Property tax reform might not sound
glamorous, but for York County, plans being argued in the state
Legislature could mean big changes for local schools, government and
many property owners.
Under the new system, the state would pay for public education and
decide how much money each county would get for its schools. The details
of that distribution haven't been worked out.
The York County Regional Chamber of Commerce is hosting a forum
Monday night to explain the impact of the proposals.
• How will this affect York County homeowners?
This year is the county's reassessment year, which means the county
is refiguring how much each piece of property is worth. It also means
higher property tax bills in December because property values in many
parts of York County have risen dramatically.
For homeowners who've had the same house for the past five years,
particularly in the fast-growing areas around Fort Mill and Lake Wylie,
the increases could be staggering.
Such increases are just what the state House and Senate proposals aim
to avoid, supporters say.
Local property taxes could be eliminated and the money replaced by
raising the state sales tax from 5 percent to 7 percent, under the
proposals.
The sales tax would be distributed by the state, and it isn't clear
how much money York County would get back.
• What would the sales tax be in York County?
The state sales tax would be raised from 5 cents to 7 cents per
dollar. York County would have an additional cent for about five more
years because of the Pennies for Progress program. So, 8 cents per
dollar.
• What makes York County special?
We're near the North Carolina border, and that creates some unusual
issues. If the state lowers or gets rid of property taxes in York
County, it could attract a massive influx of families. That could put a
serious strain on the already overcrowded Fort Mill school district.
Rapid residential growth could also stress the county government, which
is holding a bond referendum this year to help services keep pace with
existing growth.
In addition, if the sales tax goes to 8 percent in York County,
people might be more likely to shop in North Carolina or on the
Internet.
• Is something actually going to happen, or is tax reform just
election-year talk?
There seems to be momentum to reduce or eliminate property taxes.
Both House Speaker Bobby Harrell and Senate Pro Tem Glenn McConnell are
from the Charleston area, where property taxes have skyrocketed in
recent years, and both have pledged strong support for reform.
"This is the No. 1 godzilla issue," said Rep. Bill Cotty, R-Columbia,
chairman of a House committee studying the issue. "This will be like a
barreling train."
McConnell put it this way: "We're tired of county councils running
around and telling voters they are stuck with the valuation system as it
is now and blaming the folks in Columbia."
• What are the nuts and bolts of the plans?
The Senate proposal would eliminate property taxes only for school
operations on owner-occupied homes and personal property taxes on cars,
boats, etc. It also would create a refundable tax credit for renters.
The House plan would eliminate all taxes on owner-occupied homes.
The House plan would change the way home values are assessed by
freezing assessments until a house is resold or improvements are made.
The Senate bill would authorize the General Assembly to create a set of
options for counties to value property; if the county didn't choose one,
the default method would be the same version as the House's proposal.
Both bills would impose caps on tax increases without a referendum.
The specifics of the plans will be hammered out in the coming months.
• Would food be taxed?
The Senate plan would eliminate the sales tax on food in two steps,
reducing it to 2 percent the first year and eliminating it the second
year. The House plan would eliminate the sales tax on all unprepared
food.
• Why is this happening now?
Legislators say they've been bombarded with complaints about the
current system of taxation, most from people living in owner-occupied
homes. The goal would be to shift the heftiest tax burdens from property
owners and distribute them more evenly.
Supporters of tax reform say having the state pay for education will
make the funding system more fair statewide.
-- Rebecca Sulock
