In an article last week, Clayton Councilman Michael Grannis suggested it would be OK to raise property taxes this year because the Town Council had cut the tax rate twice in the last decade or so.
After countywide property revaluation in 2004 and 2012, the Town Council did cut the property-tax rate. But as the town’s own numbers show, a cut in the tax rate doesn’t necessarily mean a lower property-tax bill.
In 2004, after Clayton cut its tax rate to 49 cents from 61 cents per $100 valuation, tax receipts actually climbed by $309,287, or 8.36 percent. In 2012, after the tax rate fell from 54 to 52.5 cents, tax receipts grew by $635,985, or 8.89 percent.
In 2012, a revenue-neutral tax rate, or one that produced the same revenue as the year before, would have been 47.6 cents. Following state guidelines, which acknowledge annual growth in the tax because of new homes and business, the 2012 rate would have been 51 cents. Instead, it was 52.5 cents.
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The bottom line? In the two years in which the Town Council cut the property-tax rate, property owners paid more in taxes.
But at least the Town Council didn’t use property revaluation to pad the tax rate and therefore tax receipts, Councilman Grannis said. No, padding the tax rate came in a non-revaluation year, 2008, when the council raised the rate by 10 percent, from 49 to 54 cents. Partly as a result, revenue grew a whopping 38.27 percent in one year – to $7.08 million from $5.1 million, a difference of $1.96 million. At least town hall was able to avoid the recession that cost so many families their jobs and, quickly, their homes.
We don’t write any of this to suggest town leaders cannot reasonably defend a tax increase this year. Perhaps they can. But as the town’s own numbers show, this Town Council is hardly a cutter of Clayton taxes.