Letter to the Editor, Precinct Chair of GOP Speaks Out

Budget problems are not solved by levying tax increases; especially in an economic downturn. It distorts economic reality and complicates the budget problems. The problem in Forsyth County is not tax revenues, it is the size and scope of the government to include the school district.

The United States Bureau of Economic Analysis reports that Forsyth County's total personal wealth fell $6.3B down 4.9% from 2009. That represents $35,196 for each person in Forsyth County. If you look at the 2011 Budget Forsyth County government salaries now exceed total revenues generated by property taxes. Revenues are just over $88M with a total salary and benefit cost of $79M. Eighty-nine percent of all revenues pay government employees salaries, benefits, and pension. Property taxes bring in $76M or 95% of county revenues. One decade earlier property taxes were a mere 72% of total revenues and salaries were just 50% of total revenues.

Over the past decade. The number of employees in the county has exploded 55% to a total of 1,084 from 700 and salaries have jumped 200%. The average salary with benefits was $35,714 in 2000, but in 2010 that average has exploded to $72,878 or 104%. Salaries and benefits were 64% of property taxes in 2000; today salaries and benefits are 104% of property taxes.

This is unsustainable as personal income falls annually and the REAL median incomes falls. Forsyth County enjoyed economic growth over the past 10 years and ranks as one the wealthiest counties in the nation. The latest census reports the median household income is $88,040, but this number masks the truth. Since 2003 REAL incomes have fallen -0.8% per year due to inflation. This means that the REAL median household income in 2011 is now back to the income level of 2002. Forsythians use a higher percentage of their income to buy food, gasoline, and necessities than was needed in 2002. The reason sales tax revenues fall short is that Forsythians simply can't afford to buy as much. The same holds true of overall household wealth when you consider equity in homes. 

If you compare median home values vs. REAL home values over the past 10 years the fiscal tragedy reveals itself. The median home value in Forsyth County has plummeted to ~$212,000 in 2011 back to 2002/2003 levels. Yet, the REAL home value (adjusted for inflation) is $144,568 or pre-2000 levels. The wealth from home equity has evaporated and there is no end in sight of the wealth destruction. The tragedy is that this is the first time in American history that homeowners used equity to finance their lifestyles instead of saving for retirement. There is little equity left in homes and Forsythians are paying mortgages on underwater homes.

Forsyth County Commissioners and the School Board members need to understand there is no money left. Raising taxes is not the answer. Raising taxes on one source of revenues will reduce the tax revenue from other sources. Higher millage rates mean less SPLOST; more SPLOST means less sales. Likewise when you tax an immobile object like a home, all studies prove it tends to keep home values lower. It also constricts the tax base. We want to expand the tax base and help to raise home values. That is the only way to solve the problem.

Both the Forsyth County government and the school district need to shrink back into economic reality of 2011. They need to outsource any service provided by government that is currently being done in the private sector. This will increase the overall wealth of Forsythians. Use the savings to pay down debt and reduce taxes. The school district needs to increase the pupil to teacher ratio. A simple 13% increase will allow the school district to save $9,000,000 in salaries and benefits.

Do this and you will fix the budget problems. 

Bill Evelyn
Forsyth County Resident
Precinct Chair Republican Party