Opponents of Amendment One, the constitutional question on the November ballot that would allow localities to issue more public debt without a public vote, said yesterday that supporters of the idea are deceiving voters about the true nature of so-called “tax increment financing.”
Chris Neely of the state chapter of the Americans for Prosperity Foundation, former State Supreme Court Justice Robert Orr, and Martin Eakes of Self-Help Credit Union and Self-Help Ventures Fund all said at a Raleigh press conference that the primary proponents of Amendment One, North Carolinians for Jobs & Progress, are selling a misleading slogan to the public.
“You will find nothing (on the ballot) that tells voters they are about to give up their rights to vote on these issues,” said Orr, director of the recently established North Carolina Institute for Constitutional Law.
Amendment One supporters have argued that the ability to raise property values in local government-designated “development districts” will attract jobs and revitalize communities. The values are increased by the presence of public bond-financed facilities, such as convention centers or infrastructure improvements. The extra tax revenues collected in the district pay off the bonds used to finance the special facilities, hence the term “self-financing bonds.”
Opponents of the amendment say such bonds are anything but “self-financing” because rising property-tax collections within a TIF district must be devoted to paying on the bonds. New development increases the demand for more local government services such as schools and law enforcement, they say, but because property taxes within the district would be consuemd by debt service, the bill is effectively shifted to the general taxpaying public.
Opponents further argue that the state constitution provides voter authorization for new debt as a vital part of the system of checks and balances, and Amendment One would issue a “blank check” to politicians.
Eakes, who runs a nonprofit lender, said Amendment One would greatly benefit his organization, but that he opposes the idea.
“I could support it if it didn’t have to be paid for,” he said.
The groups represented at the press conference said although they would be financially outgunned in campaign advertising on the issue, they planned a grassroots educational effort to defeat the amendment. Neely said the group would also do some television and radio advertising.
Paul Chesser is associate editor of Carolina Journal. Contact him at [email protected].