September Mayoral Debate: Finance and taxes
By Charleston Mercury Staff
In this edition, we we asked candidates for mayor of Charleston to respond in 500 words to the following:
As mayor, what will you do you change or restructure our tax system to maximize benefits for residents and decide which public works and projects are prioritized and funded?We regret that Debra Gammons, Mika Gadsden and Julia Marsh did not respond to our outreach.
I will inherit the budget that is passed this year. Therefore, I will have little room to make allocation changes. Nevertheless, I will call for a financial audit to be completed within 120 days of taking office in order to truly see what funds are coming in, what is going out and to whom our tax dollars are being paid. I will release this information to be shared with city council and the residents of Charleston. Transparency is of paramount importance as we head into the budget process for which I will be responsible.
Without a transparent financial audit and re-evaluation of our priorities and obligations, we cannot work towards turning the core goals of my campaign into reality: To not leave any community, neighborhood or resident in our city behind. This is how you create a city that works for everyone.
Furthermore, an audit will provide clear and timely recommendations that I will share with the public and bring to Council in order to provide a level of transparency we have not seen. Such an analysis will better inform us on how we make decisions, what we are preparing for, and how the city is run.
The current Chief Financial Officer (CFO) of the City of Charleston is a true professional who is technically and tactically proficient and makes sound decisions. Her team is driven, knows their job and provides fact-based recommendations. Like most departments the CFO of the city needs more staff, updated tools and stronger leadership.
As mayor of Charleston, I will ensure that the necessary tax restructuring is equitable and sustainable. I will not jeopardize our credit rating. Above all, I will be a good steward of public dollars and never betray the ust of our citizens.
Throughout my campaign, I have stressed the importance of putting our residents first. It’s a mantra that will guide every decision I make as mayor, including every dollar of taxpayer money spent under my leadership. Budget inefficiencies, expensive studies and outdated systems waste taxpayers’ dollars. And we’ve seen millions of dollars wasted during the last eight years. If elected, I would draw from my 25 years of business experience and conduct rigorous financial analysis to ensure taxpayer dollars are being well spent.
One of the first initiatives I would work on as mayor is a millage cap for long-time owner-occupied residential property. The diversity and stability of long-term residents who help make Charleston so unique are quickly being diluted by rising property taxes. I want to ensure residents can stay in their homes and that the rising tide lifts all boats. We have people in our communities who have poured their hearts and souls into our city, and we should show our appreciation by not allowing them to be forced out due to increasingly high taxes.
Keeping a balanced budget is another way to ensure residents get the most out of their taxpayer dollars. Last year, the budget had to be shored up by funds from the accommodations tax — money that is supposed to be used to alleviate the effects of tourism on our locals. That is not putting residents first. I would put my years of experience in rigorous financial analysis to work, cutting our inefficiencies from the budget and modernizing our dated organizational chart to keep up with the times. Hundreds of thousands of dollars have been spent on studies that are never implemented, and instead, recommendations are put on the shelf.
In prioritizing public works and projects, we must focus on investing in infrastructure that will have the greatest impact on our community and garner the highest return on investment. You’ve probably heard many opinions on the Old Piggy Wiggly site by now, but it is a perfect example of a lack of leadership and not responsibly utilizing the city’s budget. The mayor wants to sink $45 million of taxpayer money into this Sumar St. development which, under current plans, would see little to no return on investment. With creative thinking and proactive leadership, I know Sumar St. can spur economic development up and down the North Bridge Corridor if done correctly. Charleston deserves leadership that will consider the big picture, plan ahead and keep residents’ best interests in mind — not just slapping together plans to make good on political promises.
The mayor is solely responsible for presenting a balanced budget to Charleston City Council. During my first year in office as a member of city council during the current mayor’s first year, I saw that he was incapable of completing this vital task.
As a result, I conceived and spearheaded the effort to form the city’s ad hoc Budget Committee. This committee now oversees the budget process, adding transparency and engaging council members to ensure the mayor presents a balanced budget.
State law restricts the funding sources and expenditures available to city governments, and until the General Assembly broadens those restrictions, Charleston is limited on how it can collect and spend tax money. In addition, every taxpayer’s city tax bill is reduced by applying 100 percent of the municipal sales tax credit (also called the local option sales tax). Since taking office, the mayor has advocated that less than 100 percent of that credit be applied. If successful, this would increase our property tax bills and our millage rate. As mayor, I vow to ensure that 100 percent of that credit is applied to our tax bill to avoid a backdoor tax.
I also created the Stormwater Department, which initiated the $1 million stormwater project fund, setting aside monies to address smaller stormwater and flooding control projects. As mayor, I would propose increasing that funding.
Finally, I will be a much more vigorous advocate of soliciting for additional state and federal government funds for public works projects.
Any time I speak to a neighborhood association or civic group about taxes here in Charleston, I try to make a point of opening the discussion with three surprising facts:
1. Property tax bills on owner-occupied homes are actually lower today in the city of Charleston than they are in the city of North Charleston.
2. 100 percent of our city’s property tax revenues are spent on public safety, meaning our police and fire departments. One. Hundred. Percent.
3. Everything else the city does — from parks, to planning, to sidewalk repair, to the arts and all the rest — is funded through a mix of business license revenues, grants, tourist taxes and fees.
All of which is to say that Charleston has done a better job than most in clearly establishing public safety as our top priority and creating a solid, multi-pronged approach to revenues, rather than falling into the all-too-common trap of relying too heavily on property taxes alone. Thanks to those kinds of responsible budgeting practices, the city has the highest cash reserves in our history and continues to enjoy a triple-A credit rating.
That said, there are still two major impediments to creating the kind of commonsense tax system that I believe we need: first, under state law, the city cannot impose new tourist taxes and fees or increase those that already exist; and second, state law requires us to spend the vast majority of our tourist tax dollars to attract more tourists, rather than to offset the costs of tourism to our residents.
On the tourist revenue side, we have collaborated with City Council to find creative ways around those limitations, such as working to raise parking fees for leased hotel spaces and requiring all new hotels to pay a sizable affordable housing fee. In addition, later this year, I’ll be asking City Council to raise hotels’ annual business license fees in our 2024 budget. Nonetheless, these kinds of indirect workarounds are no substitute for true home rule — and we will continue to press the legislature for more autonomy in this area.
On the other side of the coin — winning the freedom to spend those tourist dollars in ways that directly benefit our residents — I’m pleased to report that we’ve seen slow but meaningful progress in our work with the state legislature. And as a result of those efforts, we now have limited authority to put some of those dollars into two of the city’s critical priorities — flooding and workforce housing.
Regarding our current spending priorities, I think those are clear and appropriate, with the vast majority of our outlays going to police, fire, sanitation and flooding, with parks, recreation programs, workforce housing and other resident quality of life initiatives making up the bulk of the rest. With our recognition as a Bloomberg What Works City earlier this year, we know that we are among the very best in America at using real data to ensure we’re spending those dollars wisely.