The JIPSD Commissioners voted for a budget that is based upon a shift to one day a week garbage pick up starting in January.
A short power point is on the JIPSD website. You can see it here.
In my opinion, the key information is the estimated $423,000 in cost savings each year.
According to the JIPSD staff budget proposal for 2015, solid waste collection costs
$ 1,847,095 per year.
So, shifting to one day a week garbage pick-up would result in a 22% cost saving each year for solid waste collection.
For the entire JIPSD general fund budget of $ 6,605,855 that is a 6% annual cost saving.
If the JIPSD were to pass this cost saving on to the taxpayers, that would be a 3 mill decrease.
However, annual JIPSD revenues are currently less than expenditures. According to their budget document, the deficit for 2014-15 will be about $382,000.
Unlike the Federal government, where a budget deficit means additional borrowing, the JIPSD is spending some of its net fund balances. The JIPSD is spending some of the money that it has saved up in the past on current operating expenditures. They have been operating with a relatively large net funds balance. After looking at the practice of other government entities, they are gradually reducing it to what they consider a more appropriate level.
(The Town is doing the same thing, using the net funds balance we built up over the first three years to pave roads and build sidewalks. The long lead time before starting construction of this projects is why we didn't spend the money already. Our target for net fund balance is 15% of operating revenue. The JIPSD appears to be aiming at 25%.)
Eventually, the JIPSD must balance its operating expenditures and revenues. Because the JIPSD operating budget is almost entirely funded by property tax, that means increasing its millage. The JIPSD staff proposed a 25% increase in millage over the next 5 years, from 51.1 to 64.1. (64.1-51.1)/51.1 is approximately 25%. In 2020, the operating revenues and expenditures would balance and the net funds balance would have gone from about $3 million down to about $2 million, which is about 25% of the $7.5 million operating budget they plan in 2020.
The point of all of this is to emphasize that rather than passing on the savings and provide a 6% tax cut, the shift from two day a week to one day a week garbage service is aimed at making the tax increases smaller.
The JIPSD Ways and Means Committee voted for a draft budget that shifts from two day a week to one day a week garbage service. Rather increasing taxes by 25% between now and 2020, this budget only increase taxes about 8%. The first tax hike would be next year--2 mills and the second would be in 2020, another 2 mills.
Now, I don't think that going to one day a week will turn a 25% tax increase into an 8% increase. It seems to me that 25% minus 6% is 19% not 8%.
Part of the difference is due to other changes the Commissioners made in the budget. The original proposal was for a 2% cost of living increase, an average 2.5% merit increase, and $300,000 to increase salaries in the fire department so that they would become closer to the average in other area fire departments. This has changed to a 5% across the board raise plus a 2.5% average merit increase. (The Town is also increasing salaries next year, but by a more modest 2% cost of living increase.) The total cost of the new plan to the general fund budget should be less.
I also believe that the shift from two day to one day allows future tax increases to be pushed beyond the JIPSD's five year planning horizon.
In my view, if the alternative is even more massive and rapid property tax increases, then cost savings are essential. One day a week is the way to go.
Further I have proposed that the JIPSD transfer the service rights to solid waste collection to the Town and reduce JIPSD taxes in the Town's tax district to 35.4 mills. This is 2/3 of the 53.1 mills the JIPSD is proposing for next year. The Town would introduce a 17.7 mill property tax. That is 1/3 of what the JIPSD is proposing for next year. I have told them that I would be willing to agree to modest increases in the amount we pay over the next 5 to 7 years.
This plan is based upon the assumption that the JIPSD will go to one day a week solid waste collection. It is based upon the JIPSD getting enough money from the Town to pay for one day a week garbage service in the Town. If the JIPSD Commissioners agree, then the people in the Town would be getting less service, but they would be paying much less tax.
However, there is certainly nothing that would prevent the Town from seeking to negotiate a contract with the JIPSD that would instead have them continue to provide 2 day a week garbage pick-up in the Town. And while the exact charge would depend on negotiation, it would be more than 17.7 mills, probably more like 22 mills and perhaps as much as 25 mills.
That would mean that rather than the total millage staying the same in the Town and unincorporated area, with the Town and JIPSD millage in the Town adding up to the JIPSD millage in the unincorporated area, the total millage in the Town would be higher. The 35.4 mills of the JIPSD plus 22 mills for the Town would add up to 57.4 mills.
Of course, the Town would be required to provide a LOST tax credit, which would greatly reduce the taxes paid to the Town. Further, I would propose that we zero out the Town tax credit for the next few years. Eventually, however, Town would have to collect money from the taxpayer. These are rough estimates, but for a $200,000 house, we might need to collect $30 per year starting in 2020 if we keep up two day a week service. (If the Town is reunited, it might be sooner, though the amount would stay about the same.)
Of course, we could negotiate one day a week with the JIPSD at some time in the future, and then would be able to continue to zero out the Town taxes.
This is all conditional on the JIPSD Commissioners agreeing to transfer service rights to the Town so that they can lower their taxes in the Town's tax district. And then agreeing to provide solid waste collection to the Town on a two day a week basis at a reasonable charge.
If you would like to have the Town continue 2 day a week garbage service, please let me know. And contact members of Town Council too. And, most importantly, contact the JIPSD Commissioners--ask them to work with the Town.
Sunday, May 31, 2015
Saturday, May 23, 2015
Rep. McCoy Files Annexation Legislation
Representative Peter McCoy filed new annexation legislation
last week in Columbia. The bill modifies legal contiguity in a way that will allow people who were left
out of the Town in 2012 to be included.
House Bill 4203 applies when a municipality is entirely located within a
special purpose district that has an elected governing body. If the bill passes, then any property that
would be contiguous to the municipality but for a break in the contiguity of
the special purpose district would be legally contiguous with the
municipality.
The Town is entirely included in the JIPSD and the JIPSD is governed by elected Commissioners. The breaks in contiguity of the JIPSD are areas annexed by the City of Charleston and the City of Folly Beach. After the bill is signed into law, parcels within the JIPSD and just beyond the areas annexed by the City of Charleston and the City of Folly Beach would be legally contiguous to the Town.
