Wendell News Outlet

Posted: Wednesday, May 21st, 2008 at http://www.ncspin.com/

What do you do when your personal expenses increase significantly faster than your income? You can turn to credit cards to offset the costs but most money managers will tell you the most sensible way is to reduce your expenses.

If that is what you and I should do, why doesn’t this same logic apply to government? Whether you call it a slowdown or a recession the economy is not exactly robust and growing. Unemployment numbers are up, retail sales are lethargic, and real estate is depressed. We are facing the very real prospect of $4 per gallon gas. Summer vacation plans are being scaled back to pay for higher grocery bills. On the other side of the ledger, however, wage increases do not come close to keeping up with escalating costs.

City and county governments, like you and me, feel those same increases. Only they have a magic wand they can wave to balance the ledger. They can raise our taxes. Wake County is talking about a 15 percent increase in property taxes for the year starting July 1. The City of Raleigh is also considering tax increases, as are other local governments across the state.

I can feel their pain but it appears obvious they cannot feel mine. Mecklenburg County Manager Harry Jones may be one notable exception. Despite the pressures on the county’s budget Jones says this is the wrong time to raise taxes. Administrators will have to find solutions through greater efficiencies and spending reductions.

I am not one to oppose any and all tax increases, but this is not the right year for tax increases. Ask Governor Easley. His proposals for increased taxes on cigarettes and beer was declared “dead on arrival” at the legislature.

Property valuations in Wake County have just increased dramatically due to the recent revaluation and residents are expecting that taxes will be adjusted so as to be revenue neutral. Residents will be keeping a close watch on their tax bills this year. They will also be watching who votes for tax increases.

Tom Campbell
http://www.ncspin.com/