Holly Springs Eyes Higher Millage Rate

Holly Springs faces a $100,000 decline in revenue in the next budget unless it raises the millage rate, Finance Director Rob Logan told the during a work session Monday night.

The value of taxable property in the city has declined by more than $18 million, Logan said, and the city needs to set the tax rate at 5.469 mills to bring in the same revenue next year as this year.

That’s an increase of 0.321 mills from the current rate of 5.148 mills. That would add about $25 to the tax bill for a house with a fair-market value of $200,000—if that home's value didn't change from year to year.

The city also raised the rate the past two years to offset falling property values. It previously cut the rate twice in three years to get from 4.921 mills in 2006 to 4.629 mills in 2009.

No one from the public addressed Logan’s report, which was based on figures from the Cherokee County Tax Assessor’s Office.

Mayor Timothy Downing indicated his support for a millage rate increase.

He said the city has always rolled back extra property taxes to the public to remain revenue-neutral in times of rising property values, and “it’s got to work the opposite way as well.”

The city needs the rate increase to bring in the same property taxes and keep the same services, he said.

“We can’t absorb anything other than revenue-neutral to maintain services,” council member Dee Phillips said.

She said the $18 million-plus drop in property values is a lot for a small city to absorb.

The mayor added that the city also has lost $400,000 in development revenue the past few years because the bad economy has halted development in the city.

“The city has been extremely responsible,” Downing said.

The council took no action on the millage rate Monday. It typically adopts the rate in September, and property bills go out in December.