents.
But Bluffton Mayor Hank Johnston told us this week he has no qualms with the legislative delegation being involved because it might be the only way some legislators would approve the bill.
The old bill has one other problem. It was written to include only Beaufort County municipalities. The law should also include the Beaufort County government, and to be constitutional it should apply statewide, not to a single county.
The good of a real estate transfer fee clearly outweighs the bad. The suggestions from builders and Realtors should be taken seriously, and the local option to enable public land acquisition should be available statewide.