Prepare Now For Population Tsunami

At a press conference at the NC State Legislature in Raleigh this morning political and business leaders announced a new coalition, Partnership for North Carolina's Future, to urge the NC General Assembly to prepare now for the impact of the "population tsunami" on our state's economy and quality of life.

RALEIGH – The Partnership for North Carolina’s Future, a coalition of groups advocating increased state investments in school construction, affordable housing, roads, land and water conservation, and water and sewer services, urges the General Assembly's action.

Members of the partnership include Land for Tomorrow, the North Carolina League of Municipalities, the North Carolina Rural Economic Development Center, the North Carolina Housing Coalition, the North Carolina Association of County Commissioners, NC Go!, and the North Carolina Metropolitan Coalition.

According to the partnership, North Carolina is facing a “population tsunami” that the General Assembly must meet with significant new capital investments to protect the state’s economy and quality of life.

At a news conference today in Raleigh, Tom Lambeth of the partnership urged the General Assembly to take “bold steps to protect the basic foundation upon which our communities’ quality of life and economy is built – schools, roads, clean water and land protecting natural resources.”

Lambeth is chairman of the Rural Economic Development Center board of directors and former director of the Z. Smith Reynolds Foundation.

“We stand together to say to the public: Your future is at risk,” said Lambeth. “If the General Assembly doesn’t address these critical needs now, it will cost our state jobs, damage our economy and adversely affect the livelihoods of families across North Carolina.”

Lambeth said North Carolina is facing a “population tsunami” of four million people arriving between 2000 and 2030 for a total of 12 million, or a 50 percent increase. That will make North Carolina the seventh largest state, ahead of both Michigan and Ohio, and up from the current ranking of 10th.

Such a population increase will be nearly equal to South Carolina’s current population of four million. “We’ve got to build the equivalent of a new South Carolina within this state,” Lambeth said.

“We are falling behind,” Lambeth said. “Existing sources of revenue are not enough to keep up with the combination of aging facilities and extraordinary population growth.”

He pointed to:

* More than 178,000 K-12 students go to school every day in mobile units.
* More than 3,000 miles of streams and rivers do not meet clean water standards.
* More than 100,000 acres of forests, farmlands and natural areas are lost annually to Development.
* Jammed roads and long-delayed highway construction plague cities and towns statewide.
* Rural communities with inadequate and aging water and sewer services that create potential public health hazards.
* More than two million people living in substandard housing or housing they can’t afford, which contributes to health problems in children.

According to Dr. June Atkinson, state superintendent of public instruction, North Carolina school systems need to build 258 schools, or one per week on average every week for five years. Another 1,000 schools need renovations and still another 1,000 will need renovations during that five-year period.

“Whether it’s rapid growth, poor roads, worn-out school buildings, or aging sewer lines and the lack of clean water, this state needs to make the necessary investment to repair, replace and get ready,” said Asheville Mayor Terry Bellamy.

The partnership said that all funding options should be on the table to address the needs. Those include bond referenda, the local option land transfer tax, impact fees and the highway use tax. More than 50 bills have been introduced recommending new sources of capital investment funds for schools, roads, affordable housing, water and sewer, and land that protects natural resources.

For more information about the Partnership for North Carolina’s Future, visit www.ncfuturenow.org

Partnership for North Carolina's Future

Breaking News:
A new coalition called Partnership for North Carolina's Future has been formed to address North Carolina's growing pains and will be having a press conference this morning at 10am at the NC Legislature

Support The Transfer Tax

The costs of growth are predominantly the costs of building schools and infrastructure. As everyone in the real estate industry, (other than Realtors) knows, in recent years construction inflation has far outpaced normal inflation, as reflected in the Consumer Price Index. With high construction costs and rapid growth many local governments can only turn to property taxes for additional revenue. There is an alternative that 7 NC Counties already have: a Land Transfer Tax option that 6 of those counties exercise. It is time for all NC Counties to have the revenue options that these counties enjoy. It's time to support the Transfer Tax option to provide fair funding for good growth and to ease the property tax burden for seniors and others on fixed or low incomes.

NC Realtors Up The Ante

The North Carolina Association of Realtors filed a lobbying expense report May 14th that shows "Principal" lobbying expenses of $115,312.89 for the month of April. This does not include amounts paid to registered lobbyists which are reported separately. This brings the total amount of NCAR "Principal" lobbying expenses since January 1, 2007 to $366,115.16 spent mostly on a media campaign in opposition to proposed land transfer tax bills.

