Residence D benefit: expanded tax base

summary:

• both the village and school district project increased need for tax revenue


• Mariemont has very limited land opportunity to expand its tax base


• Jordan Park (built with variances under Residence C) yields $191k annually in property tax to the village and schools over and above previous use


• a proposed project on Madisonville Rd. estimated to yield $273k annually above existing use


• net new income, estate, and business taxes project additional revenue


• Residential D can offset your property taxes
  
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  Residence D offers one of the few current opportunities to expand the village tax base and limit residents' property tax liability. Village and school district expenses have increased over recent years and both anticipate budget shortfalls in the near future. As each entity has undertaken reasonable expense reductions, tax levy increases remain the only feasible option to maintain budgets unless services are reduced or eliminated for both residents and students.
  
  levy forecasts:
  The school district is funded by local property values and state subsidy (state is currently funding 26% of local school district budget (approx. $2 million) until 2012, and is further projecting funding only 16% of local budget afterward). At the same time, the state is considering House Bill 1 which proposes to add unfunded school obligations (pre-school and all day kindergarten) while reducing funding. Additionally, the school district is considering a necessary facility plan to consolidate and upgrade schools. Preliminary budgets show costs around $38 million over 15 years, equating to a 6.5 mil levy. At $35 per mil (i.e., per $100,000 house valuation), a homeowner of a $300k valued home would be taxed at an annual rate of $680 for the facility issue alone, not considering any additional levy costs due to reduced funding and added requirements.
  
  While the school district has not determined how it will proceed with any future funding requirements and does not propose a levy this November, the village government will however have a 4.75 mil levy on the ballot to offset a forecasted $.5m deficit on the $3.5m budget. Short of passing a tax levy, the village options would consist of some combination of service and expense reduction (a potential loss of 6-8 employees out of 25 total) and/or increase in the earnings tax rate. Currently, the village General Fund is operating at a loss of $400k/yr, with the fund balance expected to be negative in 2011.
  
  current tax base:
  In the village, tax base expansion opportunities are limited due to the current land use and lack of available property for new taxable development. Industrial land is maximized along Mariemont Ave. in the area historically named Westover (including the Kellogg facility among others), and the new retail development along Red Bank is only partially taxable for the school district (school taxes for the Ford transmission plant land have been historically appropriated for the Cincinnati school district). As the industrial and business district use is currently maximized, the tax base is effectively capped, leaving the majority of the tax burden shouldered by village apartment building owners and homeowners.
  
  Residence D tax base benefits:
  With the passage of Residence D, responsible multi-family construction will be possible in the village. New condo and apartment units could replace aging and financially stressed apartment buildings to the benefit of the tax base, as already proven with the Jordan Park condos on Miami Rd. Even considering their inclusion in the existing Community Reinvestment Area (which allows 15yr 50% tax abatement in the business district and historical area), the condos annually yield $165k to the school district and $26k to the village over and above the previous land use (aged apartments).
  
  New projected development on just 2 blocks along Madisonville Rd. proposes to yield approx. $238k annual net gain to schools and $35k to the village over the current use, assuming village council assumes a tax abatement under the existing CRA. If a tax abatement is not applied (or in 15yrs when a tax abatement expires), the Madisonville Rd. development on its own will deliver over $580k property tax annually to the schools (and $85k to the village) at today's valuation. Note that these revenue figures are property tax only and do not include any added income tax (46% of village revenues) or estate tax associated with the proposed additional new residents, nor any increased business tax revenues from the business district. (All real estate tax computations by HCDC (Hamilton County Development Co.)).
  
  conclusion:
  The village and schools require increased funding. With no other new tax base proposed in the village, Residence D will allow new housing development to replace aging properties and subsequently relieve the tax burden on village residents. Vote YES for Residence D.