The Delaware County Board of Commissioners voted Monday to enact a 0.5-mill property tax rollback for one year, as well as a measure that will enable the county to use revenues from an already-existing 0.5% sales tax toward any future borrowing for capital projects.
Prior to the votes, which were both unanimous, each measure was given the second of two public hearings that were scheduled by the commissioners during their meeting on July 28.
Under the property tax rollback, the county estimates just under $5 million in tax relief will be provided to both residential and commercial property owners across Delaware County. The reduction, which will decrease the property tax rate to 1.3 mills, will take effect on Jan. 1, 2023, and will be effective for only the 2022 tax year unless extended by the commissioners.
The approved sales tax measure replaces the language from the 1971 sales tax, which was adopted as an emergency measure at the time and did not allow for the revenues to be used towards bonds supported by the sales tax. The sales and use tax rate will remain at 1.25% but will free up the 0.5% to be used by the county for debt financing.
“This does have an impact on our ability to bond, as well as it could potentially affect our bond rating in the future,” County Administrator Tracie Davies stated during Monday’s session. “This resolution would repeal and replace the 1971 sales tax in the same amount of 0.5% without the emergency clause. This change will, again, enable us to pledge our sales tax dollars for bonding purposes.”
Davies again emphasized the resolution will not change the sales tax rate but rather will allow for those same dollars to be used toward any future borrowing necessary for capital projects.
Delaware County Auditor George Kaitsa said of both proposals, “In my opinion, a reduction in the property tax is the best approach for providing tax relief to the homeowners and business owners in Delaware County who own property in the county. By enacting a property tax reduction in conjunction with a resolution to replace the 1971 0.5% sales tax and keeping that sales tax at the existing rate in place, the county will be able to pledge that sales tax for future borrowing and further strengthen the county’s financial position and triple-a grade credit ratings.”
Kaitsa told The Gazette discussions about a property tax rollback have been taking place among the commissioners dating back to last year’s budget discussions and possibly even longer. Commissioner Barb Lewis stated on Monday the commissioners have been concerned “for several months” about the growing impact inflation is having on the country.
“I’ve spoken with our business and community leaders, other officeholders, residential property owners, farmers, fixed-income residents, and retail consumers including many of our least financially-advantaged citizens … With the passage of today’s resolution, we will be providing tax-payer relief in Delaware County,” she said.
Commissioner Gary Merrell called the language change to the sales tax a “slam dunk” and said that after 51 years, “It’s time we clean it up so we’re in a better position going forward.”
Merrell said of the property tax rollback, “This is a tough time for all of us in this county, and the rollback is an opportunity to provide relief across the board for all the property owners. I think that is a win-win for all of us.”
He went on to say the county tax rate of 1.25% should be a source of pride for the county given that the state allows for a rate of 1.5%.
“That shows you how economically viable our county is and how good we are about running this county in a very efficient manner,” he said. “I think we all take great pride in that. There’s no interest on the part of this commissioner to change it from 1.25% and raise it, and, hopefully, there’s nothing down the road that requires that of us.”