The April expenses include $18,561.31 for a "Legislative Reception" at the North Carolina Museum of Natural Sciences on April 17th. The report describes 65 designated individuals attending with 3 immediate family members. Names of legislators are not listed though are not required to be.*(see below) The expense amounts to $272.96 per head.

The report also lists a $5,000 per month retainer to Public Solutions, Inc., the firm of Chris Sinclair who also runs the Triangle Community Coalition, an organization of builders, developers and realtors (formerly known as the Wake County Real Estate and Building Coalition) which is also actively opposed to local government funding option bills that include a land transfer tax for schools and infrastructure.

Public Solutions' other clients include Craig Davis Properties, a company heavily involved in South Carolina public-private partnerships, a construction project delivery method heavily promoted by the Triangle Community Coalition particularly for school building.

An amount of $10,000 is listed as "Contribution to Save Our Summers grassroot effort" at the address of the North Carolina Hotel & Motel Association which provides administrative support to the organization. Save Our Summers has been active in Wake County in opposing mandatory year-round schools and year-round school conversions and has been openly critical of the Wake County Board of Education which is struggling to accommodate phenomenal growth in the student population.

* NC Lobbying Laws include the following:

"When more than 15 designated individuals benefit from a reportable expenditure, no names of individuals need be reported provided that the report identifies the approximate number of designated individuals benefiting and the basis for their selection, including the name of the legislative body, committee, caucus, or other group whose membership list is a matter of public record in accordance with G.S. 132-1 or including a description of the group that clearly distinguishes its purpose or composition from the general membership of the General Assembly. The approximate number of immediate family members of designated individuals who benefited from the reportable expenditure shall be listed separately."

In the case of the Museum event NCAR did not correctly report "the basis for their selection" for the "designated individuals" who actually benefitted. The NC Realtors' report listed invited attendees as "all members of The NC General Assembly, Council of State, NC Supreme Court, NC Appeals Court." This blanket invitation approach circumvents the specificity required if 16 or more people show up. Looks like room for a tractor-trailer to drive through.

Realtors Will Kill Golden Goose

In a timely article in the Carrboro Citizen, Moses Carey, Jr. writes:

What is a land-transfer tax and why does Orange County need it?

Here are a few snippets from the full article:

Transfer tax does not impede growth

It has been said that a land-transfer tax would stifle growth, but that is not true. Four of the counties with a land-transfer tax rank among the 20 fastest-growing counties in the state from July 1, 2000 through July 1, 2006, according to figures recently released by the U.S. Census Bureau. All four experienced growth in that time frame that was significantly above the state’s growth rate of 10 percent. It is also telling that five of the six counties with a land-transfer tax rank among the top 10 counties in the state in per capita education funding.

$13 billion too much for property tax alone

Over the next five years, North Carolina counties are faced with almost $10 billion of public school capital needs and are projected to spend more than $3 billion to help the state pay its Medicaid bills. That is too much of a burden to put on the property tax alone.

Realtors will kill golden goose.

According to the Tax Foundation, 36 states already have a statewide or local land-transfer tax in place. If North Carolina counties are not given some additional revenue options to help meet school and other needs, realtors, homebuilders and all of the public will learn that the growth that has been leading to increased home sales — and increased profits for realtors and homebuilders — will soon be a thing of the past. Realtors and homebuilders surely understand the value of lower property taxes and great schools in maintaining the quality of life for all residents as well as a vibrant business environment.

Realtors will kill the Golden Goose that lays their Golden Eggs if they continue to oppose funding for the public amenities that keep our communities healthy, productive and prosperous.

Six Percent on 60 Minutes

Six Percent on 60 Minutes

Realtors’ sacrosanct commission rate of 6 percent may be in jeopardy due to emerging online competition from Internet real estate sellers and buyers. Lesley Stahl reports.
(CBS) Sunday night, May 13, 2007, 7 p.m. ET/PT.

[Click to Watch: Introductory Video by Lesley Stahl]
Update:
[Click to Watch: 6% Story by Lesley Stahl]

Camden County Can't Get No Respect

Camden County is so poor it wants a landfill to import trash from other states to generate franchise fees that would pay debt service on a loan for a school addition and sewer extension that could not be built without also getting a rural development loan from the US Department of Agriculture to renovate the existing school.

Camden has a small but rapidly growing population and very little commercial property that normally supplements the operating costs of providing public services in residential areas of NC counties through property tax.

Despite some of the current regulatory curbs, Camden grew from 6,885 people in 2000 to 8,967 in 2005, making it one of the fastest-growing counties in the nation.

