More than 20 years ago some Durham City Council members wanted to follow Raleigh’s lead; almost always a questionable notion. They wanted to dump an expensive garbage fee onto citizens instead of raising less expensive property taxes.
In 1993 I campaigned against that regressive garbage fee because it favored the wealthy and profitable corporations over the poor and middle class. With the help of the People’s Alliance and the Durham Committee on the Affairs of Black People we soundly defeated the council incumbent who had led on that issue.
For two decades regressive garbage fees were a settled issue in Durham. But a small garbage fee that needs to be repealed before it can grow larger slipped into the budget last year.
Council members who voted for the fee – Cole-McFadden, Brown, Moffitt and Mayor Bell – just like that council of the early ’90s, mistakenly believed that having a property tax rate higher then Raleigh’s would starve Durham of growth. That’s a screamingly funny notion given the eruption of new buildings and renovation of old ones going on all over town. Did the new people and businesses over the last 20 years not get the memo that property taxes are cheaper in Raleigh?
Never miss a local story.
The facts didn’t support that silly belief then and they don’t support it now. The Bull City has thrived, despite having a higher property tax rate. Perhaps it’s because newcomers have figured out that other cities’ property tax rates are akin to airline ticket prices; you think you’re paying a certain price, but then you’re slapped with fees for baggage, food, knee-room, wi-fi and more. It’s just a bait-and-switch.
In order to get an apples-to-apples comparison, the council of the mid-’90s instructed the budget staff to add up local cities’ total cost to citizens.
They found that despite the other cities’ “airline ticket pricing” strategy of hiding costs in regressive fees, Durham was hardly a more expensive place to live. Too bad Durham staffers don’t do that sort of reality-based analysis anymore.
But wait. Raleigh’s staff does provide that apples-to-apples comparison. Raleigh's property tax rate is 31 percent lower than Durham's. But their analysis shows that a family living in a house valued at almost $190,000 pays just 7 percent less ($122) in Raleigh than the $1,776 they’d pay in Durham. Given the difference in quality of life – and the fact that your money buys more house in Durham – I’d gladly pay an extra $10 a month for what I get in Durham compared to living in Raleigh. Perhaps our county commissioners could put this reality-based data on our tax bills every year, so no one is ever fooled again by Raleigh’s airline ticket pricing strategy.
What’s more, our tax rate didn’t keep Durham from being listed by Businessweek magazine in 2008 as being one of the 12 best places to ride out a recession. The article mentioned our unemployment rate, but made no mention of our tax rate. ( buswk.co/1rMgxIi)
Given the facts, this notion that our tax rate hurts the Bull City’s growth rate should be labeled with the technical term “B.S.”
Before it grows
But that’s not the only reason the council should repeal this ugly fee. Given Mayor Bell’s commitment to reducing poverty in census tract 10.01 in East Durham, he should lead the call for repeal.
Council member Schewel has shared an analysis of the pain this fee visits on those 1,300 families. It shows that the fee – which will certainly grow if not repealed – drains about $20,000 this year out of those households with no change in service. Is that anyway to reduce poverty?
But this fee hurts more than the poor. Homeowners and renters in houses worth almost $400,000 pay more with the fee than with a property tax for the same level of service. And just so some real estate agent can fool a newcomer with our airline ticket pricing? No thanks.
Last, there’s been talk about partially repealing the fee this year. But that doesn’t make financial sense. By repealing the entire fee, citizens would have more money with which to pay the increased taxes for cops, firefighters and park maintenance that are already in the budget.
Anyone supporting this expensive fee is hurting the poor and the middle class. But on the other hand, they are qualified to work for the airlines.
Frank Hyman is a business owner and former member of the Durham City Council.