Published on: 2005-09-07

Owners of homes about to be annexed by Fayetteville will get two bills next year that will double how much they owe in local property taxes.

Fayetteville plans to take in neighborhoods home to more than 42,000 people, mostly in western Cumberland County, at 12:01 a.m. Sept. 30. Lawsuits held up the annexation, the city's largest, for more than a year.

The annexation will affect about 20,000 parcels.

Tax Administrator Aaron Donaldson said landowners in the annexed areas will pay 21 months' worth of city taxes next year.

That alarmed several commissioners, who worried that some people would not be able to afford such an increase.

"I think this will be extremely difficult," Commissioner Diane Wheatley said.

Dave Allred, president of Carolina Mortgage Co., said after the meeting that mortgage companies will pay the higher tax bills and typically spread that cost without interest over 12 months. Those payments could rise by $100 a month, which could cause payment delays or foreclosures, he said.

According to an example that Donaldson gave to the commissioners Tuesday, the owner of a $100,000 home can expect to pay $918 in local taxes that will be mailed around Sept. 30.

That same homeowner next year will get two tax bills - one in August and one in September - that will total $1,807 and become delinquent Jan. 6, 2007.

The following year, the tax bill for an annexed home will drop to about $1,400.

The figures exclude other fees, such as for the landfill or for storm water, that are on property tax bills.

Commissioner Tal Baggett worried that the county would be the recipient of taxpayer angst. He wanted the county to mail a special flier in next year's bills explaining the increase. He said the extra taxes would go to Fayetteville, which has a contract for the county to collect taxes.

"We are going to feel the brunt of this thing, even though I think all of us have gone on record of opposing this annexation," he said.

County Attorney Grainger Barrett said state law prevents the county from collecting city taxes this year on annexations after Sept. 1. He said allowing people to voluntarily pay part of the extra taxes early or through installments next year would be a "paper nightmare" and hurt local governments' budget plans, which look at tax collections to estimate new revenues.

Homes outside of Fayetteville also pay a combined 15.5 cents per $100 in value for fire protection and recreation. With bills that go out this month, homes in the areas to be annexed will be billed for only three months of fire and recreation fees. The new city tax bills next year will cover those costs.

Baggett said the reduction in this year's county fire and recreation taxes is the only flexibility the county can offer under state law.

Commissioner Billy King replied, "Whoop-de-do."

Baggett said county and city officials have agreed that the best policy is educating the public and urging people to start saving now.

The Tax Office will notify mortgage companies and real-estate agents. City officials have said they will mail newly annexed residents notices to prepare for the extra taxes.

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WHAT WILL IT COST?

The owner of a $100,000 home in an area to be annexed can expect to pay $918 in local taxes that will be mailed around Sept. 30. That same homeowner next year will get two tax bills that will total $1,807.

Staff writer Andrew Barksdale can be reached at barksdalea@fayettevillenc.com or 486-3565.