Tuesday, May 1, 2012

Albany facing spending cuts!

Post by Mike Flynn

From the Herald: Albany facing tax increases and spending cuts!

It looks like City Manager James Taylor gets it, but how will the commission vote when cuts affect their districts?

From the Herald - In what Taylor called a “blinding flash of the obvious,” commissioners could save money by reducing duplications in service that currently exist within the city government.
“It seems unreasonable to me to ask the citizens to pay more when we have likely efficiencies that can or should be made,” Taylor said. “In the military, we’d call that a blinding flash of the obvious.”

I wish the writer had followed up this statement and asked if Taylor was suggesting that city/county consolidation should be reconsidered.
Another huge issue is property valuation. When the county re-valuated the tax digest, the country was in the middle of a false real estate boom driven by manic lending. Now that the bubble has burst, values are returning to normal, which can be as much as 30% below their value carried on the digest.

The writer also suggest that taxes have been cut over the last two years because millage rates have been lowered. That is a semantics issue. The rates may have gone down, but the tax payers were writing bigger checks to the city because the valuations were unreasonably high. The revenue to the city went up drastically after the re-val, but the tide is starting to go out now.

Some properties are trading at 50% discounts off of their last recorded sale. The tax income to the city is going to contract for years to come, so while these cuts are a step in the right direction... you ain't seen nothing yet!

Adding to the problem is the fact that the percentage of stake holders is low. According to the US Census, 48.5% of county residents own their home, while the state average is 67.2 (The national average is around 67% and Lee County is 77%). In short, property owners are out numbered in Dougherty County, so the commission will have to show some courage to stand up to the majority.

Here are a few suggestions:

1 - Take an inventory of city owned property and sell any deemed to be excess.
2 - Lease or sell Chehaw. I know this is a county property, but a private park operator may have more flexibility. Wild Adventures in Valdosta is a good model.
3 - Lease or sell the Civic Center - Cut a deal to a private promoter to take over operations. Even offer favorable financing and exempt it from the tax digest for five years. At the end of that time, tax it at full value. 

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