Southampton board proposes 71-cent real estate tax rate

Published 7:52 pm Saturday, June 1, 2024

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The Southampton County Board of Supervisors unanimously agreed on May 21 to propose a real estate tax rate of 71 cents per $100 of assessed value.

The proposal was made possible by the board’s consensus to do the following:

  • decrease local funding to Southampton County Public Schools by an additional $633,000 and
  • increase the personal property tax rate in the general and public service corporations categories to $5 per $100 of assessed value.

The active real estate tax rate is at 89 cents, and the active personal property tax rate in the aforementioned categories is at $4.70.

During the development process of the county’s fiscal year 2024-25 budget, the real estate tax rate has gone from the originally proposed 86 cents to 79 cents then 76 cents and now 71. The personal property tax rate has gone from the originally proposed $5 to $4.75 and now back to $5.

To help achieve the lowered real property tax rate, the Board of Supervisors has made significant cuts to local funding of the schools, but some supervisors have noted that due to increases in state and federal funding, the school division’s total budget of more than $39 million still reflects an increase compared to FY 2023-24.

William Hart Gillette

Northwest District Supervisor and Board Vice Chairman William Hart Gillette opened up the board’s May 21 meeting by sharing a plan to lower the proposed real property tax rate from 76 to 73 cents.

He said the required local minimum funding for the school system, as required by the state, is $8,212,634.

“We’ve been very generous in the past years by being somewhere in the neighborhood of 75% above the minimum required local funding by the state,” he said. “I’ve been on the board four years, this is going on my fifth year. This is by far the most unpredictable year that I’ve seen in a long time. 

“And with that I would recommend removing $633,000,” he said. “That still leaves us over the local minimum for the school system, and that would take the tax rate 3 cents less than we ended the last meeting.”

The purpose of the board’s May 21 meeting was to hold a public hearing on the proposed FY 2025 county budget, and several members of the public spoke.

Robert T. White

Near the end of the meeting, Southeast District Supervisor Robert T. White noted that every penny of the real estate tax rate equals $216,000, and then he referenced a comment made by a member of the public during the hearing.

“I think what David (Edwards) brought up, if we would go back to $5 on the personal property rate, that’d bring in ($510,000),” White said, affirming that the revenue would be equal to about 2 cents on the real estate tax rate. “And then a lot of these farmers like him and everybody who’s got generational farms, I think that would help them if we did that. That way you’re not (pulling) any income from the real estate, you’re going to get it from people making choices on what they buy. You buy a big boat, you’re going to pay taxes. Buy a big motorhome, you’re going to pay taxes. So to me, that would be the answer.”

Central District Supervisor and Board Chairman Dr. Alan W. Edwards, who has been a strong advocate for lowering both the real estate and personal property tax rates, agreed with White.

Alan W. Edwards

“You’re right,” he said. “You know the personal property is a voluntary tax — you either buy a new car or you don’t buy a new car. The land is not voluntary.”

White said, “Seventy-one cents wouldn’t be much more than a 1% increase. I think everybody can live with 71 cents.”

He added, “David had a good idea. That’s why we have these public hearings.”

Speaking to White in reference to his financial figuring, Southampton County Chief Financial Officer Lynette C. Lowe said, “Every 13 cents in personal property equals 1 cent in real estate, so you’re right.”

Referencing the personal property tax rate, White said, “The $5 isn’t going to kill anybody. I know it’s terrible, it’s a high rate, but maybe we can get a big industry in here in the next few years and we can back off on that. That’s what we’re working on. We’re really working on it.”

Moments before the board took a non-binding straw vote that proved to be unanimous, Southampton County Administrator Brian S. Thrower established what board members were voting on.

“So just to clarify so we’re set going forward, if there’s agreement or a straw vote, I think what you said is cut the rate back down to 71 cents, decrease the school funding by $633,000 and increase the personal property rate to $5, basically,” he said.

The proposed FY 2025 county budget will be up for final approval by the board on Tuesday, June 4.