Tag: tax increase

Fate of County Council Draws Near with Upcoming Vote on Impact Fees

In two weeks, the 12 members of Horry County Council will go a long way toward deciding their future fates with the voters when third reading of the county impact fee ordinance comes up for a vote.
In 2018, over 70% of voters approved establishing impact fees in the county on an advisory referendum question on the general election ballot.
Those voters have not forgotten their eminently clear message to county council – vote for impact fees.
On the table at third reading of the ordinance is imposition of an impact fee of approximately $6,600 for new single-family homes and varying impact fees for other types of new construction depending on the type.
The need for impact fees to pay for the costs of new development is quite simple. Revenue from those fees can be used to fund new capital projects in a variety of categories including roads, parks and recreation facilities, libraries, fire stations and police stations that will be needed to serve the huge amount of development currently underway in the county.
Using impact fees to pay for such new construction can reduce the pressure on the general fund to pay those costs or the need to impose such things as special projects sales taxes such as the RIDE tax.
To further exacerbate the issue, eight members of county council (Johnny Vaught, Dennis DiSabato, Cam Crawford, Gary Loftus, Bill Howard, Orton Bellamy, Danny Hardee and Mark Causey) provided the votes to pass the largest individual tax increase in Horry County history – 7.5 mils in the unincorporated area plus increases in two additional fees.
As one social media post noted about the tax increase, “Absolutely heinous that the special interests and county council put all this (costs of) new development on the backs of existing taxpayers. Unbelievable! If they had imposed impact fees when the majority of HC residents approved them several years ago, we wouldn’t have to have such huge mil increases. This is literally taxation without representation and it’s theft.”
And another, “The tax and spend so-called Republicans don’t give a flip. They will find any excuse to raise taxes on the hard-working residents of Horry County.”
Three members of county council, Chairman Johnny Gardner, Harold Worley and Al Allen received thanks for voting against the tax increase and “putting the people first.” Council member Tyler Servant was absent for the vote.
The message in those posts is certainly clear, but one wonders whether all council members are hearing that message.

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County Impact Fees Pass Unanimous Second Reading

Horry County Council is one step closer to imposing impact fees on new construction in the unincorporated areas of the county after unanimously passing second reading of an ordinance establishing those fees Tuesday night.
This is at least the fourth time in the past two decades that impact fees have been discussed by council. In the past, the development lobby has been successful in shutting down impact fees discussions before the issue got too far along in the legislative process.
Circumstances are different this time. Construction, especially of single-family homes, is red hot in the county and gives no signs of slowing down in the immediate future. Similar homes in similar type developments that were being advertised at mid-100s to high-100s last year are now being advertised in the mid-200s. That is approximately $250,000 for the average single-family home being constructed presently in a subdivision.
Some of that increase is due to the cost of building materials which have gone up by as much as four times in the case of lumber over the last 12 months. But profits for the developers have also been rising as the demand for new housing in the county continues to outpace the supply.
During past discussions, developers have been successful with the argument that impact fees would significantly increase the cost of a new home, driving down demand thereby causing high unemployment among the construction industry workers.
That argument does not hold water at this time even though it is being tried again and appears to have a sympathetic ear from a few council members.
Council member Dennis DiSabato attempted unsuccessfully to delay second reading of the ordinance by calling for a new committee to study the issue further. Council member Harold Worley, the most vocal supporter of impact fees during the discussion, said a vote to delay was a “kill pill” and the time had come to vote the ordinance up or down.
Council member Cam Crawford was more vocal and animated during the impact fee discussion than he has been in total in all the other council meetings and discussions over his nearly six years on council. Crawford’s voice and facial expressions clearly demonstrated his distaste for impact fees (or at least the distaste of those who have his ear).
In the end, however, neither DiSabato nor Crawford nor any other member of council voted against the ordinance.