Existing annexation law
could then be applied. This would include adding individual parcels at the request of the property owner or else a petition and annexation election similar to what we did last year for Quail Run and east Lighthouse Point.
If you see Peter McCoy thank for him for his work on this issue. Town Councilman Josh Stokes also deserves credit for his input on the bill.
Once this bill is signed into law, we can
start putting together a petition drive. It requires signatures of 25% of the registered voters in any area to be annexed. And then we would hold an annexation election. If the majority of the voters say yes, the area is back in the Town.
Earlier this year, Peter introduced me to Jay Lucas, the Speaker of the House. The Speaker told me that he was willing to help give the residents of the Town an opportunity to be reunited. Peter thinks we have a good chance for the legislation to pass the House this year. It will then go to the Senate early next year. After it passes the Senate, it goes to the Governor's desk. Hopefully, we can get to work next Summer finally reuniting the Town.
Friday, May 22, 2015
Town Council Report--Majority of Council Backs Tax Relief Plan
James Island Town Council met on Thursday, May 21.
Council approved the purchase of two cameras that will identify license plates. These will be located on Folly Road. The information will be used to catch criminals. The technology cannot be used to control speeding.
Council approved a Municipal-County agreement for paving Jeffry and Lemontree Roads.
Council approved requesting CTC funds to construct Phase II of the Camp Road sidewalk project.
Council held a public hearing on the budget.
Two representatives of the Harbor Creek asked for money to help purchase land for a park near their neighborhood.
JIPSD Chairman Donald Hollingsworth spoke in opposition to the Town introducing a property tax. He said that the JIPSD would not lower its property taxes so that any Town property tax would be in addition to the JIPSD taxes. He said that would be double taxation. He said that the Town would not be able to take over the JIPSD's garbage and trash trucks and would have to buy its own. He said that since the JIPSD wrote a letter saying that it would provide solid waste and fire services within the Town and that was included in the Town's feasibility study, it would be unfair to the JIPSD for the Town to provide solid waste services. There would be no Town without the JIPSD. He said that the JIPSD was raising taxes by 2 percent and wouldn't raise them again before 2020.
He suggested that the Town send some members of Council and the JIPSD send some Commissioners to discuss these issues. (I support that.)
Trent Kernodle spoke as private citizen in opposition to the Town providing solid waste services. He said that because the feasibility study for the Town included a letter from the JIPSD that it would provide solid waste collection and fire services to the Town and collected taxes within the Town, if the Town were to provide solid waste services in some other way it would be in danger of losing its charter. He said that if the Town wanted to get into the garbage business it would have to buy its own garbage trucks. He said that the portion of state law that speak of the transfer of service rights refers to annexation and not incorporation. He said that the Supreme Court has said that incorporation is not annexation. He said that the contracts the JIPSD has with the City of Charleston and the City of Folly Beach requires those Cities provide their own solid waste services and continue to pay the JIPSD for solid waste services.
He didn't mention that he was suing the Town for millions of dollars.
JIPSD Commissioner June Waring spoke and said JIPSD was financially sound. She said that they were raising their employees salaries because that was necessary. She said that they were increasing taxes by 2%. She said that the JIPSD couldn't provide an agreement with the Town that was different than that provided the other municipalities. She said that some citizen would sue the JIPSD and she didn't want to go to jail. She said that the Commissioners support the Town and would like to help the Town with LOST money, but it had to be legal. She said that she was not a lawyer.
Susan Milliken spoke against the Town introducing a property tax and seeking service rights to solid waste. She said that she first heard about this proposal the previous evening. She didn't think that her Town's budget should depend on what another public body would do. She said that the JIPSD were elected by the citizens and represented them.
Council approved 4-1 an amendment to the draft budget to introduce a 17.7 mill property tax rather than a 35.1 mill property tax, provide a tax credit of $2,948,058 rather than $2 million, and spend $1 million on solid waste collection rather than $2 million on fire services. Councilman Milliken opposed the amendments.
Council then voted 4-1 for the budget on first reading. Councilman Milliken voted in opposition.
Town Council voted in favor of my motion to defer the ordinance governing a property tax until the June meeting.
I plan to write Chairman Hollingsworth and ask him to place on the JIPSD's agenda a request by the Town to purchase 2 acres of the JIPSD property for a site of a Town Hall and also the Town's request that the JIPSD transfer service rights to solid waste collection to the Town and that the Town purchase solid waste service from the JIPSD by contract.
I will copy this letter to all of the Commissioners. I hope that the Chairman (or any Commissioner) will ask that these items be placed on the agenda and that a Commissioner will move that each be adopted and another Commissioner will second, so that there will be a vote of the Commissioners and we will see where each JIPSD Commissioner stands. It is important the Commissioners go on record.
I have never proposed that the JIPSD turn over any garbage or trash trucks to the Town. Instead, I have proposed that the JIPSD provide solid waste services to the Town by contract. That means that the JIPSD would continue to own the garbage trucks and trash trucks, hire the employees, pay them, and direct them. The JIPSD Commissioners would determine whether service was one day or two days a week, whether residents provide their own garbage cans or the JIPSD provides them, and so on.
The Town is offering to pay the JIPSD for solid waste collection. We will pay them an amount that is based upon the property tax they would have collected in the Town's tax district. I have suggested 1/3 of 53.1 mills, which is 17.7 mills. This would be approximately $1 million per year. I believe the Town should agree to modest annual increases in payments in the solid waste contract to reflect inflation.
However, the Town is seeking to have the JIPSD stop collecting property tax to fund solid waste collection within the Town's tax district. We are not asking that the JIPSD cease collecting property tax to fund fire service or street signs within the Town's tax district. So we are asking the JIPSD to reduce the millage it collects in the Town so that what remains is that portion that pays for fire service and street sign provision.
If the JIPSD agrees to provide solid waste by contract rather than direct taxation within the Town, the Town will introduce a millage to fund solid waste collection. The Town will be obligated to provide a LOST property tax credit against its own millage. For the foreseeable future, that credit will be greater than the tax owed, so that taxpayers in the Town will pay nothing to the Town. The net result would be a substantial tax cut to all property taxpayers in the Town.
