Taxes & Bonds
Durham is in a great position, financially. We have a triple AAA Bond rating, and we have a very bright outlook of future population and economic growth. That sad thing is, we’re not making good enough use of these facts.
What good is a perfect credit score if you never take out a mortgage, or apply for credit? Most cities do not have a AAA credit score, why is that? What’s wrong with Austin or Nashville that they aren’t trying to get a AAA?
Most of the other counties in our country that have a AAA rating also have aging white populations with little poverty and wealthy residents. And that’s great for them. But that’s not Durham. We need to be investing in our future. We’re safe.
In business terms, it makes sense. The return on investment from providing better education to our kids is better than the any interest rate change that could come from a bond rating cut. And, over the medium term, our rating would bounce back as we showed we were dedicated to this new policy path, and pursuing it in a responsible manner.
Interest rates are at all time lows right now. Our county economy needs a boost. Our schools and social services are struggling through federal and state cuts. We have pristine credit. Now isn’t the time to scale back, it’s the time to act!
We can recruit better teachers right now than we’ll be able to in 5 years, because good teachers all around the country are being laid off or are resigning because they have increased workloads but decreased salaries.
We can build new school buildings for cheaper right now than we could in 5 years, because right now constructions workers are desperate for work.
We can attract new and innovative non-profits, musicians, and artists for a fraction of the amount it would have cost in 2007. The not for profit sector has been hit the hardest by the recession as foundations’ stock portfolios lost a third of their value, and then they scaled back their giving.
We have so much to gain, and almost nothing to loose.
Now is the time. We can’t wait.
Collection of the Transit Tax.
We passed a sales tax increase, overwhelmingly, last year, dedicated to building mass transit. Currently, we’re not planning on implementing the tax until Wake and Orange counties pass identical ones. But we could start collecting it now, and start using the money to improve our current dismal infrastructure. We could also save it, so that when Wake and Orange pass their taxes, we already have the funding to make capital improvements, without needing to take out a new bond. The current commissioners are afraid to do it, but the people of Durham want it.
Property Tax Rebates for Fixed Income Households within 50% of the Poverty Line.
If we have to raise taxes to pay for the education budget gap, it is going to hit seniors, the disabled, those on welfare, and students the hardest. They are on fixed income and can’t afford the change. This also happens when a neighborhood improves, or gentrifies. Here’s a common tragedy: An old grandmother lives in a house 40 years trying to improve her neighborhood, it finally improves, her property value goes up, her taxes go up, and she has to move. We can fix that with a simple rebate program. We can’t charge different taxes for different groups (that would be illegal). But we can rebate money to those who need it.