To tax or not to tax, that is the question

I’ve been watching (and commenting on) some of the commentary swirling around Facebook about the proposed 4 mil property tax aimed at helping Whitfield Regional Hospital (WRH) in Demopolis. There seems to be some incomplete information and even some misinformation about the tax. I’m not here to try to sway anybody’s vote and I’m not here to give you all the facts – I don’t know all the facts and maybe even don’t want to. But, I did have some questions of my own and had a few friends who had questions that I thought needed an answer. So, I attended the meeting at WRH on Thursday night to see what I could figure out. Before I go further, I am not planning to use big words, economic concepts or anything else that I don’t understand. I’m not an economics guy and I don’t understand all the legal jargon.

The first thing that I noticed was the lack of attendance by anyone other than hospital employees, hospital board members and county commissioners. As best I can recall, there were 9-10 people not affiliated with WRH, in some form, in the room. If you want answers, you have to show up and ask questions. Now, I do realize that there were 50 or so people who attended the meeting on Tuesday. Along those lines, there is another meeting at Cornerstone Church in Linden on December 3 and they are trying to finalize a location and time for a meeting in Dixons Mills. I can tell you that the sanctuary at Cornerstone is much larger than the meeting room at WRH. If you have questions, please try to make it to that meeting and do not be afraid to ask them. Doug Brewer, CEO at WRH, will try to answer all your questions.

The first thing that I will address is the concern about business properties paying higher taxes than residential properties. (I have some friends who were asking why their business tax would be more than a house of the same value. I have my own business, too.) This is something that the state of Alabama decided long ago. This has nothing to do with the hospital, the CEO, the county commissioners or anyone local. There are several tiers to the taxes levied on businesses and properties. Please keep in mind that this is the assessed value, NOT the tax for the hospital. Utility company properties are taxed at a 30% rate. Other business properties are taxed at 20% and residential properties at 10%. One exception is the Demopolis Historic Business District, which is in the 10% category. That said, if my house value is assessed at $100,000, I would pay another $40 per year on my house. If my business is located on Highway 80, and valued at $100,000, I would pay another $80 per year on my business. Most of you can do the math to figure out what that would add to your own tax bill.

Many people, including me, were wondering why a sales tax is not a good answer. The reason for that is that the sales tax is fluid. It can fluctuate depending on how much people are buying. County sales tax revenue could be (just a number) $200,000 one year, $150,000 the next year and $225,000 the next. Property tax is not as fluid. Unless your house/business burns down, your property is going to, for the most part, hold its value. Banks will lend the hospital more money (higher percentage) when they can show a steady, consistent stream of revenue from property taxes. It has been estimated that 4 mil tax will generate $950,000 per year that banks and lending institutions feel comfortable lending money against. Additionally, a sales tax is not protected. That revenue can be redistributed – for roads or other uses. Property tax revenue must be used for the intent that the tax increase was done. This tax increase would go to the hospital, nowhere else.

Several people have used the word unfair regarding the tax. I can see why you could think that. I wondered about that myself. One thing that you need to realize and consider is that this is tax that applies to property (ad valorem). So, if someone OWNS a vehicle, a mobile home, a house, land, a pasture, a hunting lodge, etc., they will be paying the tax. So, more people than you think will be right there with you, paying that tax. If Billy Bob rents an apartment and has a bicycle for transportation, he doesn’t have to pay the tax. But, I’m sure his landlord, J.B., is going to pass that tax on to Billy Bob by raising his rent to cover the increase. That means Billy Bob is paying more, too.

I know that doesn’t answer all the questions, and that wasn’t my goal. I went to the meeting and asked questions that I wanted answers to and threw in a couple for some of my friends, to try to help out a little. My first thought was “not ANOTHER TAX” when I heard about it. But, I will tell you where I personally stand. I have personally used the services of the hospital in Demopolis three, maybe four times in my almost 50 years on this earth. Once, when I was born. Once, when I had a wreck on a basketball court that required an ambulance ride. I didn’t get to decide for myself – I was in and out of consciousness. I’ve been a couple times for diagnostic imaging – kidney stone scan. Point is, I don’t use them much, but some others are not as fortunate as I have been. WRH needs some major upgrades. They need to replace the 50 year old boilers that provide heat for the hospital and steam to sterilize instruments. (Clean hospital utensils are good things to have.) They have some roof leaks. Their computer system is Windows 7 based. Microsoft will stop supporting Windows 7 in January 2020 – that’s just a couple months away. If the computers go down, a lot of things will stop working.

There are lots of reasons that having a local hospital is good – economically and for the well-being of all of us and our friends. I can’t think of any bad ones. Closing the hospital would have a ripple effect that takes a little time and thinking to really get a grasp on. As I stated perviously, I’m not trying to sway your vote one way or another. YOU have to do that for yourself. I just wanted to get some answers for myself and share some of those answers with some of my friends. I hope that I have filled in some blanks. I know I didn’t fill them all in. But, I feel like I understand more now than I did two days ago and I hope I helped you a little, too.