What would happen is that on the tax bill sent by the County Auditor to everyone in the Town, there would continue to be a line for the JIPSD, with a reduced operating millage--initially 35.4 rather than 51.1. There would remain a line for JIPSD bonds which is 3.8 mills. There would be a new line for the Town operating millage, and that would initially be 17.7. The municipal LOST tax credit would appear on the top of the bill. The amount billed from the Town's line would be zero. There would remain other lines for county government operating, county bonds, school board operating, school board bonds and so on. All of the amounts billed are added up to get the total amount that the taxpayer must pay the County Treasurer.
For homeowners in the Town, the bottom line would be a substantial tax cut. The cut is going to be approximately 16% for a homeowner. I can't promise that taxes will be 16% lower than last year, because multiple government bodies collect property taxes in the Town and maybe some of their taxes will increase. But it will be just about 16% lower than what a homeowner would have paid.
South Carolina statutes governing annexation clearly state that special purpose districts can provide services to municipalities by contract. Having a municipality pay for services it doesn't receive may be a contract of sorts, but it isn't a contract for providing and receiving services.
The Town has annexed areas with the JIPSD, though most of the Town was initially incorporated within the JIPSD.
The statute requires that a special purpose district and a municipality negotiate an agreement regarding the transfer of service rights in an annexed that is fair to both the municipality and those remaining in the unincorporated area.
Nothing in the law even hints that when a special purpose district has several municipalities that have annexed territory it must make the same agreement to all of them regardless of differing circumstances. The requirement that an agreement be negotiated and be fair to the municipality and those remaining unincorporated area would make such a rule unreasonable.
Personally, I think a "contract" by which a municipality pays for solid waste services that it does not receive is patently unfair to the residents of the municipality. I grant a municipality could agree to such a contract if it wanted to. However, nothing in the law requires that such an unreasonable and unfair agreement be made.
I am sure that any JIPSD Commissioner who insisted on such an unfair contract, requiring the people of the Town to continue to pay the JIPSD for solid waste collection and find and pay a commercial solid waste company to actually provide solid waste service would find themselves replaced in the next election.
If the JISPD made a fair agreement with the Town, might some citizen in the City of Charleston or the City of Folly Beach complain that the agreement their Cities made with the JIPSD were unfair? Perhaps they would, but their municipal governments made those agreements. It is not up to individual citizens of the municipalities to challenge agreements their elected leaders made.
In my opinion, the reason those municipalities made those agreements is because they didn't want the JIPSD providing services by contract. Since the Town wants to continue receiving solid waste services from the JIPSD by contract, a different agreement is appropriate.
It was obvious that Chairman Hollingsworth and Commissioner Waring were just repeating arguments from their former General Counsel.
Trent Kernodle's arguments run from the implausible to the ridiculous.
Most telling was the truly absurd claim that the Town's "charter" would be in danger if it provided solid waste services some other way than by having the JIPSD collect taxes in the Town and provide the services. The feasibility study submitted to the Secretary of State before the Town's incorporation was nothing more than a study showing that a municipality could operate in some way or other. It is not an agreement with state government binding on the voters and elected officials of the Town for all time.
Of course, what did the Town's feasibility study actually say about solid waste services?
Doesn't look to me that the Town has promised that the JIPSD will continue to collect the taxes. The feasibility study specifically mentioned that the Town might collect the property taxes and pay the JIPSD.
Why would Trent Kernodle say that the Town's charter might be in danger? Why would he make such an absurd claim?
It was an insult the intelligence of Town Council.
But I have seen this pattern before. I saw him tell the JIPSD Commissioners that since the Town agreed that writing tax rebate checks is an administrative nightmare, then having the County Auditor place a tax credit on the JIPSD line on the tax bills would greatly burden all taxpayers of the JIPSD, including those in the unincorporated area who would receive no tax credits. But there would have been no cost to the JIPSD at all! No one was proposing that the JIPSD write and mail rebate checks and so how much that would cost the Town is obviously irrelevant. But that is what Trent Kernodle said to the Commissioners.
That was an insult to the intelligence of the Commissioners.
The JIPSD is proposing to raise property taxes by 3.9% in 2015. The way to calculate the percent change in a millage is as follows: (53.1-51.1)/51.1 = 2/51.1 = .039 = 3.9%. A 2 mill increase from an initial millage of 51.1 mills is a 3.9% increase. It is not a 2% increase.
If the JIPSD will come to an agreement with the Town, they can instead reduce their property tax in the Town from 51.1 to 35.4. The JIPSD could provide a more than 30% tax cut in its taxes compared to what they charged last year..
The Town would then pay for the solid waste collection service by contract, so that there is no decrease in the amount of money the JIPSD receives. In fact, they would get approximately 4% more than they did last year.
As I said before, your taxes can go down rather than go up. All it takes is a majority of Town Council and a majority of JIPSD Commissioners to agree.
The majority of Town Council showed its willingness to move forward. Thank you to all of those members of Council willing to provide tax relief to the people of the Town. Thank you Mayor Pro-tem Leonard Blank, Councilman Josh Stokes, and Councilman Troy Mullinax. I am sad that Councilman Milliken refused to work with me on this.
So all that is necessary now is for a majority of JIPSD Commissioners to move forward.
Of course, Trent Kernodle is suing the Town for millions of dollars. He is seeking lawyer fees from the Town. His self interest is to sabotage this plan. If the Town has its own property tax and provides a LOST credit against it, his suit to force the Town to mail settlement checks will be moot.
I think the JIPSD Commissioners need to get a lawyer who will provide them with honest advice.
Not a lawyer who has a proven record of making patently absurd claims.
And more importantly, not a lawyer who has a clear financial conflict of interest.
Council approved the purchase of two cameras that will identify license plates. These will be located on Folly Road. The information will be used to catch criminals. The technology cannot be used to control speeding.
Council approved a Municipal-County agreement for paving Jeffry and Lemontree Roads.
Council approved requesting CTC funds to construct Phase II of the Camp Road sidewalk project.
Council held a public hearing on the budget.
Two representatives of the Harbor Creek asked for money to help purchase land for a park near their neighborhood.
