County Drafts Plan to Boost Revenues on Real Estate Fees
By JOSHUA SABATINI
A funding plan, drafted by county manager Carol Borer, proposes a new method for Dukes County to receive significant revenue while providing tax relief to Island towns.
The plan hinges upon passing legislation that would allow the county to impose a one per cent fee on the gross sale price of all real estate transfers in Dukes County, made up of the six Island towns and Gosnold.
The plan is modeled after the land bank which, under the Martha's Vineyard Land Bank Act, collects a two per cent land transfer tax on most real estate transactions.
Mrs. Borer said the proposed one per cent tax would exist separate from the land bank; the proposal would come under separate legislation, not as an amendment to the land bank legislation.
Mrs. Borer, who has worked on the plan since last summer, said she examined a number of different options such as increasing the deeds excise tax.
She began working on the plan after discussing with a number of commissioners the county's need for additional revenue.
But, she said, the state receives some of the revenue from county taxes and may be tempted to ask for a larger percentage in the event of any new tax increases.
The real estate tax, she said, ensures the money collected on the Island will remain on the Island.
The seven towns are assessed each year by the county. For the last fiscal year, the seven towns paid the county about $680,000. For fiscal year 2003, the combined assessment rose to near $700,000.
Collecting a one per cent tax on real estate transactions, the county would have brought in for the last fiscal year about $3.5 million.
In the Sept. 10 document entitled County Funding Plan (CFP) Proposal, Mrs. Borer recommends the county take over funding for the Martha's Vineyard Commission (MVC).
For last fiscal year, the MVC's total assessment to the Island towns was about $500,000.
In the Sept. 10 draft, Mrs. Borer said bringing the MVC into the plan would provide further tax relief to the towns and provide the MVC with "a reliable revenue source they desperately require."
Mrs. Borer emphasized she has yet to discuss the proposal with the MVC, but she realizes the commission has been "struggling for money."
She pointed out that West Tisbury had a line item for the MVC assessment at their last town meeting.
Mrs. Borer, as stated in her draft plan, believes the funding plan would also help the county provide additional regional services to the towns.
"Although the county has taken strides in the last several years to provide more regional services to the towns - expanding or introducing services such as the county engineer, rodent control program, health access coordinator, veterans agent and grant writing - we could be doing more," the proposal said.
Other tax relief areas outlined in the plan include assistance in the towns' appropriations for emergency medical technicians and councils on aging.
For the last fiscal year, the towns spent a total of about $600,000 on EMTs. This sum grew to $650,000 for fiscal year 2003.
The towns appropriated $700,000 for councils on aging in the last fiscal year, a figure that grew by about $7,000 for this fiscal year. In her draft proposal, Mrs. Borer said she expects "a significant number of people requiring senior services within the next several years."
Mrs. Borer suggests that there is a real probability that the legislature will approve the plan for two main reasons:
* The legislature is under siege by all segments of the commonwealth to provide funding for housing, health care, education and local services. The county funding plan would not only relieve the legislature of great pressure from Dukes County and may create a model approach for other communities in the state.
* There is already somewhat of a precedent in Barnstable County. It is always much easier to reference a precedent rather than be in the role of breaking new ground.
Mrs. Borer stressed that the most important force in creating this legislation is community support. The county manager said the plan is in its incipient form. She plans to meet with the chairman of each town's finance committee to discuss the draft, as well as with others.
She said she will bring the funding proposal before voters at the annual town meetings. If it passes, she expects to establish a representative committee to push the legislation on Beacon Hill.
The proposal, said Mrs. Borer, does not necessarily mean the county's assessment to the towns would vanish, but it would be reduced.
"Perhaps we should look at reducing the assessment by a certain percentage over the next few years," said Mrs. Borer. "What if 10 years from now, the real estate transactions decrease dramatically?"
While the proposal would give the county more involvement in town business, Mrs. Borer said the plan is not intended to increase the county's power over Island towns.
"We want to help the towns, to give back to the towns," said Mrs. Borer. "We do not want to interfere, and we are not looking to regionalize anything."