Dec
12

A Modest Proposal on Parkside: The Coleman Tax

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As I mentioned earlier this week, the general assembly last year gave counties the option to impose a transfer tax of up to four tenths of a percent on all real estate sales provided voters approve the tax in a referendum.

The idea is that since sales of real estate drive demand for infrastructure, it’s only fair that those involved in those sales should pay a modest amount toward building the things – schools, streets, sewers, etc. – needed to make your average subdivision livable.

So that got me to thinking. Stewart Coleman says that if the county wants to buy him out, they’ll have to pay $4.5 million for the Hayes-Hobson building and the slice of Pack Square immediately adjoining. The commissioners are balking at this for at least two reasons: first, because that’s an astronomical price for what he’s selling, and second, because they’re already looking ahead to tough budgetary times.

So what to do? Ladies and gentlemen, I’d like to introduce the Coleman Tax. Based on my very rough estimate of $1.4 billion in real estate sales in Buncombe this year, we’d only have to impose a transfer tax of 0.1% – and that for only three years – in order to make up for the hole that Stewart Coleman seems intent on creating in our county budget.

And that’s my proposal. Across the state, developers, builders, and realtors have spent millions defeating this tax in county referenda. So far, 20 counties have tried to pass it, and industry groups have managed to defeat it every time. But if the commissioners were to go to the people of Buncombe and say, “hey, this is the lowest we could charge, we’re only going to do it for three years, and we’re only doing it because developer, builder, and realtor Stewart Coleman refuses to come to his senses” – well, how could it fail?

After all, it’s hard to come up with a clearer example of the public costs of private enterprise.

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Comments

  1. Doug Gibson says:

    Alternately, they could either invoke eminent domain or file an injunction against the demolition of Hayes-Hobson and the destruction of the magnolia. But they’re going to have to choose one of those options soon.

  2. eemilla says:

    I do not agree with the transfer tax, but I do agree with the eminent domain option. The commissioners made an egregious error, and they deserve to pay for it.

    On the other hand, what if the city (or government body with the power) created a special tax for all private property built on public land with a grandfather clause for existing structures as of December 2008.

  3. Mtn Style says:

    On the other hand, what if the city (or government body with the power) created a special tax for all private property built on public land with a grandfather clause for existing structures as of December 2008.

    This would discourage some development of joint ventures between the city and say…PIP (Public Interest Projects) or MHO (Mountain Housing Opportunities)who are trying to do good for the area and are having enough of a hard time getting funding both privately and from banks. The city also will need more joint ventures to help with their plans.

    I would hope eminent domain would be used only as a last resort for anyone, even if it is Coleman.

    I can’t believe the Historical Society can not step in or something. What would an injunction do in the long term and how would that proccess need to get started?

  4. Doug Gibson says:

    There are problems with the transfer tax, but in this case, whether sellers eat it the additional charge or tack it on to the sale price, it won’t be too much of burden on buyers ($200 for a $200,000 house).

    But the beauty of the transfer tax – for me, anyway – is that because the seller pays it, developers will be writing most of the checks. And in this case, they will essentially be writing those checks to Stewart Coleman. (Also, since the transfer tax is already approved, there wouldn’t have to be any lobbying of our state legislators.)

    But my proposal is at least half in jest. I think eminent domain is the best option. But whatever happens, one of the two governments involved is going to have to take action, and soon.