Those commenting at a public hearing Wednesday on a proposed Upshur County property tax increase of $.035 per $100 valuation were generally in agreement: No new taxes, and “don’t balance the budget on the backs of taxpayers and county employees.”
About 60 attended the hearing at the large courtroom at the county courthouse.
The court had voted 4-1 on Aug. 24 to increase the county ad valorem tax rate from the current $.4701 to $.5122, an increase of 4.21 cents.
Judge Dean Fowler said the increase would apply only to the 2012-2013 fiscal year.
“This is going to balance the budget, and put us on a cash basis,” Fowler said.
He said the increase would pay off a loan that is being used against the county’s Interest and Sinking Fund (I&O) part of the budget.
Fowler said the proposed budget of about $11 million, which is $430,000 below the current 2011-2012 budget, had been “cut to the bone.”
He said that “there are no other cuts we can possibly make.”
Fowler said that $.0335 of the current budget is to pay off a loan for the I&S..
The effective tax rate, which is the rate that would generate the same revenue as the current rate, is $.4701. The effective rate is higher, because property values declined, Fowler said.
If approved, Fowler said, the tax on a $100,000 home would go up about $30, to about $504 a year.
Fowler “promised” that the increase would only be for one year.
Pct. 2 Comm. Cole Hefner, the only commissioner to vote against the proposed $.0335 hike, said he feared it would become permanent, but that the rate instead should drop by that amount next year.
Hefner made a controversial proposal to change the county’s 2-1 match for employee retirement to a 1-1 match, which he said would save $250,000.
Several commented that in private industry, no one receives a 2-1 match for retirement.
“We’re on the road to bankruptcy” for the county, he said.
Fisher, who has four sons attending Texas A&M University, said that he had gotten his own financial house in order, paying off credit cards, etc., to be able to afford college.
He also had taken “a cut in pay” for himself in his own electrical business, cutting the cost of installing home or business generators (he is a Generac dealer), so he could keep paying his crew decent wages.
“It can be done,” he said.
He suggested the county opt out of the current state retirement system, which he said was endangered by possible bankruptcy, and start their own.
Currently, employees can contribute up to 7 percent to their retirement fund, with the county putting in $2 for every $1 the employee puts in.
Fisher suggested lowering the contribution to as low as 4 percent, with a county 1-1 match.
Dan Miles Jr., chairman of the county Democratic Party, told the commissiones that they cut $1 million from last year’s budget, and now “the county is in the same shape.” He said they should find a way without a tax increase to give county employees a 1 to 1.5 percent pay increase.
Sherri Little, a county resident and the Libertarian Party candidate for the State Board of Education, said “no tax is temporary. I’ve not seen one in my 62 years.”
One man who commented several times said that “the driver of debt is payroll.” He urged the court to “pay fair wages,” but do something about the pension fund match, which he said was more than private industry pays in East Texas.
Judge Fowler said that the average income of county employees is “below the median” for Upshur County.
Fisher spoke again, citing the financial success of a church he attends which has a large reserve account, because at the end of a budget year, unused money is turned back in for the new year’s budget.
Fowler commented that the tax increase would not affect county taxes for anyone over 65, because of the homestead exemption and freeze.
He also said that, by far, the largest share of property taxes is collected by schools, not the county or cities, or the Emergency Services District.
Many others spoke, some several times. No one spoke in favor of the tax.
Another public hearing on the tax rate will be at 9 a.m. Thursday, Sept. 14, at the courthouse.
The tax rate and budget are set to be adopted at the regular Commissioners Court meeting on Friday, Sept. 28.