On September 24, 2007 a published report on New Castle County's ongoing finance problems quoted Councilman George Smiley,"There is no money fairy. If I could find a way to save everything we needed and didn't affect anyone, I'd do it." This related to Smiley's efforts to " reduce future property tax exemptions for seniors and the disabled."

Now fast forward to January 15, 2008, the monthly meeting of the Civic League of New Castle County where the prime speaker was Michael Strine, Chief Financial Officer of the New Castle County government. In his comments about recent property tax increases of 5% and 17.5% respectively, the unrelenting decline in revenue-mainly from the real estate transfer tax and the declining housing market, these quotes were included:

• "Real Estate transfer tax is most volatile...
• Building permits are off by 25%...
• 2009 projected deficit of $45 million has been reduced to $16.5 million...
• Pushed out day of reckoning to 2011."

The comments continued with the stark reality of either more spending reduction, or more revenue.

After the presentation a question came from the audience about untaxed acreage in " southern New Castle County that had been approved for development six months ago yet was still not being taxed." Thus the matter of roll-back taxes was presented. Mr. Strine responded that this matter was addressed by state law and that New Castle County could act only after "building permits had been pulled."

Now here's how the "State law" reads on farmland being turned into housing developments: "Farmland Assessment Act of 1968", Title 9, Chapter 83, section 8335 (d) "When land in agricultural use and being valued, assessed and taxed under the provisions of this chapter, is applied to a use other than agriculture, it shall be subject to additional taxes referred to as roll-back taxes..."

9 DEL 8335(d)(1) reads " If the change in land use occurs on January 1,2000 or thereafter such land shall be subject to roll-back taxes for the 10 tax years immediately preceding.."

9 DEL 8335(d)(3) reads "Roll-back taxes as provided herein shall become payable when the land is applied to a use other than agriculture...The terms "applied to use... include any of the following...(c) "The approval of a site plan or issuance of a certificate of occupancy which allows for non agricultural usage."

In early July, 2007, some 1222.38 acres along Boyds Corner Road, north of Middletown, was approved for the major subdivision called Bayberry, to include some 2000 new residential units, under the sponsorship of Councilman Bill Bell.

So where is the "Money Fairy" in this example?

In review of various properties listed on the New Castle County website one can clearly view the assessment rate of $15,000 per home site acre.

Now for the math:

Current tax rate: .0057 x $18,330,000= $104,481.00. Now go back to the ten-year portion of this law:

Who else does this oversight, or poor public policy affect?

The Appoquinimink School District has sought increased property tax revenue on a continual basis for the past (16) years. Due to constant housing development the need to construct new classroom space is ever present.

Here are calculations for Appoquinimink:

Would $3 million do better with the school district or the developer? Would it be better in the classroom or buying more land to develop, or more money to contribute to elected officials looking the other way?

Next week we will provide more calculations and untaxed parcels that are being "forgiven" by New Castle County government at your expense, quotes from independent economic surveys and studies proving that increased housing stock constantly increases your taxes, review of campaign reports including many thousands of dollars while elected official look the other way, and how certain well connected folks are benefiting and costing you higher tax payments.

Last note: The January 15,2008 Civic League meeting was also attended by Councilman George Smiley. As of this writing we cannot provide any update on his part to enforce 9 DEL 8335(D)(1) or (3)(c). Councilman Smiley attended this meeting as Charmin of the Council's finance committee. Please reread his comments above.

Also in attendance was Paul G.Clark, President of New Castle County Council.

Both of these elected officials voted for the (2) tax increases.

Stay tuned.

Chuck Mulholland, President, Southern New Castle County Alliance

Leann Ferguson, Executive Vice President, Southern New Castle County Alliance