JIPSD Chairman Donald Hollingsworth spoke in opposition to the Town introducing a property tax. He said that the JIPSD would not lower its property taxes so that any Town property tax would be in addition to the JIPSD taxes. He said that would be double taxation. He said that the Town would not be able to take over the JIPSD's garbage and trash trucks and would have to buy its own. He said that since the JIPSD wrote a letter saying that it would provide solid waste and fire services within the Town and that was included in the Town's feasibility study, it would be unfair to the JIPSD for the Town to provide solid waste services. There would be no Town without the JIPSD. He said that the JIPSD was raising taxes by 2 percent and wouldn't raise them again before 2020.
He suggested that the Town send some members of Council and the JIPSD send some Commissioners to discuss these issues. (I support that.)
Trent Kernodle spoke as private citizen in opposition to the Town providing solid waste services. He said that because the feasibility study for the Town included a letter from the JIPSD that it would provide solid waste collection and fire services to the Town and collected taxes within the Town, if the Town were to provide solid waste services in some other way it would be in danger of losing its charter. He said that if the Town wanted to get into the garbage business it would have to buy its own garbage trucks. He said that the portion of state law that speak of the transfer of service rights refers to annexation and not incorporation. He said that the Supreme Court has said that incorporation is not annexation. He said that the contracts the JIPSD has with the City of Charleston and the City of Folly Beach requires those Cities provide their own solid waste services and continue to pay the JIPSD for solid waste services.
He didn't mention that he was suing the Town for millions of dollars.
JIPSD Commissioner June Waring spoke and said JIPSD was financially sound. She said that they were raising their employees salaries because that was necessary. She said that they were increasing taxes by 2%. She said that the JIPSD couldn't provide an agreement with the Town that was different than that provided the other municipalities. She said that some citizen would sue the JIPSD and she didn't want to go to jail. She said that the Commissioners support the Town and would like to help the Town with LOST money, but it had to be legal. She said that she was not a lawyer.
Susan Milliken spoke against the Town introducing a property tax and seeking service rights to solid waste. She said that she first heard about this proposal the previous evening. She didn't think that her Town's budget should depend on what another public body would do. She said that the JIPSD were elected by the citizens and represented them.
Council approved 4-1 an amendment to the draft budget to introduce a 17.7 mill property tax rather than a 35.1 mill property tax, provide a tax credit of $2,948,058 rather than $2 million, and spend $1 million on solid waste collection rather than $2 million on fire services. Councilman Milliken opposed the amendments.
Council then voted 4-1 for the budget on first reading. Councilman Milliken voted in opposition.
Town Council voted in favor of my motion to defer the ordinance governing a property tax until the June meeting.
I plan to write Chairman Hollingsworth and ask him to place on the JIPSD's agenda a request by the Town to purchase 2 acres of the JIPSD property for a site of a Town Hall and also the Town's request that the JIPSD transfer service rights to solid waste collection to the Town and that the Town purchase solid waste service from the JIPSD by contract.
I will copy this letter to all of the Commissioners. I hope that the Chairman (or any Commissioner) will ask that these items be placed on the agenda and that a Commissioner will move that each be adopted and another Commissioner will second, so that there will be a vote of the Commissioners and we will see where each JIPSD Commissioner stands. It is important the Commissioners go on record.
I have never proposed that the JIPSD turn over any garbage or trash trucks to the Town. Instead, I have proposed that the JIPSD provide solid waste services to the Town by contract. That means that the JIPSD would continue to own the garbage trucks and trash trucks, hire the employees, pay them, and direct them. The JIPSD Commissioners would determine whether service was one day or two days a week, whether residents provide their own garbage cans or the JIPSD provides them, and so on.
The Town is offering to pay the JIPSD for solid waste collection. We will pay them an amount that is based upon the property tax they would have collected in the Town's tax district. I have suggested 1/3 of 53.1 mills, which is 17.7 mills. This would be approximately $1 million per year. I believe the Town should agree to modest annual increases in payments in the solid waste contract to reflect inflation.
However, the Town is seeking to have the JIPSD stop collecting property tax to fund solid waste collection within the Town's tax district. We are not asking that the JIPSD cease collecting property tax to fund fire service or street signs within the Town's tax district. So we are asking the JIPSD to reduce the millage it collects in the Town so that what remains is that portion that pays for fire service and street sign provision.
If the JIPSD agrees to provide solid waste by contract rather than direct taxation within the Town, the Town will introduce a millage to fund solid waste collection. The Town will be obligated to provide a LOST property tax credit against its own millage. For the foreseeable future, that credit will be greater than the tax owed, so that taxpayers in the Town will pay nothing to the Town. The net result would be a substantial tax cut to all property taxpayers in the Town.
What would happen is that on the tax bill sent by the County Auditor to everyone in the Town, there would continue to be a line for the JIPSD, with a reduced operating millage--initially 35.4 rather than 51.1. There would remain a line for JIPSD bonds which is 3.8 mills. There would be a new line for the Town operating millage, and that would initially be 17.7. The municipal LOST tax credit would appear on the top of the bill. The amount billed from the Town's line would be zero. There would remain other lines for county government operating, county bonds, school board operating, school board bonds and so on. All of the amounts billed are added up to get the total amount that the taxpayer must pay the County Treasurer.
For homeowners in the Town, the bottom line would be a substantial tax cut. The cut is going to be approximately 16% for a homeowner. I can't promise that taxes will be 16% lower than last year, because multiple government bodies collect property taxes in the Town and maybe some of their taxes will increase. But it will be just about 16% lower than what a homeowner would have paid.
South Carolina statutes governing annexation clearly state that special purpose districts can provide services to municipalities by contract. Having a municipality pay for services it doesn't receive may be a contract of sorts, but it isn't a contract for providing and receiving services.
The Town has annexed areas with the JIPSD, though most of the Town was initially incorporated within the JIPSD.
The statute requires that a special purpose district and a municipality negotiate an agreement regarding the transfer of service rights in an annexed that is fair to both the municipality and those remaining in the unincorporated area.
Nothing in the law even hints that when a special purpose district has several municipalities that have annexed territory it must make the same agreement to all of them regardless of differing circumstances. The requirement that an agreement be negotiated and be fair to the municipality and those remaining unincorporated area would make such a rule unreasonable.
