Marathon meeting likely on Tuesday at Davidson Town Hall

The Davidson Board meeting Tuesday has a packed agenda that will likely run late into the evening and run the gamut of local government subjects

Hot topics to be covered include:

• Property revaluation impacts.  See previous story here.
• Beaty Street Park recommendation
• Development project updates
• Road project resolutions for NCDOT
• Tree ordinance and historic preservation discussions
• Spring retreat prep

See full agenda here.

Davidson Board set to hear BIG property valuation update on Tuesday

On Tuesday, Davidson's Board will hear an update on the recently completed Mecklenburg County property revaluation, and the numbers are BIG.  According to the Town presentation attached to the agenda item, the town's overall tax base increased 31.1%.

If the tax rate rate were to stay the unchanged at 35 cents per $100 in value, that would translate directly into at least a 31.1% aggregate increase in tax bills.  The good news is that while we know certain staff like to entertain the idea of "value capture" as a way to increase tax collections by not lowering the tax rate to what's called revenue neutral, an average tax bill increase of this size from Davidson is unlikely.  Instead, the Town likely will lower the rate somewhat resulting in bills that will be smaller than they would if the rate was left unchanged.  The goal for taxpayers should be to push the Board to adopt what is called the "revenue neutral tax rate" or RNTR

So, what is the RNTR and how is it calculated?  The answer to that is much more complicated than you might think.  To get into the gory details check put this post from the UNC School of Government, but here is the gist of it.

"When the tax base changes, a local government would experience a change in revenue if its tax rate were to remain unchanged for the new fiscal year.  The RNTR is intended to show the tax rate that would keep the local government’s revenue neutral given its new tax base. Well, not exactly neutral: the statutory calculation increases the current year’s revenue by the average annual growth rate experienced by the local government’s tax base since the last reappraisal."

So what would the RNTR be for Davidson?

aShortChronicle asked that question of the Town in early February but was told it wasn't available yet.  Per former Public information Officer, Christina Shaul, "the Davidson Board of Commissioners have their budget/finance retreat from March 14-15, so I’d recommend getting in touch with Jamie Justice the week of March 18 to get the latest information on their thinking related to the revenue neutral and other tax rates."

aShortChronicle fully intends to follow-up on that question, but in advance of that, a quick analysis was done looking at the calculation spreadsheet supplied by the NC Treasurers office for municipalities to use.  You can see the spreadsheet here.  The spreadsheet requires one piece data, average growth rate, that will need to be calculated by the Town, but assuming that rate falls between 2-5 percent, Davidson's revenue neutral rate would be somewhere between 27.25 cents and 28 cents.  Incidentally, Davidson's population has been growing at about 2% per year in recent years, so hopefully the rate is on the lower end of this range.

Unfortunately though, things aren't that simple when it comes to actual individual tax bills, and some people, maybe a lot of people, will still see significant tax bill increases even if the Town has the financial discipline to implement a revenue neutral rate.  That's because not all properties change at the same rate, not even close.

Take a look at the below heat map from the Mecklenburg tax assessor's presentation showing how much properties increased across town.

What you will notice is that property west of Kimberly off of Davidson-Concord Rd increased at higher rates than property east of Kimberly.  In fact properties in Old Davidson and most areas West of Main Street saw significantly higher valuation increases.  Because of these significantly higher increases compared to the aggregate increase across town, these properties will have significantly higher tax bills even under a revenue neutral tax rate.  Effectively, this shifts some of the overall tax burden from East Davidson to Central and West Davidson - regardless of where the tax rate is set.

In coming months as the Board discusses what to do when setting rates for the next budget cycle, keep an eye on this.  Since almost all of Davidson's naturally occurring affordable housing exists on the West Side of Town, the Town will likely try to see how it can mitigate the impact of tax changes and tax payers need to ensure it is done fairly.

NOTE:  The above only covers the Davidson portion of the overall tax bill.  The bigger portion is from Mecklenburg County whose Board will almost certainly be nowhere near revenue neutral - ensuring the pain from the tax man this year is fealt by pretty much everyone.

Continuum FY2019 Q2 results.(press release)

DAVIDSON, N.C. – On Thursday, January 24, 2019, the Continuum (formerly MI-Connection) Board of Directors met to review second quarter financial results.

Continuum CEO David Auger presented financial results of the second quarter of fiscal year 2019 as compared to the second quarter of fiscal year 2018.  Total revenue is up 1.97%, EBIDA (earnings before interest, depreciation and amortization, a key metric used by cable operators to measure performance) is up 15.42% and total expenses are up 2.37%.  Revenue generating units (RGUs) are down 3.59%, and customer relationships are down 1.93% in FY19 Q2 versus FY18 Q2.