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Horry County Impact Fee Discussion Moves Forward

Horry County Council is expected Tuesday night to have second reading on an ordinance establishing impact fees on new construction.
Council held a workshop on impact fees Thursday with a view to having some parameters for what the new fee would cost.
There has been discussion about impact fees in Horry County for most of the last two decades. Two years ago, an advisory referendum showed three out of four voters supported establishment of impact fees on new construction.
Predictably those in the development industry have fought establishment of impact fees. To date, that industry has been successful in holding the fees off.
However, a number of cities and counties in South Carolina have established impact fees in the nearly twenty-year interim they have been under periodic discussion in Horry County.
One engineer predicted a $6,000 impact fee would stop half the business currently with his firm. This, however, seems a ridiculous statement when the cost of lumber has quadrupled in the last 12 months and construction hasn’t slowed at all in Horry County due to the increase in cost.
Long time county residents have been remarking recently that new home prices have reached ridiculous levels in the county. But new homes are still selling at record levels.
Any cost to the developer and builder winds up on the final purchase price of the home. Impact fees can be thought of as a tax that will be paid by purchasers of new homes to help fund the increased level of government goods and services additional homes and their residents require.
The question for council is who should pay for these increased demands on county government and how much should be paid.
Council member Harold Worley said during the Thursday discussion that $4,500 (impact fee) is not going to slow down development one bit. He noted failure to pass an impact fee ordinance could result in a tax increase of 13.2 mils to residents of the unincorporated areas of the county in the future. Council will vote on third reading of a budget ordinance that increases taxes 7.6 mils in the unincorporated areas of the county next year with additional rises in stormwater and solid waste fees.

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County Council Will Ask Voters’ Permission to Raise Taxes

A strong majority of Horry County Council was unwilling Tuesday night to vote for a significant increase in taxes and fees without hearing from county voters.
Council voted to defer second reading of the county’s budget ordinance until June 1. In the interim, county staff will be putting together two ballot questions, one for a countywide 2 mill tax increase and the other for an additional 2.5 mill tax increase and an addition of $45 in stormwater fees for the unincorporated areas of the county.
The questions will be put to voters throughout the county in an advisory referendum special election scheduled for August 17, 2021. Voters in the cities will only be voting on the countywide tax increase while voters in the unincorporated areas of the county will vote on both questions.
The basics of the budget now being held in abeyance calls for a 3 mill tax increase in the unincorporated areas of the county to add revenue for the operation of the county’s solid waste convenience centers.
County staff proposed budget enhancements (additions) Tuesday night that call for a further 2 mill tax increase countywide to pay for police, E911, EMS and court security additions of personnel as well as a pay increase for all county employees. In addition, staff proposed an additional 2.5 mill increase in the unincorporated areas of the county to fund increases in fire services and a doubling of stormwater fees in the unincorporated areas from the current $44.40 per year per household to $89.40 per year per household (a $45 per year increase).
If both questions are approved by voters, taxpayers in the unincorporated areas of the county will see a 7.5 mill tax increase plus a $45 fee increase on their fall tax bills. Taxpayers residing in the cities will see an additional 2 mills of county tax added to their tax bills.
Staff was also directed by council to determine if the increases could be offset somewhat with the hospitality fee money that was freed up with the settlement of the lawsuit with Myrtle Beach (approximately $26 million), with the money coming from the federal government American Rescue Plan (approximately $34 million per year for two years) and from impact fees should the council pass an impact fee ordinance after its scheduled June 10, 2021 workshop on impact fees.
Growth and its impacts on infrastructure and services has caught up with Horry County, some may say surpassed. Numerous studies conducted throughout the United States over the years conclude that a growth rate of over 1.5-2 percent per year cannot be paid for by the new tax revenue generated by that growth. Staff said growth was estimated to be 5 percent this year with an average of 3.25 percent estimated over the next five years.

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Meet Mark Then and Now

The Mark Lazarus Campaign for Chairman of Horry County Council sent its first mailer to voters over the weekend.

I was happy to see a quote from me in a 2013 article in Grand Strand Daily appeared prominently in the mailer. The quote was complimentary of Lazarus’ first months as chairman.

I’m not sure what the reasoning behind using the quote was or who in the campaign made the decision to use it, but if it was his consultants’ idea, he needs to get new ones.

