Mayor’s bid to delay tax increase is rejected

By on June 16, 2011

Mayor Bob Oakes

Nags Head commissioners approved a $15.7 million operating budget with a property tax increase, but the vote Wednesday was not unanimous.

Mayor Bob Oakes made a last-minute pitch to put off a 2-cent townwide tax hike, saying the Board of Commissioners should instead take $626,000 from its savings account to help pay for beach nourishment.

Oakes, who said eliminating the tax increase would help homeowners in the poor economy, was voted down. Other commissioners questioned why he was proposing the change after numerous work sessions on the budget.

“You do put up a good argument,” Commissioner Anna Sadler said. “It is not a good economic time to raise taxes. But then, in the best of times, we didn’t raise taxes . . . There’s never a good time to raise taxes.”

The budget calls for a tax increase of 2 cents per $100 of value townwide and 16 cents in two oceanfront districts. The money will be used to start paying off a $10 million bond for beach nourishment and build a fund for maintenance.

Oakes said that the 16-cent increase in the special taxing districts would be the equivalent of a 5-cent townwide increase and Nags Head could receive more shared revenue from county sales and occupancy taxes in future years. Those distributions are based on how much a town collects in property taxes.

Savings, or the undesignated fund balance, stand at 71 percent of the annual budget. The state recommends towns keep a minimum of 8 percent.

Wednesday’s vote was 4-1, with Oakes opposing.

The budget increases the overall tax to 17.75 cents. Water rates will go up 5 percent to decrease the amount of money the town needs to take from the water reserve fund. The water budget represents an additional $2.7 million.

Line items include $145,00 to extend the multi-use path to the YMCA. Homeowners along the oceanfront will also be assessed $15.86 per year for trash bins to be rolled back.

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