Rossville's well-off face taxing situation

Rossville's well-off face taxing situation

August 27th, 2012 by Tim Omarzu in Local Regional News

Bill McCurdy goes for a walk Thursday along South Mission Ridge Drive in Rossville. Some local residents aren't thrilled that their property taxes are going up.

Photo by John Rawlston/Times Free Press.

Teddy Harris

Photo by Stump Martin

WHAT'S NEXT

The final two public hearings on Ross-ville's proposed millage increase are sched-uled for Sept. 10.

POLL: Should the wealthy pay more taxes?

Robin Hood was a hero for taking from the rich and giving to the poor.

Rossville Mayor Teddy Harris hasn't gotten quite the same acclaim from all of his neighbors for restructuring city taxes along those lines.

Harris lives in what's regarded as Rossville's nicest neighborhood: South Mission Ridge Drive.

It boasts well-tended homes, large lawns, miles-long views and well-heeled residents - including business owners, professionals and several City Council members.

But there's a price to pay for living atop the ridge: The neighborhood shoulders a big share of Rossville's property tax burden. It's widely asserted - though no one has hard figures to prove it - that the 110 or so homes that line the long ridgetop drive pay 80 percent of the city's taxes.

And now the neighborhood's property taxes appear to be heading even higher.

The Rossville City Council on Aug. 13 voted 3-2 to approve the first reading of a budget that would eliminate a $6.50-per-month administration fee charged to everyone with a water meter and replace the lost revenue by increasing the property tax by 3.655 mills.

That's good news to lower-income Rossville residents living in the valley. Those whose homes are worth less than $53,000 will see their overall tax bite shrink. And renters who pay water bills also will save $78 annually, because the administration fee is disappearing.

Meanwhile, residents with higher value homes on Mission Ridge and elsewhere in Rossville will pay more, overall, to the city. For example, someone who owns a home worth $180,000 will see his or her city taxes increase by $185 annually.

While he spearheaded the move to remake Rossville's tax structure, Harris is ambivalent about raising taxes on himself and his neighbors.

"I'm not happy about it," the mayor said. "I don't want to go up on taxes."

What is fair?

Harris notes that the property tax increase is less regressive than the fee was, because it's more of a burden for a poor person to pay $78 annually than a wealthy person. But his reasons for backing the change were largely practical.

With the city facing a $227,000 annual budget deficit, something had to be done, he said. Harris also wanted to do away with what he calls a "hated" administration fee after hearing many complaints about it while campaigning.

"I'm facing it head-on and taking it by the horns," Harris said, explaining he can't solve the city's budget problems the way he said Congress does.

"They just print more money. I don't have the luxury to do that."

Harris isn't sure one type of taxation is more fair than another.

"What is fair?" he asked. "I'm not going to say that either one of them's fair."

The millage increase is the first since 2000, he said. The only other increase since then was the administration fee, which was approved in 2004.

"I didn't vote for that," Harris said.

Ridge residents opposed

Council members Cindy Bradshaw and Rick Buff - both of whom live on South Mission Ridge Drive - voted against the millage increase.

More than a dozen Mission Ridge residents expressed their displeasure with the tax increase at the Aug. 13 meeting.

John Llewellyn said that South Mission Ridge Drive brought in 80 percent of the city's revenue, yet many of its residents are on fixed incomes.

Bill Woods said that "any idiot" could pass a property tax increase and that the City Council shouldn't increase taxes when, in his opinion, they're already high. Woods said the city had promised the ridge's residents sidewalks and sewer in 1962, and they still are waiting.

He also said the city should look at alternative ways of generating revenue.

Harris supports that. He's hoping for some source of revenue that would allow the city to roll back its millage rate -- such as new development at the old Peerless Woolen Mills site.

For years, the city was supported largely by the mill. In 1978, the city was so flush with money that the City Council made headlines by completely doing away with city property taxes - for a month, when the majority of council members changed their minds and reinstated taxes.

But Peerless' closure turned Rossville into a mill town without a mill. Nowadays, residential property owners have to pick up the slack.

"You see that mill over there?" Harris asked Thursday, pointing toward the picture window in his office, which is dominated by a view of the Peerless mill. "That mill was the economic engine of the city for years. It's gone now. We had all our eggs in one basket."