Local News

Tax Hike Not Only Way to Fund More Wake Schools, Group Says

Posted February 19, 2007 8:58 p.m. EST

— Leaders of the local nonpartisan group on Monday pitched an alternative to a property tax increase to help pay for school construction in Wake County.

WakeUp Wake County's proposal calls for impact fees on new construction projects and a 1 percent real-estate transfer tax on all homes on the market.

"Because the school crisis is connected to growth and the population and school body, we've got to connect our funding to that growth as well,” said WakeUp Wake County Chairwoman Karen Rindge.

WakeUp leaders believe another multimillion-dollar school bond is more likely to pass if voters' property taxes do not increase. Under their plan, the two fees would potentially raise nearly $200 million.

Developers, however, say the proposed fees could discourage homebuyers.

“When you add a fee or a tax to new construction, or even existing homes, you are going to take people in our community who won't be able to purchase the American dream,” said Tim Minton, executive director of the Home Builders Association of Raleigh-Wake County.

Both ideas require legislative approval. County commissioners are not considering either one, and the ideas are not on the legislative agenda.

Wake County supports a menu of options for all 100 counties. Those options include impact fees and real-estate transfer taxes. County commissioners, however, believe a better option in Wake, is a 1 cent sales tax to split between schools and transportation.

They believe that tax is spread out more evenly among all citizens, because it does not single out new homeowners or people buying another home in the county.

“If I lived in Wake County since 1978 and raised my children and moved, why would I pay another tax since I've lived here and have been paying taxes all my life?” County Commissioner Joe Bryan said.

WakeUp calls it fair growth funding, but county leaders believe it is unfair.

Late last year, a Blue Ribbon Committee, made up of local business and community leaders, did not support impact fees. The committee did recommend a real estate transfer tax, but the report said members were sharply divided.