The quote, rather than discrediting what I have written recently about Lazarus, adds credibility to what I have always told politicians – ‘When I think you’re doing a good job, I will be happy to compliment you. When I think you’re doing a bad job, I won’t hesitate to criticize you.’

Over the last three years, I have been highly critical of Lazarus because I believe he has not been doing a good job as chairman.

When running for reelection in 2014, Lazarus told voters he would “oppose new taxes.” Shortly after successfully winning reelection, Lazarus led council into passing the largest single property tax increase in Horry County history. In addition, council increased road maintenance fees by 67%.

More recently, Lazarus led county council into extending the county wide hospitality tax for an indefinite period in the future despite having no specific plans as to what it would be used for.

Why? Because in Lazarus’ words, if it wasn’t extended, it would be lost.

Call me old fashioned, but I believe a politician should honor his campaign promises otherwise how are we to believe anything he says?

Such as – County council had to spend $12 million for 3,729 acres of swamp land off of International Drive because it was a great deal for the county. The purchase was discussed quietly in secret before being quickly voted on by council.

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NMB TDF Vote Today

North Myrtle Beach voters will go to the polls tomorrow to decide whether a Tourism Development Fee will be instituted in the city.

I support the decision of the North Myrtle Beach City Council to allow this decision to be left up to the voters. Additionally, I support statements from council that, if passed, only the minimum TDF revenue required by law would be used for owner-occupied property tax relief with the majority of that revenue used to benefit all the citizens of the city with improved infrastructure.

The TDF was introduced to the state and this area in 2009. Since that time, it has been my opinion the TDF is used in Myrtle Beach to benefit the Myrtle Beach Area Chamber of Commerce, certain large business owners in that city and residents who live in high end homes.

The North Myrtle Beach approach is significantly different. The city is demonstrating it is not Myrtle Beach in the way TDF funds will be used if the referendum passes.

Since the recent North Myrtle Beach city council budget retreat, it appears city residents are in for some type of tax increase. A property tax increase of 2-3 mills was discussed by council at the retreat.

During presentations about the TDF, City Manager Mike Mahaney discussed the need to find a funding source to address parking problems around the city because public safety people are being tied up dealing with parking problems when they could be better utilized performing other duties.

If the TDF passes, city revenue from the fee could be the funding source for addressing parking problems, which would also benefit public safety by freeing personnel for other needs. Revenue for marketing North Myrtle Beach would be used to promote the North Myrtle Beach brand in order to maintain a strong economy in the city.

Mahaney said one mill of property tax brings in revenue of $375,000 to the city. Three mills, therefore, would bring the city an additional $1,125,000 in revenue for parking and other infrastructure.

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Tom Rice and Private Equity Tax Increases

(The following is a op-ed piece sent to Grand Strand Daily. Pictured above is the writer.)

By John Bonsignor

Recently, Rep. Tom Rice caught flack for his support of certain tax increases being discussed in Washington D.C., and rightfully so.

He rebuffed those claims, stating in a McClatchy news article “that his goal was to tackle tax code changes by making the American economy competitive without increasing taxes.”

A specific example of this is his support of increasing taxes on private equity partnerships’ carried interest. Carried interest is currently taxed at a capital gains rate. Rice, along with many Democrats, want to raise it to the level of ordinary income rates. It’s currently (and appropriately) taxed at the capital gains rate due to the long-held nature of the investment and the sweat equity poured into a business, all principles that are the cornerstone of our American economy.

Rice is a real estate investor and tax accountant. While his tax increase wouldn’t impact his investments, it would hurt private equity investors and their ability to reinvest into our economy.

Is Rice looking out for the economy? Or himself?

It appears Rice is in love with tax increases when he should be against them.

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Additional Funding for Coast RTA

The message from last week’s Horry County Transportation Committee meeting was Horry County Council would search for ways to provide additional funding for Coast RTA.

The transportation agency currently receives $1.055 million annually from the county’s general fund budget. According to remarks by council chairman Mark Lazarus, Coast RTA would like that amount to rise to approximately $1.9 million per year.

