First public hearing on proposed property tax sees massive turnout

Aug. 14—THOMASVILLE- The Thomasville City Council held their first public hearing for the proposed property tax increase on Wednesday night, where they were met with strong opposition.

Boasting a packed house and a full overflow room, many residents attended the meeting in hopes of understanding why a property tax was necessary, since the City has relied on the Utilities Fund to support the General Fund over the past 10 years.

Chief Financial Officer Ashley Cason presented the crowd with a series of financial updates, explaining the City of Thomasville has been hard at work on a long-term financial planning goal. Part of the goal is to establish a General Fund Reserve of 25% of revenue. While the goal is in progress, it is currently unattainable due to the fact the City is relying on the Utilities Fund solely.

In a follow up with Cason, she explained that reserve funds are important to help the City prepare for the unexpected and unbudgeted. "Think of reserves as a savings account," Cason explained. "If we have a catastrophic event such as a hurricane or tornado, we could suffer significant damage that would require us to act immediately to ensure the safety and stability of our community."

The General Fund is responsible for the cost of all administration, public safety, highways and streets, housing and economic development.

As of 2022, the General Fund had a total revenue of $24,487,954 million. Over half of the revenue comes from transfers of the Utilities Fund, which totals to $15,581,394. General revenues, including sales taxes account for $2,160,926 of the total, while business taxes account for $2,630,369 of the total. The remainder of the General Fund revenue comes from general taxes, charges for services, fines and forfeitures, licenses and permits and investment earnings.

While it may seem like a large fund, roughly $21 million of the fund was spent in 2022, with public safety expending $13,859,237. Highways and streets account for the second largest expenditure, expending $3,108,0532 this past year, while $2,193,287 was spent on housing and economic development in 2022. Administration and debt service rounded out the expenditures for the year.

The lack of a dedicated funding source to retain employees with a competitive salary and implement long term capital improvements has landed Thomasville an S&P Credit Rating of A.

Cason explained that this designation means Thomasville is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than those rated higher.

When Cason began working in Thomasville in 2017, the city already had an "A" rating. She heard feedback that the city had a weak economy, adequate management, very weak budgetary performance and very weak budgetary flexibility. Since the initial rating, S&P Credit Rating has reviewed Thomasville once again. The city has maintained its "A" rating, but heard a much different feedback, consisting of a strong local economy, strong management, strong budgetary performance and strong budgetary flexibility.

"The reason the 2022 review earned higher marks is because S&P recognized the sound financial planning that was taking place by City leadership with Council support," stated Cason. "They also made it very clear that without having a dedicated funding source to our General Fund such as a property tax, we could expect a less favorable designation at our follow up review."

This credit rating is extremely important to the City because of the City's need to possibly borrow money in the future to complete projects and infrastructure upgrades. "We have always paid for projects as we went without borrowing the money," said Cason. "While this eliminates debt, it impacts the ability to build a reserve balance."

But, it's not enough.

Cason showed the crowd a data chart of how reliant the city has become on the transfer of electric funds, with 2022 surpassing any year prior. Unlike the transfers though, electric sales are not going up. According to Assistant City Manager Chris White, the city experienced a half a million dollar loss in the electric fund for 2022 and is budgeted to experience a $2.8 million loss in 2023.

This loss has shown the importance of a dedicated funding source, such as a property tax. The city concluded their presentation by stating, without a dedicated funding source it limits their ability to provide park maintenance, street paving, recreation and economic development.

The city then offered anyone interested the opportunity to speak.

David Price took to the podium first, explaining he does not reside in Thomasville, but manages 30 properties in the city.

"Clearly if the rates go up, I'm going to have to pass that on to the tenant," Price explained. "That's not really what I want right now, because there's a lot of change going on in this world. A lot of prices are going up and I don't want to pass that on to the tenant. I wish you could hear what is going on in their lives, but I can't afford to pay extra either."

Price was not alone is his concern of the timing of the tax, especially in the midst of an uncertain economy.

Eddie Waldrep, a local business owner agreed.

"We are coming out of a real hard time," he said. "I'm a paramedic on the weekend, and I've been to some of the poorest homes in this city and they are hurting. Their utilities have gone up, their groceries have gone up, their insurance has gone up- everything has gone up and they can't take it one more time."

Waldrep said he, along with many other residents are tightening their belt and looking for ways to save, and he questioned if the city was doing the same.

In 2020, the City realized the need to propose a property tax but didn't act at that time due to the pandemic. "There really never is a good time to do something like this but the alternative will be raising all utility rates across the board," noted White.

Others in attendance felt the city was not looking for ways to cut down on spending, stating they had lost faith in them.

Royal Baker, who owns 163 properties in Thomasville, echoed previous statements about his concern on raising rent, but also shared sentiments that money was not being spent properly. Baker explained he purchased a 2023 truck for approximately $80,000 and has seen numerous of these trucks with the City of Thomasville logo on them throughout town. Not only was Baker concerned about the price of the vehicles, but the increase in gas usage from the vehicles, which was reportedly up 88 percent, according to the budget. However, White assured this was due to the rising cost per gallon and has scheduled a meeting with the fleet department.

City staff shared that while they understand that citizens are upset, the alternative is raising utility rates. The City has also experienced enormous increases in costs. "Our hope is that while difficult, a modest millage rate will provide us the means to improve our overall financial health and open new avenues to us to complete projects our community would like to see," stated Cason. "We want to provide improved parks, address stormwater concerns and repair aging infrastructure. Financially, it's just extremely difficult to do these things and keep rates down and maintain a 0 mill tax."

The City Council thanked everyone for their time and concerns. While no questions were answered on the night of the public hearing, the City Council plans to answer some of the questions at the second public hearing on August 23 at 6 p.m.