The North Carolina Association of Realtors has the audacity to say that Camden County, one of a handful of NC counties with the authority to impose a land transfer tax, has "artificially low property tax rates". Yet Camden, at $0.900 per $100, has one of the highest county wide tax rates in the state and still struggles to meet the capital needs associated with growth. Out of 100 counties only Edgecombe, Gates, Orange, Scotland, Vance and Hertford have higher county wide tax rates than Camden but the NC Realtors still think it is "artificially low". By comparison, Wake County's county wide tax rate is $0.634 per $100 (NCDOR).

How high do NC Realtors want property taxes to go in Camden County to pay for Medicaid share and the capital costs associated with growth? The highest county wide rate in the state?

I tell ya, I get no respect at all. I was drowning. I was yelling, "Help, help!" The lifeguard came over. He said, "All right, buddy, keep it down, keep it down."

           Rodney Dangerfield

FTC, USDOJ Antitrust Real Estate Brokerage Report Released

The Federal Trade Commission and US Department of Justice released a joint report, "Competition in the Real Estate Brokerage Industry" on Tuesday on restrictive practices in the real estate brokerage business that can prevent people from getting the best deal when buying or selling their homes.

Regulators said that discount brokers and other rivals to traditional agents have been constrained in their ability to use the Internet to reduce fees and improve service.
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The median real estate agent's commission increased 25.5 percent to $11,549 between 1998 to 2005, the report said. The FTC and DOJ called for more study of commission rates and fees and how they are affected by housing market conditions and regulation

Read about it in:
Business Week
Media Newswire
USDOJ/Antitrust: Competition Policy and the Real Estate Industry

Because real estate broker commissions are typically a percentage of the home sales price, the dollar amount charged by real estate brokers has increased significantly in recent years as home sales prices have escalated.
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The increased ease with which home buyers and sellers can perform tasks that once were the exclusive domain of real estate agents and brokers likely has been an important factor in the increased demand for innovative, non-traditional real estate brokerage services
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There are some indications that consumers are not enjoying all of the possible benefits of competition in the real estate brokerage industry. A number of developments have raised competitive concerns, particularly laws and regulations in some states that limit consumer choice of real estate brokerage service offerings and that prohibit rebates to consumers, anticompetitive agreements among brokers, and industry practices that impede competition. These practices can lead to substantial consumer harm through reduced choice of real estate brokerage services, higher fees, and limitations on the ability to access information about real estate listings.

Brad Paisley Sings It

Brad Paisley wants to see you in the sticks.

He sings it better than I can.

Realtors Opposed to a Vote of the People

Chris Fitzsimon writes at NC Policy Watch       [Click to listen]

The propaganda battle over the real estate transfer tax continues, with the N.C. Realtors Association insisting that adding a one percent tax on the sale of homes will mean an end to civilization as we know it and bristling at any mention of the six percent they charge home sellers. That fee brought in close to $1.7 billion for realtors in North Carolina in 2006. That’s another figure they would rather not be mentioned.

The realtors’ power in Raleigh is undeniable. With their PAC and well-connected lobbyists, they are used to having their way. That’s why it is refreshing when a lawmaker stands up to them and their refusal to consider sharing in the costs associated with the growth that brings them their billions.

That’s exactly what Freshman Rep. Cullie Tarleton did recently, telling his local paper that the realtors claim that the transfer fee is a home tax is misleading and that no one wants to literally tax homes. Tarleton also points out that the legislation doesn’t impose the tax, it only allows local governments to consider it and only after a vote of the people.

Good for Tarleton for speaking his mind and not being intimidated by the realtors’ money and misleading spin. The point he makes is one that the realtors have yet to address.

Why don’t they want to let people in North Carolina have a say in how to pay for new schools in their counties?

Don't Sell: Remodel and Save

Next time you think about buying a bigger home because you need an extra bedroom or bathroom think about remodeling instead. You could save big bucks on the transaction, enhance the equity in your home and get the features you need. Why pay 6% of the full value of your home in real estate fees when all you want is a few more rooms? On a $200,000 home that's $12,000 that could go towards the bathroom you need for your growing family.

Remodeling Magazine has an annual Cost V. Value Report that is eagerly awaited by homeowners and remodeling contractors every year. The average direct return on remodeling investment is 84%. On a $200,000 house that means you could afford to spend $75,000 on remodeling and still break even on transaction costs. Take a look at the Alternatives links on the right-hand side of the homepage for remodeling tips, ideas and information.