Personally, I think a "contract" by which a municipality pays for solid waste services that it does not receive is patently unfair to the residents of the municipality. I grant a municipality could agree to such a contract if it wanted to. However, nothing in the law requires that such an unreasonable and unfair agreement be made.
I am sure that any JIPSD Commissioner who insisted on such an unfair contract, requiring the people of the Town to continue to pay the JIPSD for solid waste collection and find and pay a commercial solid waste company to actually provide solid waste service would find themselves replaced in the next election.
If the JISPD made a fair agreement with the Town, might some citizen in the City of Charleston or the City of Folly Beach complain that the agreement their Cities made with the JIPSD were unfair? Perhaps they would, but their municipal governments made those agreements. It is not up to individual citizens of the municipalities to challenge agreements their elected leaders made.
In my opinion, the reason those municipalities made those agreements is because they didn't want the JIPSD providing services by contract. Since the Town wants to continue receiving solid waste services from the JIPSD by contract, a different agreement is appropriate.
It was obvious that Chairman Hollingsworth and Commissioner Waring were just repeating arguments from their former General Counsel.
Trent Kernodle's arguments run from the implausible to the ridiculous.
Most telling was the truly absurd claim that the Town's "charter" would be in danger if it provided solid waste services some other way than by having the JIPSD collect taxes in the Town and provide the services. The feasibility study submitted to the Secretary of State before the Town's incorporation was nothing more than a study showing that a municipality could operate in some way or other. It is not an agreement with state government binding on the voters and elected officials of the Town for all time.
Of course, what did the Town's feasibility study actually say about solid waste services?
The proposed municipality will have the James Island Public Service District continue to provide solid waste pickup. While the municipality could collect property taxes and pay the funds to the James Island Public Service District, the likely approach will be for the James Island P.S.D. to continue to collect the property tax from the Town’s residents, with the Town pursuing an agreement with the District and the Charleston County Auditor to provide for a tax credit against those taxes.
Doesn't look to me that the Town has promised that the JIPSD will continue to collect the taxes. The feasibility study specifically mentioned that the Town might collect the property taxes and pay the JIPSD.
Why would Trent Kernodle say that the Town's charter might be in danger? Why would he make such an absurd claim?
It was an insult the intelligence of Town Council.
But I have seen this pattern before. I saw him tell the JIPSD Commissioners that since the Town agreed that writing tax rebate checks is an administrative nightmare, then having the County Auditor place a tax credit on the JIPSD line on the tax bills would greatly burden all taxpayers of the JIPSD, including those in the unincorporated area who would receive no tax credits. But there would have been no cost to the JIPSD at all! No one was proposing that the JIPSD write and mail rebate checks and so how much that would cost the Town is obviously irrelevant. But that is what Trent Kernodle said to the Commissioners.
That was an insult to the intelligence of the Commissioners.
The JIPSD is proposing to raise property taxes by 3.9% in 2015. The way to calculate the percent change in a millage is as follows: (53.1-51.1)/51.1 = 2/51.1 = .039 = 3.9%. A 2 mill increase from an initial millage of 51.1 mills is a 3.9% increase. It is not a 2% increase.
If the JIPSD will come to an agreement with the Town, they can instead reduce their property tax in the Town from 51.1 to 35.4. The JIPSD could provide a more than 30% tax cut in its taxes compared to what they charged last year..
The Town would then pay for the solid waste collection service by contract, so that there is no decrease in the amount of money the JIPSD receives. In fact, they would get approximately 4% more than they did last year.
As I said before, your taxes can go down rather than go up. All it takes is a majority of Town Council and a majority of JIPSD Commissioners to agree.
The majority of Town Council showed its willingness to move forward. Thank you to all of those members of Council willing to provide tax relief to the people of the Town. Thank you Mayor Pro-tem Leonard Blank, Councilman Josh Stokes, and Councilman Troy Mullinax. I am sad that Councilman Milliken refused to work with me on this.
So all that is necessary now is for a majority of JIPSD Commissioners to move forward.
Of course, Trent Kernodle is suing the Town for millions of dollars. He is seeking lawyer fees from the Town. His self interest is to sabotage this plan. If the Town has its own property tax and provides a LOST credit against it, his suit to force the Town to mail settlement checks will be moot.
I think the JIPSD Commissioners need to get a lawyer who will provide them with honest advice.
Not a lawyer who has a proven record of making patently absurd claims.
And more importantly, not a lawyer who has a clear financial conflict of interest.
Tuesday, May 19, 2015
Proposed Amendment to the Town's Draft Budget
It is time for the Town and JIPSD to come to an agreement to provide tax relief.
I will ask Town Council to amend our draft budget, reducing the proposed millage in the Town budget from 35,1 mills to 17.7 mills and budget $1 million to purchase solid waste collection from the JIPSD by contract.
This will allow the JIPSD to reduce their taxes from 51.1 to 35.4 mills, a 31% tax cut.
Which is better? A 3.9% tax increase in the Town or a 31% tax cut?
The $1 million contract payment from the Town will give the JIPSD the same amount of money that they would have received from the Town's tax district from the higher taxes.
I will ask Town Council to amend our draft budget, reducing the proposed millage in the Town budget from 35,1 mills to 17.7 mills and budget $1 million to purchase solid waste collection from the JIPSD by contract.
This will allow the JIPSD to reduce their taxes from 51.1 to 35.4 mills, a 31% tax cut.
Which is better? A 3.9% tax increase in the Town or a 31% tax cut?
The $1 million contract payment from the Town will give the JIPSD the same amount of money that they would have received from the Town's tax district from the higher taxes.
I will also ask Town Council to approve a nonrefundable LOST property tax credit of $2,948,058, which will zero out the amount of Town's property tax. The Town should get enough LOST funds over the next five years so that no one will pay any tax to the Town.
All that is necessary is a majority of members of Town Council and a majority of JIPSD Commissioners who are willing to work together to cut your taxes.
Report on JIPSD Commission Ways and Means Meeting Monday
The JIPSD Ways and Means Committee met Monday night.