“Our customers tell us they are really happy with the internet speed increases we’ve implemented at no additional cost to them,” said Auger. “We are piloting a new program called ‘Continuum Unboxed’ which is a new way to stream the national cable line-up simply with Continuum’s internet service, providing a great alternative to our cable service.”

The Continuum Board of Directors will meet again on April 25, 2019 at 6:30 p.m. in the Davidson Town Hall board room.

For more information on Continuum, please visitwww.ourcontinuum.com and www.townofdavidson.org/miconnection.

About Continuum 

Continuum, formerly branded MI-Connection, is the community-owned and locally operated communications system proudly serving the towns of Mooresville, Davidson and Cornelius in the counties of Mecklenburg and Iredell in North Carolina. Continuum offers a Triple Play of Services including cable TV, high-speed internet and phone for both residences and businesses. For more information, visit www.ourcontinuum.com.   

New Davidson Gateway Development: Affordable Housing, Density Averaging, and the Griffith Street Hotel

Three weeks ago at the Davidson Town Board meeting on Tuesday, February 12th, a proposed new development was discussed on Davidson Gateway Dr.  The project would use the 3+ acre parcel on the south side of Woodies furthest from Griffith St as the last remaining parcel owned by Davidson Commons East LLC.  This is part of the same overall conditional planning area that includes Woodies and the two parcels for the controversial Griffith Street Hotel project.

At the meeting, Developer Saussy-Burbank was seeking feedback from the Board in what's now called a Pre-Development Consultation.  Having this kind of meeting in public is something new under the current Board which allows the public an early view into upcoming possible projects.  The discussed plan has 38 units, mostly single family homes, but it also includes a few duplexes.  The developer is interested in removing the conditional zoning designation and using the underlying Lakeshore Planning Area zoning.

The houses would include affordable housing built on site as part of the project - an increasingly rare thing in the current era of payment in lieu.  The price point of the market rate houses would also provide more affordable options in the town center than are currently available.  However, to achieve the desired density, the developer is looking to take advantage of what's called density averaging.

Density averaging is a process whereby a developer is allowed to overbuild on one parcel while permanently acquiring and preserving pervious area on another parcel in the same watershed area.

In this case the available allowed impervious area on Lot 4D as part of the Davidson Commons East development is an issue because the overall allowed impervious area is allotted to the entire development, not the individual Lots A-D.   Since the controversial, Griffith Street Hotel is still on the books as it works its way through the courts, there isn't enough impervious area left to accommodates this new projects without employing a gimmick like density averaging.

While this meeting in February of 2019 was the first public information provided on the project, public records show that something has been in the works for quite some time on this parcel.  Back in 2017, aShortChronicle obtained records showing this same developer discussing a project requiring density averaging on the same parcel.  The records from 2017 also indicate concern from Town staff regarding moving the proposed earlier project through the density averaging process at that time.  These requests are approved by the Board of Adjustment in a "publicly advertised meeting" that might draw "special attention".

Readers will remember in 2017, the controversial Griffith Street Hotel project was yet to be approved by the former Board.  That project was not approved until after the 2017 election in a lame duck vote by former Commissioners Beth Cashion, Rodney Graham, Brian Jenest, and Stacey Anderson.  Only Jim Fuller who was reelected voted against approving it.  The hotel approval has been challenged in court, and the citizens bringing the case won the initial decision.  The case is currently waiting for an decision on an appeal by the land owner and hotel developer.

Now, we have this new project on a different parcel that is part of the same overall development.  This new project however is constrained by the hotel approval which is still on the books as it works through the courts.

The combination of all these things poses an interesting trade off for the current Board whose members were not elected when most of these events occurred.  They are faced with supporting a residential project that will provide more affordable housing options, including built AH program units, but the cost of that very well may be using density averaging which raises concerns about water quality.  Furthermore, the density averaging is only necessary because of the controversial Griffith Street Hotel commercial project.  Finally, the benefit of the density averaging process accrues almost entirely to the landowner who may not be able to sell the property as easily without it.  However, that landowner also consciously chose to be in this situation by allocating such a large portion of impervious area to the hotel project.

The easy solution to all this is to simply not make any decisions on this new project until there is a final decision on the Griffith Street Hotel.  If the hotel project goes away, there is no real issue for the new Saussy-Burbank project as more impervious area would be available without resorting to density averaging.  Considering a residential project by Saussy-Burbank at this site has been under discussion for years now, not just recently, waiting a few more months seems like a small price to pay before the Town makes any decisions.