2011-06-24 Cost of Government Draft Report

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Justification: There are widespread abuses to these tax benefits that cost the County significant lost revenues. Inspections of properties claiming agricultural use are not occurring on a regular basis and there is a wide interpretation with regard to what constitutes agricultural activity. In order to qualify for an agricultural use program, property owners should be required to provide financial documentation that at least some portion of their income is derived, or will be derived, from the agricultural production and/or processing activities on that parcel. Granting agricultural tax benefit for casual agricultural activities such as growing a few fruit trees for personal consumption and/or tethering a goat to keep down the grass should not qualify for agricultural tax benefits. This tax benefit should be used to encourage an increase in agricultural production in the County and not be used for undocumented purposes. County property taxes are the largest source of revenue for County government and revenues could increase if abuse of this agricultural use program is ended. Eliminate the Homeowner’s Real Property Tax Exemption for unpermitted 8. dwellings. Justification: Unpermitted living structures are illegal and potentially pose health and safety issues for the County. By providing a Homeowner’s Real Property Tax Exemption for these properties, the County is tacitly supporting the continuation and spread of unpermitted structures. Elimination of this exemption would encourage homeowner’s to bring their living structures up to minimum County Building code standards in a reasonable period of time, and generate additional revenues to help support this effort. If the owner of an unpermitted dwelling receives a homeowner’s exemption, this property is currently placed in the Homeowners Class. The tax rate on the homeowner’s class is 56% - 66% less than properties in other classes. So with the benefit of the homeowner’s exemption(s) and the lower tax rate, the property owner is likely to pay less in property taxes than if no dwelling existed. Both items #7 and #8 in this summary are important actions that the County can take to increase its revenues and should be considered in combination with efforts to ensure that property tax revenues are expended in an equitable fashion. Impose a fee to be included in each parcel’s tax bill to help fund recycling, e- 9. waste disposal, and help offset the cost of solid waste disposal and illegal dumping clean ups. Justification: In most places in the U.S., residential solid waste disposal fees are charged directly to the customer either by private companies that perform the solid waste collections or by the municipality in the case of public sector collection services. Thus, the cost of solid waste disposal is not a burden on the city or county general fund. As disposal fees are charged only at the County’s two landfills and disposal at the island’s transfer stations is free to the public, the County should consider collecting a small fee included on each property’s tax bill in lieu of instituting a pay as you throw system. The COGC felt that instituting a solid waste disposal fee via the property tax bill would be more cost effective than restructuring the County’s waste operations to create a pay as you throw system. The property tax bill fee could be adjusted for TMKs that have multiple structures or are zoned as multiple family dwellings. 4