By Jon Barber
For the Salisbury Post
Recent articles in this newspaper have confirmed that county and state leaders will continue pushing for a local bill that would allow a referendum on reinstating a penny sales tax the legislature allowed to expire on June 30. If approved by Rowan voters, this would generate approximately $8 million which the state had collected to balance its budget since 2001. To sell this, state legislators want to know how local option revenues would be spent. Easily identifiable areas are property tax relief (which would benefit all residential and commercial owners) and education funding. But let’s not stop there.
Rowan already imposes a quarter-cent sales tax resulting from a voter approved referendum in November 2009. These revenues are only to be used to fund our new jail and a mandatory FCC upgrade of our radio telecommunications system. Let’s leave this voter approved quarter-cent sales tax in place. After these projects are paid for, we should honor a resolution a previous board unanimously passed in December 2009 to sunset (eliminate) this tax.
The demographics of Rowan County continue to change. Case in point — our seniors and veterans. Our population of seniors and veterans continues to grow faster than any other group. Seniors and veterans are on fixed incomes. Medical costs continue to escalate. Social Security benefits are a target for reductions. And most do not have their own children in our schools.
To further justify to our state legislators how local option revenues would be spent, we should push for increases in the homestead exemptions for elderly or disabled elderly, and veterans or disabled veterans, so more can qualify and realize increased benefits.
For seniors, the current maximum annual income can be no more than $27,100 to qualify for an exemption on their primary residence. For example, if this annual income was raised to $40,650, more seniors would qualify, resulting in more savings on their property taxes in addition to a general across-the-board cut.
For veterans, there is no annual income tied to this exemption. The exemption amount is $45,000 on their primary residence. For example, if this amount was raised to $67,500, there would be more savings on their property taxes in addition to a general across-the-board cut.
How would we pay for these increased exemptions? Any decrease in property tax revenues would be offset by revenue received from the penny sales tax. Today, there are 2,764 seniors and 187 veterans who are in the current homestead exemption program. The amount of the deferred tax base is $122 million (less than 1 percent of the total tax base), which is a reduction of $757,000 in revenue, equaling $274 per exclusion).
By adding these increased exemptions to a local bill, and asking for it to be uniformly applied across the state, we could make this a reality. Rowan County could set an example for others to follow. But make no mistake. This will require more selling on our legislators’ part and some intestinal fortitude from other state legislators.
Property tax relief — offset by a local-option sales tax — will benefit everyone. Let’s take this opportunity to fight for even more property tax relief for our seniors and veterans through increased homestead exemption allowances. They’ve earned it.
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Jon Barber is a Rowan County commissioner.