Downtown Greensboro Inc (DGI) President Zack Matheny had a tough act to follow at the DGI luncheon on Wednesday after Roy Carroll the owner of the Carroll Companies made the announcement about his $140 million mixed use development currently called Carroll South of the Ballpark.
But Matheny made some good points, even if the room was still buzzing about the announcement of largest development ever in downtown Greensboro.
One of the many things that Matheny talked about was why local government, in particular the Greensboro City Council supports developers and used as an example Carroll Bellemeade which seemed appropriate since the luncheon was held in the Hyatt Place that is at the center of the Carroll Bellemeade development which includes about 300 apartments many of which are still under construction.
Matheny resigned his seat on the City Council to take the job as president of DGI and he said that sometimes he puts his council hat back on and in that light he presented some figures for what the Carroll Bellemeade project means for city and county budgets.
There are two ways for local governments to get an increase in the revenue from property tax which is their major source of funding. One of those is to raise the tax rate and the other is for the value of the property being taxed to increase. Since elected officials like to get reelected they generally prefer not to raise property taxes. That leaves increasing the value of the property being taxed.
Matheny pointed out that the increase in value of the property at Bellemeade and North Eugene streets has been considerable and the project hasn’t been completed.
In 2018 the property at 300 N. Eugene St. was valued at $741,400 and the total city and county property tax paid on it was $10,105.
Today the value of the property is over $13 million and the estimated property tax is $178,000.
For 304 N. Eugene St. the value in 2018 according to the county tax department was $3.7 million and the total tax bill was $50,116. Today the estimated value is $30.3 million and the estimated property tax is $412,455.
So for those two properties the increase in property taxes is over $530,000 and that is an additional $530,000 that the city and county will be collecting year after year, plus the project isn’t complete so that number will go up.
It also doesn’t include the hotel/motel tax or the sales tax paid by the hotel.
But it does include the additional 8 cent Business Improvement District (BID) tax paid by downtown property owners which is near and dear to Matheny’s heart since that revenue is used to support DGI.
There were no incentives paid out for Carroll Bellemeade, but the city did close a portion of Lindsay Street, so it no longer intersects with Eugene. The city gave up half a block of a street and in return will receive more than $500,000 a year in additional property tax for the foreseeable future.
Matheny didn’t talk about it, but there is even better news across the street at Carroll South of the Ballpark estimated to cost $140 million. A couple of years ago all of the property being developed was owned by Guilford County so it was untaxed. Carroll bought the 1.5 acre lot on the corner of Bellemeade and Eugene Streets from the county for $1.5 million in 2016, so that went on the tax rolls. But the bulk of the property was still owned by Guilford County, who sold it to Greensboro who sold all but what was needed for a parking deck to Carroll. So all but the city owned parking deck will go back on the tax rolls with considerable improvements including a nine story hotel and a 20 story office tower. The property tax paid whatever it is will be a 100 percent increase over what the city and county were receiving.