The Commissioners reviewed several budget alternatives. They voted 6-1 for a budget that increases their millage 3.9% from 51.1 mills to 53.1 mills. This budget includes a 7.5% average wage increase and a shift from two day a week to one day a week garbage pickup staring at the first of the year.
The budget also involves another 3.9% millage increase in later years (I am not sure when,), for a total increase of 7.8 percent over the next five years.
The Commissioners reviewed several budget alternatives. They voted 6-1 for a budget that increases their millage 3.9% from 51.1 mills to 53.1 mills. This budget includes a 7.5% average wage increase and a shift from two day a week to one day a week garbage pickup staring at the first of the year.
The budget also involves another 3.9% millage increase in later years (I am not sure when,), for a total increase of 7.8 percent over the next five years.
In terms of taxes, I think this is much better than the other alternatives, three of which involved 25% tax increases over the next five year and one involved 22.9%.
The Commissioners plan to make great efforts to explain why it is necessary to go to one day a week garbage pickup--presumably to avoid the 20% to 25% increase in property taxes over the next five years in the other alternatives.
Saturday, May 16, 2015
Town Budget Hearing Thursday, May 21
The Town of James Island will hold a public hearing on its 2015-16 budget on Thursday, May 21 at 7:00. The first reading on the budget is scheduled for the Thursday meeting.
A copy of the draft budget is here.
There are several important changes in the draft budget from last year. Most important is $2 million in property tax revenue due to the Town introducing a millage of 35.1. The budget includes a $2 million property tax credit, which would zero out the property tax on all taxpayers bills next year.
The proposed budget also includes $2,000,000 in expenditure for a fire services contract with the JIPSD. That payment is conditional on the JIPSD lowering their property tax in the Town by 35.1 mills.
Since the draft budget was prepared, Trent Kernodle has sued the Town seeking to block the Town from providing credits against tax bills and instead forcing it to mail settlement checks. The Town is defending against that suit.
The JIPSD Commission has no clear majority regarding any budget plan, but the initial staff proposal was for a 2 mill tax increase next year. More troubling were additional millage increases adding up to a 25% property tax increase over the next five years.
Further, the JIPSD is considering a shift from two day a week to one day a week garbage service to reduce costs.
I believe that due to the JIPSD Commission's budget problems, the Town should not seek to purchase fire protection from the JIPSD by contract at this time.
However, the proposed tax increases makes tax relief for the people of the Town more important than ever.
I believe that it will be in the best interest of both the Town and the JIPSD for the Town to pursue an agreement to obtain solid waste collection services by contract wit the JIPSD. The annual payment to the JIPSD would be much less, closer to $1 million as would be the necessary Town millage. The LOST property tax credit against the Town millage would reduce the amount taxpayers owe the Town to zero for the next five years.
Any amendment of the draft budget to reflect these changes will require approval by Town Council.
A second major change in the draft budget is to shift $200,000 from the Town's unencumbered fund balance to a Town Hall Building fund. I would like to use some or all of that money to purchase a site for the new Town Hall. I would like to purchase a portion of JIPSD's Dills Bluff property, but if that is not possible, we are looking at other possible locations. Any purchase of property will require approval of Council.
A copy of the draft budget is here.
There are several important changes in the draft budget from last year. Most important is $2 million in property tax revenue due to the Town introducing a millage of 35.1. The budget includes a $2 million property tax credit, which would zero out the property tax on all taxpayers bills next year.
The proposed budget also includes $2,000,000 in expenditure for a fire services contract with the JIPSD. That payment is conditional on the JIPSD lowering their property tax in the Town by 35.1 mills.
Since the draft budget was prepared, Trent Kernodle has sued the Town seeking to block the Town from providing credits against tax bills and instead forcing it to mail settlement checks. The Town is defending against that suit.
The JIPSD Commission has no clear majority regarding any budget plan, but the initial staff proposal was for a 2 mill tax increase next year. More troubling were additional millage increases adding up to a 25% property tax increase over the next five years.
Further, the JIPSD is considering a shift from two day a week to one day a week garbage service to reduce costs.
I believe that due to the JIPSD Commission's budget problems, the Town should not seek to purchase fire protection from the JIPSD by contract at this time.
However, the proposed tax increases makes tax relief for the people of the Town more important than ever.
I believe that it will be in the best interest of both the Town and the JIPSD for the Town to pursue an agreement to obtain solid waste collection services by contract wit the JIPSD. The annual payment to the JIPSD would be much less, closer to $1 million as would be the necessary Town millage. The LOST property tax credit against the Town millage would reduce the amount taxpayers owe the Town to zero for the next five years.
Any amendment of the draft budget to reflect these changes will require approval by Town Council.
A second major change in the draft budget is to shift $200,000 from the Town's unencumbered fund balance to a Town Hall Building fund. I would like to use some or all of that money to purchase a site for the new Town Hall. I would like to purchase a portion of JIPSD's Dills Bluff property, but if that is not possible, we are looking at other possible locations. Any purchase of property will require approval of Council.
Monday, May 11, 2015
JIPSD First Reading on Budget on Tuesday, May 12 at 7:00
The JIPSD Commissioners have held two workshops on the budget.
The 3.9% (2 mills) tax increase for next year is very much on the table.
The budget plans continue to show a 25% tax increase over the next five years--from 51.1 mills to 64.1 mills.
The most recent draft proposes a 5% across the board pay increase for all JIPSD employees, along with an average 2.5% merit increase. So that implies that all JIPSD employees will get at least a 5% pay hike next year, but the average employee will get 7.5%-- some more and others less.
The JIPSD is currently running a $371,000 budget deficit and next year's draft budget proposes a $373,000 budget deficit. The plan is to spend down the funds balance from its current level of $3.3 million, finally bringing revenues and expenditures to rough balance in 2020 with an approximate $2 million funds balance remaining.
The first reading on the budget is scheduled for tomorrow, Tuesday, May 12 at 7:00 PM. The possible sale of the Dills Bluff Property to Charleston County Library and/or the Town is also on the agenda.
The public hearing on the budget is scheduled for Monday, June 8 at 6:30 PM.
The 3.9% (2 mills) tax increase for next year is very much on the table.
The budget plans continue to show a 25% tax increase over the next five years--from 51.1 mills to 64.1 mills.
