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Proponents look
to the future; opponents say it’s unfair
Public Hearing on Conveyance Fee increase…
By Bob Robinson
With homes losing a third of their value today, people selling them
under duress have to bring their checkbooks to the table… it’s not fair
to make them pay in order to benefit the county in general.
Short term, yes. But a better economy puts people to work and property
values go up. Long term, they benefit the most.
Those were the basic pros and cons of the Darke County Commissioners
public hearing Monday over the proposed increase in Conveyance Fees
from $2 to $3 per thousand. About 15 people attended.
Jim Poeppelman, CIC Chairman, Randy Gump, CIC Board Member, Matt Kolb,
CIC Treasurer and Marc Saluk, Darke County Economic Development
Director, presented arguments for the increase. Those speaking in
opposition included realtors Bob Nelson and Ed Huffman and private
citizens Tom Subler, Al Bliss and Bruce Mikesell.
In May the Darke County Community Improvement Corporation (CIC)
requested the county increase its Conveyance Fee, a tax levied on the
sale of real estate. The Commissioners agreed to consider it and
announced two public hearings. The second is scheduled for Monday.
According to Commissioners Mike Stegall and Diane Delaplane, a decision
will not be made at that time but will be announced after all the input
had been weighed.
Proponents told the group of the importance of Economic Development,
and that financial resources for competition with other counties and
the operation of the Economic Development Office were needed. Darke
County, as a CIC partner, had committed to $150,000 a year based upon
its Conveyance Fees. In 2004, the funding was $137,000. This year it is
anticipated to be about $90,000.
Poeppelman told the group that the ED program has been extremely
successful, but the goal has always been to move away from reliance on
state and federal funds, which typically have strings attached and
can’t be depended upon from one year to the next.
“For the first time I’ve seen all our local communities on board,”
Poeppelman said. “It’s been a true county effort. Marc has been doing a
tremendous job.” He noted that a couple of successes would not have
been possible without him.
Saluk said they are in competition with neighboring counties that are
already at the $3, $3.50 even $4 per thousand level.
“They have more carrots to offer than we do.”
Bliss questioned that if $4 was the maximum, $3 was the lower end and
the goal was self-reliance, why hadn’t they decided to go for the full
amount. The response was “political reality.”
Stegall said they were trying to be efficient, keep things simple.
Mikesell and Bliss questioned how the money was being spent, including
salaries. Saluk said he was hired at $55,000 a year with anticipated
increases to $65,000 in two years if he was deemed to be doing a good
job.
“Works out to about 12 cents an hour,” Stegall said.
Other expenses included traveling to seek out businesses looking for
start-up or relocation options, as well as those of any other business:
rent, utilities, payroll and other overhead.
Subler noted that big business plays both ends against the middle when
seeking incentives to locate in an area.
“What I’ve found is that the best economic development incentive is low
taxes and less regulation,” he said, noting that the company his father
founded had created thousands of jobs over the years.
Kolb said there’s a saying, “if you don’t eat your lunch, someone else
will,” referring to the fact that incentives today are a fact of life.
All companies do it and the communities able to offer the best deal
will have the successes.
Subler said the proposed tax is a 50 percent increase.
“If I had gone to one of my customers and said I wanted a 50 percent
increase I’d have been shown the door.”
Those in opposition to the increase said emphatically that they were
not against economic development, but were against the manner in which
the additional funds were being sought.
Nelson said he was against supporting it on the backs of people who
have lost a third of their equity.
“In order to make the sale, they have to bring their checkbooks to the
table,” he said.
Subler noted that out of 1,000 property sales in the county, the mean
average was about $48,000. He added, however, that over 600 of those
sales were less than $100.
“(This tax) takes advantage of young people who are struggling, and
senior citizens who have worked hard all their lives to build equity in
their homes only to have another tax taken for government use.”
Following a question by Stegall, Greenville Mayor Mike Bowers said that
when he was in the title business he never saw a deal “blown” by a
Conveyance Fee. Kolb said the same thing.
“That’s because you aren’t at the negotiating table,” Huffman said. He
also noted that some people have to write a check to close the deal
when they sell.
Subler questioned conflict of interest if a “start-up” in direct
competition with the business of a CIC decision-maker requested a loan.
Saluk said the Darke CIC doesn’t issue loans, rather sets up different
programs available to assist them. Decisions are made by simple
majority on a 5-member board; also if there’s a conflict of interest,
that member would recues himself from the decision.
Mikesell questioned return on taxpayer investment.
“I don’t want to give another tax dollar until I know what it gives
back,” he said.
Saluk said that an investment of $225,000 so far has generated over $14
million in state incentives and saved 250 jobs “that we know of.”
The question was complicated due to the infusion of both private and
public funds, however Kolb did some basic calculations of impact of the
jobs saved on the economy…
“It comes to about 6,222 percent return on investment,” he said.
Gump said the common theme seems to be that everyone supported economic
development… so how do we make it successful?
“We need to be frugal. We need to collaborate. I’ve seen economic
development attempts fail in the past,” he said. “Not on the same page,
not enough resources… it’s about working together as a county.
“We’re not picking on seniors or homeowners. We kicked this around for
years. If we want things to be better, we have to grow the economy,
increase the tax base. That reduces the burden on everybody.
“We believe we’re on the right track,” he said. He added that at one
point ED was 100 percent taxpayer funded. Now with P4P (private funding
through Partners 4 Progress), it’s 50 percent taxpayer funded.
Kolb said that the group “being picked on” will benefit the most as
property values go up.
“It is being born temporarily by home owners. When values go up
homeowners will benefit. We have to start somewhere.”
Several people suggested putting the issue to a public vote. A small
sales tax increase was also suggested, however Delaplane said the sales
tax was at its maximum without putting it to a vote.
The next public hearing is scheduled for Monday. No decision will be
made until a future date.
Official minutes from this and last Monday’s meeting will be posted on
County News Online Monday.
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