Facts is Facts
By
There’s going to be a lot of talk about the City of Asheville budget over the next several days. Throughout this process I’ve been very impressed with the work of Asheville’s city staff. They have provided Council with contextualized arrays of options. Council members have been advocates for their constituencies and have also been mindful of the reality of our situation.
We started this year’s budget process with a five million dollar budget gap. Council and staff have worked hard to find ways to minimize service cuts without raising property or sales taxes. The proposed budget holds the line on transit services and a few other items, but you’ll find cuts in every city department.
You may have noticed that the Buncombe County budget didn’t introduce any new taxes or cut any services. How did they manage it? The graphs below may help you get an idea of how this works:
This graph lays out the percentage of sales tax revenues generated by Asheville and Buncombe County. You’ll notice that Asheville’s vibrant economy is an incredible economic engine for everyone in Buncombe County. City sales tax dollars go to funding health care, fire departments and other vital services everywhere from Montreat to Candler.
Asheville’s sales tax revenue doesn’t go directly to the city government. That money is channeled through the County. The county has the power to decide how much of that sales tax money is returned to Asheville’s municipal government. The County can return money based on an ad valorem equation or a population equation. Below you can see how Asheville compares to other NC cities in the amount of sales tax returned to them.
If Asheville’s sales tax were redistributed based on population, we’d still be next to last at 32%, but that gap would add millions of dollars to city coffers. Millions of dollars would go a long way towards building sidewalks, maintaining parks, etc.
I’m confident that Buncombe County Commissioners can appreciate the value that Asheville brings to all county residents. Moreover, as we move forward in efforts to better cooperate on some services, I’m confident that we can leave old divides behind and work from a win-win mentality.
8 Comments
May 21st, 2010 at 9:55 am
Gary Jackson said: “You haven’t seen the full impact of the first phase American Reinvestment and Recovery Act yet!”
Go to http://www.AshevilleCivitan.org, click on “link”, to see the video created Tuesday, May 18th.
Mr. Jackson reported to the Asheville Civitan Club regular meeting on the many events that have happened in Asheville in recent weeks and discusses budget priorities and challenges.
John M Reed, President, Asheville Civitan Club
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May 21st, 2010 at 11:22 am
The Buncombe County Budget does include $7 million from county reserve funds, by the way. I’m working on a post to respond to some of the questions raised here, but I do want to ask if maintenance of parks and sidewalks is as critical as fire protection for the service industry employees who provide the services to the tourists who pay the sales taxes in Asheville and Buncombe County? These services workers not being able to afford a residence within the city where they work.
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May 21st, 2010 at 1:13 pm
Sanuk,
I don’t understand the weighted choice you offer, and it looks designed to ‘gotcha’. Health and safety are top priority. It’s important that Asheville and Buncombe County support one another to ensure that the entire community has a level shot at having a great life.
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May 21st, 2010 at 1:14 pm
Keith,
Thanks for linking the video. I watched it last night, and it’s what inspired this post.
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May 21st, 2010 at 2:54 pm
Gordon -
I’m still trying to learn, and my question was perhaps too leading. My point is to ask where the community’s priorities are and how are we going to get there. I’d love to know how the county came to distribute revenue on the ad valorem basis. I’d also be interested to know if other counties use a per capita basis because it translates into a larger share for the county than the ad valorem. (Sorry for the wonk, y’all). In any event, this issue, as with the water issue, strikes me as a situation in which the whole County (and region) add value to the City and the City in turn complains about sharing the benefits of that value with those who have helped built it. In the end, I do agree that we need more collaborative effort between the City and the County. I think an acknowledgement of the positive contributions of the County to the City, and the acknowledgement that we are one community, would significantly further that process.
Thanks, I’ll go back on my meds now.
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May 21st, 2010 at 3:08 pm
Thanks, Sanuk. Different counties do it different ways for different reasons. I wrote this post to point out the stark contrast between what the city generates and what it gets returned to it. The county certainly contributes to the city, though economically it’s the city that generates the lion’s share of the sales tax revenue.
The county and the city will continue to improve relations as we cooperate on various matters. It’s also important that City voters/taxpayers understand that when City Council says, “we can’t afford to build you a sidewalk”, that’s due in part to Asheville being dead last in returned sales tax revenue in the state of North Carolina.
It’s my hope that as the City and County further build cooperative alliances on various issues, we can agree that a healthy Asheville is vital to a healthy Buncombe. In years when Asheville is cutting services and deferring capital needs, a collaborative spirit can help keep all boats afloat.
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May 21st, 2010 at 8:25 pm
Gordon -
Thanks for being a good sport in a conversation with what, for all you know, is a sock puppet. I continue to have questions about some of the various issue you raise and would love to be pointed to a source for some raw data on the subject.
We all are hoping for better economic times, of course, and they will help alleviate some of these tensions. They will also re-invigorate the real long term issue that the city and county must cooperate on: growth and development. Without a set of tools to mitigate growth — which might include leveling the tax burden, a measured approach to extension of water service, etc — the county will grow too rapidly and the city will be surrounded by non-tax paying gated communities.
I don’t think the City has much to gain in bemoaning the Sullivan Acts or the ad valorem distribution since those State laws are unlikely to change. The county sits in a better economic position at the moment in part because of these laws, but it will fall victim of its own intransigence if it does not work with the city to address growth. I’m not sure what solutions they can bring, but I think this is a time for our State Legislative delegation to step up with a set of tools for the County and City to use together. If those tools can also relieve the current City budget woes, so much the better for us all.
Seriously going to get back on those meds and leave you alone now.
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May 22nd, 2010 at 8:09 am
If you were a sock puppet, I’d smell it Sanuk.
The County can choose whether to practice Ad Valorem or Population distribution. When I point this out, it’s not to “bemoan”. It’s to make clear that County officials have a say in how healthy Asheville will be financially. They decided to hold on to the extra millions this year, though my hope is that next year will be different.
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