Getting your Trinity Audio player ready...

I recently received an email from Loyd Salter concerning my article on revenue neutral. Lloyd is the Tax Assessor for Beaufort County. Lloyd indicated that my interpretation for revenue neutral was incorrect and didn’t include a factor for average growth.

I either never knew it or had forgotten I ever did know it. My memory is terrible and needs to be refreshed every now and then.

Along with his email, Lloyd included a worksheet with examples calculating revenue neutral for a 4-, 6- and 8-year revaluation. What I referred to as revenue neutral was the estimated tax levy for the revenue of the previous year leading up to the revaluation. I didn’t include any factor for growth.

Revenue neutral according to the State of North Carolina is simply the tax rate to produce equivalent equity with the growth factor included to produce the revenue neutral tax rate.

North Carolina General Statute 159-11(e) states the following:

In each year in which a general reappraisal of real property has been conducted, the budget officer shall include in the budget, for comparison purposes, a statement of the revenue-neutral property tax rate for the budget. The revenue-neutral property tax rate is the rate that is estimated to produce revenue for the next fiscal year equal to the revenue that would have been produced for the next fiscal year by the current tax rate if no reappraisal had occurred. To calculate the revenue-neutral tax rate, the budget officer shall first determine a rate that would produce revenues equal to those produced for the current fiscal year and then increase the rate by a growth factor equal to the average annual percentage increase in the tax base due to improvements since the last general reappraisal.

That is the official and legal state definition of revenue neutral. Due to it including growth, it is not revenue neutral from my perspective. I guess calling it the same as last year would be more accurate.

In any year from a budgeting standpoint, the county and finance manager look at the total needs of the county including such items as increases in insurance, salaries, utilities, maintenance and other needs to determine the proposed budget.

It is up to the Board of Commissioners to modify, add or reduce the proposed budget based on the perspective of each member of the board. I always looked at the previous year in the recommended manager’s budget and compared the expenditures to the current budget.

One of the concerns I have is Beaufort County has been losing population over the years but the size of government has grown. Many of the additions such as the SROs and Paramedics were needed. I hope the commissioners look at recurring cost each year and try to reduce it.

I enjoyed meeting with Lloyd. He is a skilled tax assessor with a full beard and a sense of humor. He says he’s not interested in politics but I think he is. Lloyd is a good successor for Bobby Parker and is highly motivated at his job. I think Lloyd will be in Beaufort County for a long time.

Al Klemm is a Washington resident and a former Beaufort County Commissioner.