Local News

Theater's troubles could mean tax hike

Posted June 3, 2008 2:17 p.m. EDT
Updated June 4, 2008 12:32 a.m. EDT

— The troubled theater project meant to boost the city of Roanoke Rapids' struggling economy could end up costing taxpayers.

Tuesday evening, city leaders considered but didn't reach a decision concerning a 3-cent increase to the property tax rate to help make up for the loss of money from The Roanoke Rapids Theatre.

City Manager Phyllis Lee said since the facility opened, the city has spent about $739,000 more than it has brought in.

The city has already taken measures to help offset the theater's costs, such as putting a hiring freeze on most employment positions and delaying purchases and initiatives, Lee said.

But the city's fund balance is close to dropping below the required state minimum, she said.

"The city's not currently in trouble, but if you don't watch your finances, you could easily get to the point where you have issues," Lee said.

Under the proposed increase, taxes on the average Roanoke Rapids home – which run anywhere from $120,000 to $150,000 – would increase between $36 and $45. The increase would be for one year and would be re-evaluated next year.

"It's disgusting," said Cathy Maurice, who has run a floral shop in the city for more than a decade. "It's so hard for the small business, as it is."

Others say they understand the need for an increase.

"I'm not for taxes being raised," homeowner Andrea Schmaltz. "But we are in support of the theater."

Part of the city's loss comes from a $547,000 buyout of country music entertainer Randy Parton's contract. The theater's former namesake was hired in 2005 to help jump-start the $21.5 million, 1,500-seat entertainment complex along Interstate 95.

Lower-than-projected attendance and revenue, as well as other controversy, ultimately led to the city's ending its relationship with Parton.

The management company brought in after Parton also terminated its contract with the city in February, claiming the city owed the firm more than $100,000.

Last month, city officials announced Gilmore Entertainment of Myrtle Beach, S.C., would run the theater and produce its shows.

The agreement, as stated in a letter of intent, would have the city paying Gilmore $500,000.

Separate from that agreement, the developers of the land in which the theater sits, Carolina Crossroads, have agreed to pay half of that for the first two years.

The city has yet to sign a contract with Gilmore.