Tax cuts may not be the answer

Published 12:00 am Sunday, April 25, 2004

Suffolk’s budget was introduced this week amid calls on City Council for reducing the real estate tax rate.

The current rate of $1.08 per $100 of assessed value is the lowest among major Hampton Roads cities.

I’m a homeowner in Suffolk and, just like any other, would prefer to pay less in taxes. While that may be, I’m not certain that’s the best course for our city to take. Suffolk has made tremendous strides over the past several years in education, public safety and quality of life. Neighborhoods and villages are being revitalized. City water and sewer service is being extended to areas that never before had it. Quality employers are investing millions in our community and providing good jobs to our people.

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Virtually all of this progress is being funded by real estate tax collections, and economic development. That development, however, is directly tied to the improvement in the quality of life.

If we quit making progress in the aforementioned areas, we’re likely to see economic development slow. Moreover, interest rates are on the rise, meaning the red hot housing market is likely to begin cooling, which will make property assessments level off.

While the temptation is great in good times to return to the taxpayers more of their money, it’s something that needs to studied.

Council needs to proceed slowly on this matter.

Jim Gilmore, when running for governor, promised to eliminating the car tax, the impact of which was apparently no better thought out than our country’s invasion of Iraq. Gilmore’s move did what it was intended to do – get him elected governor, but the rest of us are still paying the price for it.

Economic policy should not be motivated by politics. It is, of course, on the state and national level because in America today nobody can be elected to anything without vowing to cut taxes and resisting any tax increase under any circumstances.

That leaves local government as the last bastion of reason and fiscal sanity. When local governments begin acting as irresponsibly as their state and federal counterparts, then we’re headed for big trouble.

None of this is to say that Suffolk property owners like you and me are not entitled to a tax reduction. City Council may well be able to do that, and I hope they can.

But any such move should be based on long-term, strategic planning, not political expediency, And I don’t see how Council has time to give the matter the sober consideration it demands prior to the deadline for approving the budget. This is an initiative that should have been started months ago.

By cutting the real estate tax rate, council members need to be prepared to lower their expectations on the quality of education in Suffolk, the number of police and firefighters on the street and the number of luxury hotels and championship golf courses they can operate.

I can live with that.

But can they?

Andy Prutsok is editor and publisher of the News-Herald. He can be reached at 934-9611, or via e-mail at