In addition, Coast RTA wants to spend a total of approximately $16 million on capital improvements for the system over the next several years. It should be noted, all of this money does not have to come from the county or other local government funding sources. The federal government provides 80% funding for capital expenditures with a 20% local match.

Still, $3.33 million must come from some form of local funding for these capital projects to be realized.

“We’ve got to figure out how to fund them,” Lazarus said during the meeting.

Lazarus said Horry County Administrator Chris Eldridge was investigating ways to provide Coast RTA with recurrent funding. Lazarus said a one-cent local option sales tax was one possibility that would be looked at.

During the discussion, Lazarus made one comment I didn’t understand. He said state law prohibits the use of (property tax) millage from being used to fund transportation.

However, property tax millage is exactly what is being used now and has been for years to provide Coast RTA with annual grants from Horry County.

An additional one-cent sales tax is unacceptable, in our opinion. A one-cent tax was just approved by voters for RIDE III last month. If a sales tax is the preferred way to fund Coast RTA, it should have been included in the list of projects for RIDE III, a perfectly acceptable use of RIDE funds if it had been included in the project list.

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NMB Council Blinks on Tourism Tax

The North Myrtle Beach city council decided Friday that the voters would have a say on whether or not a tourism tax to benefit the NMB Chamber of Commerce will be imposed within the city limits.

The decision occurred during a public workshop on whether a local one-cent sales tax should be charged on sales within the city. At least 80% of the proceeds of the tax would go to the NMB Chamber to fund tourism marketing and advertising expenses that should be a responsibility of individual business owners.

The concept of a publicly elected body taxing citizens for the benefit of private businesses is abhorrent in any scenario, but, not allowing the voters a say in the process, as is practiced in Myrtle Beach, borders on dictatorial.

At least for now, the NMB Council nipped in the bud the question of whether to impose the tax by supermajority vote of council members, the way it was made law in Myrtle Beach.

NMB Mayor Marilyn Hatley alluded to a January or February 2017 time frame for a special election referendum question on whether to impose the tourism tax, but council would have to pass an ordinance on the tax before the referendum question.

The dynamics of a special election, with its traditional minimalist draw of voters, still allows the Chamber a better than average chance of winning the tax vote if a referendum is held.

But, it is better than in Myrtle Beach where the voters have no say at all.

The North Myrtle Beach Chamber of Commerce was established nearly 20 years ago with the specific goal of drawing additional tourists during the spring and fall shoulder seasons.

Funding for the NMB Chamber came from membership fees and the 30% of accommodations tax revenues collected in the city.

According to sources familiar with the Chamber, in recent years it has added employees and expenses, thereby eating up its funding.

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Greed is Good Fever Strikes North Myrtle Beach

It appears ‘greed is good’ fever has struck in North Myrtle Beach as the city considers implementing a one-cent tourism development fee (tax) to follow in the footsteps of Myrtle Beach.

If there is one governmental entity I wouldn’t think other governmental entities would want to copy, it is Myrtle Beach City Council. But, never mind.

The North Myrtle Beach Chamber of Commerce wants North Myrtle Beach city council to copy Myrtle Beach city council in implementing a tax on private citizens to pay for business marketing.

The Chamber evidently believes the money belongs to it rather than to the citizens. Consider the following quote by former Chamber board chairman Bill Griste in a letter to North Myrtle Beach City Council.

“We feel that leaving this significant and large amount of marketing revenue unused would not be a wise move for the City of North Myrtle Beach, nor would be good stewards of this resource.” Bill Griste

Think about that quote for a minute. The resource Griste is talking about is money in the pockets of citizens – A “significant and large amount,” according to him.

Being good stewards apparently means taxing the citizens to pay for the marketing costs of private business. In other words, the Chamber advocates corporate welfare as good stewardship of private dollars – A very interesting concept in a supposedly conservative area.

By that logic, allowing citizens to keep any of their hard earned money, instead of taking it all in taxes, means the government is not being good stewards of the resource (private dollars).

Sorry, I forgot, these aren’t “taxes” they are “fees”. It’s irrelevant that they are charged on the purchase price of items at the checkout counter.

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