The most recent draft proposes a 5% across the board pay increase for all JIPSD employees, along with an average 2.5% merit increase. So that implies that all JIPSD employees will get at least a 5% pay hike next year, but the average employee will get 7.5%-- some more and others less.
The JIPSD is currently running a $371,000 budget deficit and next year's draft budget proposes a $373,000 budget deficit. The plan is to spend down the funds balance from its current level of $3.3 million, finally bringing revenues and expenditures to rough balance in 2020 with an approximate $2 million funds balance remaining.
The first reading on the budget is scheduled for tomorrow, Tuesday, May 12 at 7:00 PM. The possible sale of the Dills Bluff Property to Charleston County Library and/or the Town is also on the agenda.
The public hearing on the budget is scheduled for Monday, June 8 at 6:30 PM.
Sunday, May 10, 2015
JIPSD Public Hearing on Budget June 8 at 6:30
The JIPSD public hearing on the budget is scheduled for Monday, June 8 at 6:30 PM.
Thursday, May 7, 2015
Library on Dills Bluff?
At the James Island Intergovernmental Meeting last month, County Councilman Joe Qualey suggested that the new County Library be located on the JIPSD's Dills Bluff Property. JIPSD Commission Chairman Donald Hollingsworth said that the JIPSD was considering a joint facility with the Town on that property. I suggested that having the new library, a Town Hall, and a JIPSD administrative office on the property would be a good idea.
At the JIPSD Ways and Means on May 7, the item was brought up, and a team made up of Deputy County Administrator Walt Smalls, Town Administrator Ashley Kellahan, and District Manager Robert Wise will report back to the JIPSD Commissioners on May 12.
That is the good news.
The bad news is that several Commissioners suggested at the meeting that they opposed the JIPSD selling any property.
I have offered to purchase two acres on the site for a Town Hall, however, I am interested in a joint facility that includes JIPSD administrative offices. There is a majority on Town Council who support the joint facility concept.
There have been some preliminary discussions between the Town Administrator and the JIPSD District Manager, and Ashley Kellahan has made clear our view that the Town must have an ownership interest in any joint facility. We are not interested in leasing office space from the JIPSD for a Town Hall. I do not favor that. There is no majority on Town Council interesting in moving to a new leased facility.
While I am open to a shared building with one wing being Town Hall and another being the JIPSD Administrative Offices, I believe that a better approach would be two separate buildings on the same campus. Adding the new County library as a third building on the same campus would be very beneficial to James Island.
However, I am very much committed to having the Town own its Town Hall. I am open to shared ownership of grounds and parking.
The opportunity to have the new Library on this location is very time sensitive. County Councilman Qualey was only able to get a 30 day delay for the decision on the location of the new Library. County Councilwoman Anna Johnson wants the new Library on the property of Baxter Patrick Middle School, which is off Grimball Road next to James Island Elementary School. Personally, I don't think that is a bad location. However, it is controversial among the residents of the area. And I would prefer a location closer to the center of James Island.
We will see what happens with the meeting between Smalls, Kellahan and Wise, but I believe that to have the Library, Town Hall, and JIPSD Administrative Office on the Dills Bluff property is going to require that the JIPSD agree to sell some of the property to Charleston County for the Library and some to the Town for the Town Hall.
If you think a Library and Town Hall at that location is a good idea, it will be necessary to let the Commissioners know.
http://jipsd.org/commission.html
P.S. The Dills Bluff property was initially purchased by the Town for a Town Hall. When the Town was forced to close in 1997, the JIPSD asked the judge for the property. They received above 5 acres. The Honey Hill Community group also asked for it, and received about one acre. Inez Brown-Couch later gave the portion belonging to the Honey Hill Community to the JIPSD.
At the JIPSD Ways and Means on May 7, the item was brought up, and a team made up of Deputy County Administrator Walt Smalls, Town Administrator Ashley Kellahan, and District Manager Robert Wise will report back to the JIPSD Commissioners on May 12.
That is the good news.
The bad news is that several Commissioners suggested at the meeting that they opposed the JIPSD selling any property.
I have offered to purchase two acres on the site for a Town Hall, however, I am interested in a joint facility that includes JIPSD administrative offices. There is a majority on Town Council who support the joint facility concept.
There have been some preliminary discussions between the Town Administrator and the JIPSD District Manager, and Ashley Kellahan has made clear our view that the Town must have an ownership interest in any joint facility. We are not interested in leasing office space from the JIPSD for a Town Hall. I do not favor that. There is no majority on Town Council interesting in moving to a new leased facility.
While I am open to a shared building with one wing being Town Hall and another being the JIPSD Administrative Offices, I believe that a better approach would be two separate buildings on the same campus. Adding the new County library as a third building on the same campus would be very beneficial to James Island.
However, I am very much committed to having the Town own its Town Hall. I am open to shared ownership of grounds and parking.
The opportunity to have the new Library on this location is very time sensitive. County Councilman Qualey was only able to get a 30 day delay for the decision on the location of the new Library. County Councilwoman Anna Johnson wants the new Library on the property of Baxter Patrick Middle School, which is off Grimball Road next to James Island Elementary School. Personally, I don't think that is a bad location. However, it is controversial among the residents of the area. And I would prefer a location closer to the center of James Island.
We will see what happens with the meeting between Smalls, Kellahan and Wise, but I believe that to have the Library, Town Hall, and JIPSD Administrative Office on the Dills Bluff property is going to require that the JIPSD agree to sell some of the property to Charleston County for the Library and some to the Town for the Town Hall.
If you think a Library and Town Hall at that location is a good idea, it will be necessary to let the Commissioners know.
http://jipsd.org/commission.html
P.S. The Dills Bluff property was initially purchased by the Town for a Town Hall. When the Town was forced to close in 1997, the JIPSD asked the judge for the property. They received above 5 acres. The Honey Hill Community group also asked for it, and received about one acre. Inez Brown-Couch later gave the portion belonging to the Honey Hill Community to the JIPSD.
Tuesday, May 5, 2015
Paving Projects: Ben Road and Jeffrey and Lemontree
The Ben Road paving project is slated to start next week. It should be completed in about six weeks.
