Property tax bills for fiscal year 2021-22 started arriving yesterday in Southern Shores mailboxes. The ad valorem taxes levied go into Dare County’s General Fund, the Town of Southern Shores’ General Fund, and the Town’s 2022 beach nourishment (“BN”) project fund.
Considerable public discussion about tax rates for the beach nourishment project was held in the spring by the Town Council and Town Manager Cliff Ogburn. We appreciate, however, that some of you may have missed the public dialogue and the Town Council’s decision-making and explain below what occurred.
But first we note that the General Fund tax rate imposed for FY 2021-22 remains the revenue-neutral rate of 19.58 cents per $100 of property value that was calculated when Dare County reassessed all properties in 2020. You paid 19.58 cents in FY 2020-21, too.
The revenue-neutral rate seeks to achieve the same level of revenue that was raised with the tax rate that was being levied before the reappraisal occurred. In Southern Shores, that rate was 0.2200 or 22.00 cents. In FY 2022-23, you can anticipate an increase in the ad valorem tax rate for the Town’s General Fund to at least that amount. (Note: If two new people are elected to the Town Council in November, this might not be a foregone conclusion.)
On June 1, the Town Council approved the following ad valorem tax rates to fund the beach nourishment project:
- For properties in municipal service district (“MSD”) 1: 7.15 cents per $100 of assessed value
- Properties in MSD 2: 3.0 cents per $100
- Properties town-wide, not in either MSD 1 or 2: 4.0 cents per $100
After holding State-mandated public hearings, the Town Council enacted on July 1 an ordinance creating and establishing the two MSDs, defining them as follows:
- MSD 1: “All properties that abut the ocean beach of the Atlantic Ocean having an eastern boundary greater than or equal to 25 feet, beginning at the southern town limit and extending to the northern town limit.”
- MSD 2:
- “All properties in District 1 and
- “All properties located east of Ocean Blvd./N.C. 12 and Duck Road/N.C. 12 beginning at the southern town limit extending north to the northern town lines; and
- “All properties located west of and abutting Ocean Blvd./N.C. 12 beginning at the southern town line extending north to 137 Ocean Blvd., and abutting Duck Road/N.C. 12 beginning at 139 Duck Road extending north to 149 Duck Road.”
(See ORD-2021-04-01-MSD.pdf (southernshores-nc.gov))
The Town views MSD 1, the oceanfront area, as subsuming both MSD 2 and the town-wide district, and MSD 2 as subsuming the town-wide district. Computed cumulatively, the BN ad valorem tax rates, therefore, total for each district:
- MSD 1: 14.15 cents per $100 of property value (7.15 + 3.0 + 4.0)
- MSD 2: 7.0 cents per $100 (3.0 + 4.0)
- Town-wide district: 4.0 cents
If you add the General Fund tax rate of 19.58 cents per $100 of property value to the BN rates, property owners are paying a combined total ad valorem tax rate, per district, of:
- MSD 1: 33.73 cents (14.15 + 19.58)
- MSD 2: 26.58 cents (7.0 + 19.58)
- Town-wide district: 23.58 cents (4.0 + 19.58)
The BN tax rates are expressed in your tax bill as “SS BN” (town-wide); “SSMD1” (MSD 1); and SSMD2 (MSD 2). These rates are only in effect for the 2021-22 fiscal year and may be changed by the Town Council in subsequent years of the five-year debt cycle for the nourishment project.
According to Mr. Ogburn, the Town’s annual debt for the project will be about $1.4 million, of which the Town will pay $200,000 from its undesignated fund balance.
Of the remaining $1.2 million, he has explained, MSD-1 property owners will pay in this fiscal year 20 percent; MSD-2 owners will pay 17 percent; and the remaining property owners in town will pay 63 percent.
You may access the Town’s FY 2021-22 budget ordinance here: https://www.southernshores-nc.gov/wp-content/uploads/2021/06/ORD-2021-06-01-Budget-Ord.pdf.
An explanation of the tax rate-assessment is given on Page 3 of the ordinance.
Dare County’s FY 2021-22 budget appropriates $177,886,587, of which $112,706,798 is for General Fund expenses. Its property-tax rate has been 0.4005 (40.05 cents per $100 of value) for the past two fiscal years.
You may access Dare County’s FY 2021-22 budget here:
https://www.darenc.com/home/showpublisheddocument/9728/637619387916130000
You may see Dare’s tax rates for the past six fiscal years at https://www.darenc.com/departments/tax-department/tax-rates.
Ann G. Sjoerdsma, 8/22/21
The Southern Shores Beacon 