The Guilford County Board of Commissioners has begun discussing a move that will make a lot of people in the county happy if the board follows through with it.
On Friday, Feb. 3, the second day of the board’s annual retreat, the commissioners briefly discussed raising the discount rate for early property taxpayers from a half of a percent to 1 percent of their tax bill.
This would essentially undo a move made by the Board of Commissioners in 2014 when that board – much to the dismay of many county property owners – voted to cut the discount rate for early payment from 1 percentage point to a half point.
Property tax bills in Guilford County are sent out in early July and the discount on bills is granted to county taxpayers who pay by August 31 each year or who get the check in the mail with a postmark of August 31 or earlier.
Currently, about 60 percent of the county’s property taxes are paid by August 31 each year. According to county staff, the half percent discount creates about $1.4 million in “lost” revenue. Each additional 0.1 percent of the discount generates a roughly $280,000 revenue loss.
However, that money may not really be lost according to the argument made by some backers of the move. While clearly taxpayers save more with a larger discount, the county would have much more money earlier to invest and draw interest on, and there are other big benefits to the county for getting more money in early. It helps with everything from financial planning to providing liquidity to the county’s balance sheet.
In places like Mecklenburg County, where there’s no discount for early payment, those payments usually come in very late in the calendar year, or at the last minute in early January.
Chairman of the Board of Commissioners Skip Alston said he’s very intrigued by the idea of increasing the discount rate and said there was momentum to make the change last year. However, he added, the change has to be made before May 1 each year and, Alston said, last year the board held the discussion too late to do it.
County budget staff and several commissioners seem very amenable to the idea and there doesn’t appear to be any real opposition to the move.
Guilford County Tax Director Ben Chavis told the Rhino Times at the retreat that he had never been in favor of reducing the rate and he would like to see the discount rate raised.
Chavis said the discount rate used to be even higher than 1 percent.
“The county’s discount rate went from 2 percent to 1 percent in 1993, when we started collecting for the City of Greensboro,” Chavis said of Guilford County Tax Department’s collection activities.