The project is being funded 50% using Town funds and 50% with Transportation Sales Tax funds. These monies are from the 1/2 cent sales tax.
Each year, the Town and other municipalities may request local transportation projects be funded from the 1/2 cent sales tax. These projects are rated, and the best are funded. Providing matching funds improves the rating. Charleston County manages the 1/2 sales tax program, and all projects must be approved by County Council.
In 2013, the Town made paving Ben road our first priority and Town Council voted to provide a 50% match of Town funds.
Most of Ben Road had sufficient right-of-way dedicated to the public many years ago. However, the portion past the curve where it connects to Honeyhill Road did not. The first Town accepted Ben Road for public maintenance in the nineties, but after the first Town was closed, Charleston County did not recognize that action. (Perhaps they didn't know.) In 2011, the Town Council voted to accept the straight, constructed portion of Ben Road for public maintenance. When the Town was closed later that year, this was recognized by Charleston County.
The Ben Road project involved obtaining the right of way for the portion of Ben Road past the curve that connects to Honeyhill Road and also constructing the remainder of the road that ends in a cul-de-sac. Charleston County public works obtained the extra right-of-way and completed all the plans. The Town accepted the remainder of Ben Road for public maintenance. The construction contract was approved by County Council.
When the Town approved the Ben Road project, residents from Jeffrey and Lemontree came to Town Hall asking that their road be paved too. I promised that their roads would be next. The problem was that unlike Ben Road, those roads had not been dedicated to the public. The Town asked that Jeffrey and Lemonstree continue to be part of the Charleston County nonstandard road program, which seeks resident approval for continued public maintenance.
Each year municipalities may request funding from CTC. These are state funds distributed by the Charleston County Transportation Committee. The Committee is appointed by the state legislative delegation.
By 2014, the right-of-way on Jeffrey and Lemontree had been obtained. (Thank you Charleston County Public Works!)
The Town made paving Jeffrey and Lemontree Roads our first priority for CTC funds. Town Council approved a 50% match of Town funds for the project.
We found out that the Charleston County Transportation Committee was going to reject our request and instead fund sidewalks on Jerdone and Stiles drive. The Town had requested design work for that sidewalk in 2013, and CTC wanted to fund the construction of the sidewalk. Since the Town was planning to pay for that anyway, that wasn't a problem, but I wanted to get Jeffrey and Lemontree started. I went to the Transportation Committee meeting and offered to provide Town funds for a 50% match of the sidewalk project too. I asked that they approve the Jeffrey and Lemontree project. They did.
The Town accepted Lemontree and Jeffrey Road for public maintenance last fall.
Usually the permitting for these projects takes a long time, but Charleston County Public Works has managed to get it done very fast. They are hoping that the firm doing the construction work on Ben Road will also bid on Lemontree and Jeffrey and do both, one right after the other. Since they will already be there, they are likely to be the lower bidder. Of course, it is by sealed bid, and so some other firm might win the contract.
IF the same firm does both roads, then both projects could be finished by the end of July. Regardless, it is very likely that Jeffrey and Lemontree will be paved by the end of the summer.
Finally!
The project is being funded 50% using Town funds and 50% with Transportation Sales Tax funds. These monies are from the 1/2 cent sales tax.
Each year, the Town and other municipalities may request local transportation projects be funded from the 1/2 cent sales tax. These projects are rated, and the best are funded. Providing matching funds improves the rating. Charleston County manages the 1/2 sales tax program, and all projects must be approved by County Council.
In 2013, the Town made paving Ben road our first priority and Town Council voted to provide a 50% match of Town funds.
Most of Ben Road had sufficient right-of-way dedicated to the public many years ago. However, the portion past the curve where it connects to Honeyhill Road did not. The first Town accepted Ben Road for public maintenance in the nineties, but after the first Town was closed, Charleston County did not recognize that action. (Perhaps they didn't know.) In 2011, the Town Council voted to accept the straight, constructed portion of Ben Road for public maintenance. When the Town was closed later that year, this was recognized by Charleston County.
The Ben Road project involved obtaining the right of way for the portion of Ben Road past the curve that connects to Honeyhill Road and also constructing the remainder of the road that ends in a cul-de-sac. Charleston County public works obtained the extra right-of-way and completed all the plans. The Town accepted the remainder of Ben Road for public maintenance. The construction contract was approved by County Council.
When the Town approved the Ben Road project, residents from Jeffrey and Lemontree came to Town Hall asking that their road be paved too. I promised that their roads would be next. The problem was that unlike Ben Road, those roads had not been dedicated to the public. The Town asked that Jeffrey and Lemonstree continue to be part of the Charleston County nonstandard road program, which seeks resident approval for continued public maintenance.
Each year municipalities may request funding from CTC. These are state funds distributed by the Charleston County Transportation Committee. The Committee is appointed by the state legislative delegation.
By 2014, the right-of-way on Jeffrey and Lemontree had been obtained. (Thank you Charleston County Public Works!)
The Town made paving Jeffrey and Lemontree Roads our first priority for CTC funds. Town Council approved a 50% match of Town funds for the project.
We found out that the Charleston County Transportation Committee was going to reject our request and instead fund sidewalks on Jerdone and Stiles drive. The Town had requested design work for that sidewalk in 2013, and CTC wanted to fund the construction of the sidewalk. Since the Town was planning to pay for that anyway, that wasn't a problem, but I wanted to get Jeffrey and Lemontree started. I went to the Transportation Committee meeting and offered to provide Town funds for a 50% match of the sidewalk project too. I asked that they approve the Jeffrey and Lemontree project. They did.
The Town accepted Lemontree and Jeffrey Road for public maintenance last fall.
Usually the permitting for these projects takes a long time, but Charleston County Public Works has managed to get it done very fast. They are hoping that the firm doing the construction work on Ben Road will also bid on Lemontree and Jeffrey and do both, one right after the other. Since they will already be there, they are likely to be the lower bidder. Of course, it is by sealed bid, and so some other firm might win the contract.
IF the same firm does both roads, then both projects could be finished by the end of July. Regardless, it is very likely that Jeffrey and Lemontree will be paved by the end of the summer.
Finally!
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