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Home My WebLink About1995-01-10 Work Session e e e ""'III MINUTES OF WORK SESSION, JANUARY 10, 1995 PRESENTATION ON ANNEXATION BY THE CITY OF WILMINGTON PAGE 467 ASSEMBLY The New Hanover County Board of'Commissioners were invited to attend a presentation by the city of Wilmington on Tuesday, January 10, 1995, at 12:30 P.M. in the Council Chambers of the city Hall, 102 North Third street, Wilmington, North Carolina. Members present were: Commissioners Sandra Barone; William A. Caster; william E. Sisson, Jr.; Vice-Chairman E. L. Mathews, Jr.; Chairman Robert G. Greer; County Manager, Allen 0' Neal; County Attorney, Wanda M. Copley; and Clerk to the Board, Lucie F. Harrell. City Council Members Tem Katherine B. Moore; Hamilton E. Hicks, Jr. present were: Mayor Don Betz; Mayor Pro J. D. Causey; Michael Youngblood and Mayor Don Betz called the meeting to order and announced that Council Members, Charlie Rivenbark and Laura Padgett, were not able to attend the meeting. He welcomed all elected officials present from the towns of Carolina Beach, Kure Beach, Wrightsville Beach, the New Hanover County Board of Commissioners, and Board of Education Member, Allene C. Keith. Mayor Betz requested the City Manager, Mary Gornto, to begin the presentation. city Manager Gornto commented on the urban growth that has occurred in the County and reported this growth has created a need for the city to initiate an annexation plan to develop a more adequate and equitable city revenue structure. state policy envisioned that urban services must be provided to urbanizing areas adjacent to existing cities through the orderly consolidation of such areas into the existing cities. Such consolidation through annexation fosters city-county taxpayer equity, promotes greater efficiency in the delivery of urban services, and enhances the city revenue structure to finance needed infrastructure improvements. After study and review, the City Council adopted a Resolution of Intent to develop an annexation plan to cover a 27.44 square mile area. She reported in an effort to better inform the elected officials about the plan, members of the City Staff will make presentations on key issues pertaining to the proposed annexation. The following;presentations were made: I. Urban Growth: The Director of Planning, Arcelia Wicker, Jr. presented charts on the urban growth that is continuing in New Hanover County at a record pace. He reported the proposed annexation plan includes 27.44 square miles, 27,273 people, 11,364 housing units and 6,644.1 acres of undeveloped property. Under the proposed plan, the City's population is estimateq to increase by 37,653 people under current zoning standards. II. Infrastructure Investment: The City Engineer, W. Howard Wood, and Director of Administrative Services, Susan G. Dankel reported on the importance of infrastructure investment. Urban growth does produce more jobs, restaurants, shopping, and access to professional services; however, a greater level of investment is required in community infrastructure such as streets, public facilities, and utilities. Financing the necessary additional infrastructure investment for the Wilmington urban area is the responsibility of the city of Wilmington; therefore, the city must have an adequate and fair revenue structure to meet these demands. III. City Revenue 'Structure: Director of Finance, W. Brent McAbee reported on the following revenue structure problems that have prevented the City from undertaking the expanded program of infrastructure investment necessitated by the continuing urban growth ,in New Hanover County, including the area adjacent to the city: ~ / / MINUTES OF WORK SESSION, JANUARY 10, 1995 . PRESENTATION ON ANNEXATION BY THE CITY OF WILMINGTON PAGE 468 1. New Hanover County has selected the ad valorem method of distribution for sales and intangible property taxes among the several units of local government in the County. If the population method had been selected, as done in Wake, Durham, Cumberland, Gaston, Guilford, Pitt, and Onslow counties, annual City revenue would be increased by $2,686,695 for FY 1994-95. 2. The city has a relatively high ratio of population to the tax base, resulting in a per capita tax base that is 13% lower than the average of the thirteen largest cities in the state. If Wilmington had an average tax base, property tax revenues would increase by $1,699,050 per year, an amount equal to almost seven cents on the City's current property tax rate of 58 cents. . 