"More than a publication"
Home > Opinion > Letter to Editor: McCleod Addresses Misinformation Regarding Lexington Penny

Letter to Editor: McCleod Addresses Misinformation Regarding Lexington Penny

Earl McCleod, Executive Director of Home Builders Association of Greater Columbia, has provided a summary of facts in response to “various allegations” about the Lexington County Penny. They are listed below.

 

– $300 million tax increase

This is a one penny sales tax increase that will expire in 8 years; it is estimated that the penny sales tax will generate $290 million in revenue over 8 years.

– It’s Lexington’s biggest hike – ever!

This is a one penny sales tax increase.  The impact to individuals will be based on how much money they spend in Lexington County on items that are assessed the capital penny sales tax.

– Unnecessary: The Lexington Chronicle reports the county has $127 million in unused cash

Lexington County does NOT have a $127 million cash fund balance to appropriate.  As of July 1, 2014 Lexington County had a cash fund balance available for appropriation as follows:

General Fund:         $18,373,487

Fire Service:           $5,304,458

Law Enforcement:   $6,356,296

***Of note it is important that the County maintains a positive cash fund balance to protect its Aa- Bond Rating.

Also of note is the funding from the State, Local Government Fund (LGF) which is funding designed to pay for State Mandates.  LGF funding has been reduced the past 7 years. While funding has been reduced by the State, the mandates remain & County Council is required to fund the operations.  The total reduction of that funding over the past 7 years to Lexington County is almost $16 million dollars.

 

  – Cost per family of 4: Like an extra car payment per year for the next 8 years

In order for a family of 4 to pay an extra $500/year they would have to spend $50,000 in Lexington County on items that are assessed the Capital Penny Sales Tax.

 

– Actual pavement: Less than 15% of the “high priority” tax money will actually go to paving or resurfacing

  – More than 40% of the tax money is for vanity projects like greenways or bike paths

There are 69 High Priority projects on the Ballot.

  • Transportation Projects total $178,398,631.86 (66.5%)
  • Water/Wastewater Projects total $46,978,818.60  (17.5%)
  • Stormwater/Drainage Improvement Projects total $6,141,464.60  (2%)
  • Pedestrian Sidewalk/Bike Paths/Greenway Projects total $15,576,788.58  (6%)
  • Community Enhancement Projects total $20,960,815.00  (8%)

 

  – Project priority a whim: may be adjusted by the County Council

Only the projects on the ballot can be completed with the Capital Penny and they are prioritized  1 thru 93.

 

  – Includes a hidden “ad valorem” property tax

Bond Language on Ballot—General obligation bonds are subject to whatever bond millage is required in order to service the bonds.

State Law Section 4-10-330 (D) requires the backup source of payment of the bonds if the sale and use tax is inadequate. The backup source of repayment is the General Obligation bond pledge. Unless the sales and use tax revenue projections are completely wrong, there should not be any bond millage tax levied.

The statute requires the bond question to be on the ballot if bonds are to be issued and are to be payable from the sales and use tax.

If the County were to issue bonds without putting the question on the ballot, the amount of the bonds would be limited by the 8% debt limit of the County which would limit the bonds to an amount significantly less than the $150 million. Also, there would be issues as to using the sale and use tax to pay the bonds if that use is not on the ballot.

It simply means that, if approved, the County will have the option to issue bonds not to exceed $150 million that will be repaid with the sales and use tax. The provision is required by the SC Statute and simply means that if the sales tax is insufficient to pay bonds (which is not very likely)  that the county could levy a sufficient amount of tax to pay for the bonds. The reason for the option to issue bonds is to get projects under construction as quickly as possible, take advantage of lower construction costs and complete projects timely.  ***Reminder that the estimate to be generated is $290 million and the bond would not exceed $150 million.

 

  – It won’t come off in eight years

The SC State Law which governs the Capital Penny Sales Tax is very clear that the tax will begin on May 1, 2015 and end on April 13, 2023.

 

 

A list and description of the projects on the referendum can be found at this link  www.pennyforprogresslex-co.org

Registered voters can view their sample ballot and find the location of their poll at this site http://scvotes.org

The Penny for Pavement Facebook page is a good source of information as well https://www.facebook.com/PennyForPavementLex

 

Click for more:

 Vote YES

Scott Adams: Lexington 2 Bond Referendum

Jill Libbey: Lexington 2 Bond Referendum

Tom Ledbetter: Lexington County Penny

Tiffany Heitzman: Lexington County Penny

Vote NO

Curtis Loftis: Lexington County Penny

Carolina Ledger: Lexington County Penny

  Various Viewpoints

Free Times: Lex 2 Bond/ Penny

The State: Lexington County Penny

WLTX: Lexington County Penny

Carolina Ledger: Lexington County Penny

Like What You See?

Comments

comments