In the next couple of months, property owners will be notified by the appraisal district if there has been a change in the value of their property. Likewise, many property owners will be protesting assessments. If the local economy doesn't support the values assigned to local properties and 2012 property sales prices show declines, property owners will have some solid ground to protest. In turn, local government will have some tough decisions; either cut expenses and reduce services or raise taxes. Fortunately there is one other alternative. Our county and city governments could work together taking proactive roles in economic development, providing the incentives and funding to encourage responsible development and attract desirable businesses. Without proper planning, development will occur, but most likely it will not be responsible nor will it be desirable. In less than two years, Hurd Regional Medical Center is anticipated to be fully operational, creating 500+ new jobs a stone's throw from Round Mountain, 15 minutes from Johnson City and 30 minutes from Blanco. Five hundred families will be seeking homes and places to eat, shop and purchase services. Some will go north, but many will seriously consider Blanco County before making a move. What is being done by local government to embrace and shape this opportunity? Or, are they just watching it happen?
Property tax is the single largest revenue source to fund local government. In a thriving economy, commercial real estate typically has a higher value than residential. As a result, commercial property owners pay higher property taxes than nearby residential property owners. For example, in Johnson City, 301 E. Main is a commercially-designated property with a 2000 sq ft building on 6510 sq ft land taxed in 2012 at $2843. Located next door at 309 E. Main is a residentially-designed property with various buildings totaling over 2000 sq ft on 16,117 sq ft land taxed at $723. A positive business climate supports higher commercial property values relieving residential property owners of higher taxes.
Sales tax revenue is another major contribution by business to offset expenses incurred by local government. March is halfway through the fiscal year for local government, making it a good time to get a snapshot of how local government is doing. While sales tax collection across the state is up 8.67% for the current fiscal year compared to prior, we aren't doing so well locally. This is how we measure up: Blanco County is up 2%, Round Mountain is up 7%, Blanco is down 3% and Johnson City is down 12%. If commercial property values decrease and sales tax revenues from local businesses are down, where will the revenues come from to cover local government expenses, including many of our elected official salaries? Watch your property tax bill to see.
Additional contributions are made to the local economy through hotel tax collection by Johnson City and Blanco lodging establishments. Hotel tax doesn't support local government general revenues, but instead is used to bring visitors to our area who, in turn, patronize local businesses and often find our area to be where they want to put down roots. A new citizen to our community often builds a home, resulting in an increase in the property tax role, maybe starts a new business, and, more likely than not, becomes a willing volunteer to lend a hand in the community when asked.
The impact of local businesses doesn't stop at their bottom line revenue contribution to local government. Local businesses are often the face of our community to the outside world and while some businesses sell products that contribute little sales tax, they are valuable contributors to our local economy through job creation. Each local business has taken a risk in locating in our community. Speaking of community, most local business owners are always willing to donate to community fundraisers and many contribute personal time to help improve the community as a whole. If our local businesses thrive, it is 'good business' for every citizen.
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