3. There is very little flexibility in the City's budget to permit additional infrastructure funding without an increase in property taxes. city per capita General Fund expenditures of $611 are 11% less than the average of the thirteen largest cities in the state. 4. .~, . The County has in recent years begun providing utility and other urban services to areas beyond the City and Town limits, the cost of which are financed from general County revenues, including property and sales taxes. Assuming the City taxpayers provide 31% of the total County property tax revenue and that the following $9,850,000 list of County services provided exclusively for properties beyond city and Town limits is reasonably accurate, the City taxpayers' share would be $3,053,500, an amount equal to 12 cents on the city's property tax rate. Regardless of what the need for urban services might be in areas beyond corporate and town limits, the use of Countywide revenues to finance them results in "double taxation" for City and Town taxpayers and seriously erodes their ability to finance the urban services and additional infrastructure investment for which they are responsible. Exclusive services not Provided on a countywide Basis County Sewer System Sheriff's Department County Planning County Engineering Administrative and Overhead $4,100,000 4,000,000 526,000 423,000 801. 000 $9.850.000 Total Only City taxpayers pay property taxes to finance urban services and infrastructure investment provided by the city of Wilmington, although many of the services and facilities are enjoyed equally by those residing beyond the city limits who pay no City property taxes. Annual operating costs for programs benefiting the entire urban area total $6,200,000, including downtown safety, urban transit, public recreation, and street lighting. Expenditures for a variety of capital projects that benefit the entire urban area have totalled $40,000,000 during the last ten years. The cumulative effect of these five revenue structure problems must be addressed and mitigated in order to undertake the additional level of infrastructure investment needed to properly serve the wilmington urban area and New Hanover county. IV. Taxpaver Equi tv: Assistant City Manager, William P. Whisnant, reported all taxpayers, City, Town, County, rural and those in the unincorporated urban area should pay their fair share of the cost for providing local governmental services from which they benefit. l 5. o o o e e e -~~"~r'.' ..... . ~~ ~ MINUTES OF WORK SESSION, JANUARY 10, 1995 PRESENTATION ON ANNEXATION BY THE CITY OF WILMINGTON PAGE 469 The current system is not fair for city of Wilmington taxpayers because of the following reasons: (1) they are taxed by the County for services not provided on a County-wide basis; and (2) the City alone pays the cost of all city services and facilities that benefit the entire urban community and county. V. Annexation: City Manager Gornto reported annexation is the principal means provided by the General Assembly for cities and towns to address the problems associated with urban growth, additional infrastructure investment, local governmental revenue structure, and taxpayer equity. There are other ways in which local government can be structured to address these problems, including consolidation and the use of Special Service Districts; however, these alternatives should not be considered if they do not address the taxpayer equity issue. After the presentations, a period of questions and answers followed. The following comments of concern were voiced by Chairman Greer, Vice-Chairman Mathews, and Commissioner Sisson about statements made in the presentations: (1) County residents 'have not called requesting additional services, nor have they ,complained about the current level of services provided by the :County; (2) disagreement with the double taxation issue; and (3) 't~e accuracy of some figures that were presented in the charts and ,~pr~sentations . Chairman Greer informed the City Council that the Board of County Commissioners would be responding to some of the items ,pr~sented. Also, the Commissioners very much desire to work with ,E:th~ City in providing a local government that will be cost- effective and address the 'needs of the people. The Mayor of Carolina Beach, Toni Loreti, expressed concern for the Town of Carolina Beach sustaining a loss in sales tax .revenue if the City proceeds with the proposed annexation. ~ ,~' Mayor Betz encouraged all elected officials to forward comments, and he reported the City will hold numerous public meetings and hearings to receive comments on the proposed annexation plan. ADJOURNMENT -, The meeting was adjourned at 1:40 P.M. Respectfully submitted, ~~ij~ Lucie F. Harrell Clerk to the Board . '- ~ '; ~