To the Editor:
Salado residents should be alarmed by the precipitous increase in property taxes over the past three years.
Specifically, the Village’s tax rate has increased from $0.12 per hundred dollars of valuation in 2013 to $0.54 in 2016 for a 350% increase. The largest part of the increase ($0.34 per hundred of valuation in 2016) is attributable to the passage of the $10,000,000 Waste Water Bond in November 2014 and funded in August 2015. Since there has been no appreciable action (and no actual construction) to date, the taxpayers of Salado are paying $1,500/day in debt service with no related benefit.
The Village Board of Aldermen (BOA) sold the passage of this bond on the basis that increased sales tax revenues would service the debt and not create a tax increase to residential property owners. This obviously has not been the case, and in my opinion will not be the case in the future. In fact, the BOA can triple the property tax rate again to a state law limit of $1.50 per hundred dollars of valuation and reportedly have stated that they will do so if needed.
According to the Tax Appraisal District of Bell County, approximately 21% of the residential homeowners are exempted from increases in property taxes by age or disabilities. So it follows that the remaining 79% of the homeowners must bear 100% of the property tax increases. Property tax exemptions based on age or disability is standard throughout the state so the heavy weighting of taxes on under age 65 homeowners is just a fact of life.
What is not a standard practice is the action by the BOA in 2008 to grant a 20% tax exemption to homestead property owners. This placed an undue property tax burden on commercial and non-homestead property owners. In 2008, the village had a nearly non-existent property tax rate so the 20% exemption really was a mute issue. With the current tax rate, this is no longer a mute issue but one that will be costly in terms of prospective second home and commercial property buyers in the village now and in the future. One of the unique things Salado has to offer is a resort type environment that could be attractive to second home (non-homestead) buyers. This punitive tax on non-homestead property owners will discourage this type owner (many of which are seniors that are on fixed incomes and are tax conscious).
Most cities would love to have the opportunity to attract second home owners for the simple reason that they are typically more financially viable (they spend more money), they buy more expensive homes and they do not have children to educate. It seems incomprehensible that the BOA would want to continue to discourage second home owners and the related economic benefits they bring to the community in terms of property values and retail sales. Temple is the only other municipality in Bell County that has such an exemption. Further, Salado is probably one of the few municipalities in the state with such a tax exemption. The placing of this tax burden on non-homestead property owners may have seemed like a good idea in 2008 when village property taxes were nearly non-existent, but now it is very short-sighted and causes many unintended negative consequences. The BOA should move immediately to eliminate this punitive tax.
The most alarming thing about the tremendous increase in property taxes over the past three years is not where they are, but where they may go over the next three years and beyond. There have been no increases in village services to residential property owners that warrant any increase in property taxes, much less the lofty increases we have actually experienced. In fact, we do not have many of the services that other municipalities have that enjoy the same, or lower, tax rates, i.e. a paid 24-hour fire department, 24-hour police department, residential sewer service, city owned residential water service, code enforcement, parks and recreation, an adequate residential street maintenance program and a first class city administration building.
For many reasons, providing sewer service to commercial/retail property owners is a good thing. However, financing the cost of the sewer services on the backs of residential property owners was not a good thing. Again, the rationale for selling the passage of the bond package to residential homeowners was severely flawed. In my opinion, the prospect of increased sales taxes paying for the sewer system was never realistic and certainly is not now that a significant amount of the bond money has been spent with no construction started. A basic tenet of municipal taxation was violated with the passage of this sewer bond: property owners that are provided a municipal service and benefit from that service financially should be the ones that pay for it. This is the case in just about every municipality in Texas. However, in Salado, the startling fact is that roughly 75% of residential homeowners of the Village of Salado will get to pay for the lion’s share of the sewer system without any material compensating benefits.
Kent L. Bass
To the Editor:
Contrary to some opinions, the disannexation initiative is not about retaliation or retribution. Instead it is intended to inform all citizens of what we consider to be the mismanagement of Village resources as well as personnel management and the ineptitude of the current Board to accomplish anything. It is also an effort to explain where these irresponsible activities are leading our community in terms of future taxes and the pocketbook results for all the taxpayers in our Village. Cogent points are as follows:
• The Village can increase your tax rate from the current .5412 cents per $100 to $1plus. Based on the current debt they will be forced to raise taxes again in the immediate future. After adding all other county taxes you will be paying the same rate as Belton and Temple. Below are noted the services these communities provide that Salado does not.
• Based on the heavy debt that is being created, citizens over 65 will very likely lose the over 65 exemption.
• Since there are several new housing developments coming to Salado, current citizens will likely have to pay the cost to provide them the services they desire. As published in the local newspaper the Salado city council stated that financing the developers would help pay off the bond on the current sewer mess.
• The Village is now paying $45,000 a month because of the massive debt of the current bond. Where is this money coming from? This is a debt that cannot be sustained by our citizens; the current tax base.
• The Village has yet to determine what the cost will be for connection to the downtown system or what the monthly fee will be.
• Where are the funds coming from to pay for our infrastructure needs such as roads and streets and required maintenance? It seems unlikely current taxpayers will ever be supplied with sewer service.
Some other issues that require consideration which point out the minimal loss of services as a result of de-annexation:
• Ambulance service is not provided by the Village; it is entirely an activity of Scott and White. You are paying for this by the fee established by Scott and White.
• The library is not a Village service; it is an independent service financed with State funding.
• The County Sheriff would provide 24 hour police patrol for people outside the boundaries of the Village.
• The fire department is also a separate entity outside the Village and provide the same service.
• Village franchise fees for trash pick-up, phone service cell and land-line would be avoided.
• Water will still be under the jurisdiction of Salado Water Supply Corporation, again free of Village franchise fees.
• Street maintenance would be provided by Bell County as is currently the case on streets such as O.W. Lowery, West Village Road and Hester Way.
We are all aware of the recent personnel issues which led the dismissal of our former City Manager and Chief of Police and his staff. Can anyone deny the need for a change in light of the debt created by these dismissals and the points cited above.