Earlier this month, the Chapel Hill Town Council approved a bid from the UNC Arts and Sciences Foundation to buy the old public library property at 523 E. Franklin St.
The Arts and Sciences Foundation bid $1.25 million and an additional $475,000 in place of paying annual property taxes. The town council approved the bid over a $1.8 million offer from Chabad, a Jewish organization that agreed to pay annual property taxes assessed on the property without limitation.
When one considers the obvious financial superiority of Chabad’s offer, the council’s decision makes no logical sense. The foundation’s bid will not only be smaller, including the additional money they will pay in place of assessed property taxes, than the Chabad’s total offer — it will also cause the town to lose out on property tax revenue it doesn’t seem to be in the place to be giving up for idealistic reasons.
And just this summer, the town of Chapel Hill approved its budget for the next fiscal year — and the budget will include a one-cent property tax increase for all residents.
Councilman Ed Harrison told The Daily Tar Heel in June the town will put the revenue from the tax increase into its debt management fund, using the money to pay off debts on current and future town projects. One would imagine paying off debt from Chapel Hill projects would require a lot of money.
Chabad’s offer was turned down at a July 2 Chapel Hill Town Council meeting because council members weren’t sure how the organization’s presence in the neighborhood would affect the surrounding community.
Councilman Jim Ward said at the meeting that he felt the University’s proposal would be the best use for the property. And letters and emails sent to the town council argued the foundation belonged more in the community than Chabad.
But it’s unclear how Chabad’s presence would negatively affect the community, and if possible negative effects are the reasoning for rejecting a better offer, the reasoning should be more transparent.
By worrying about the organization’s presence in downtown Chapel Hill, the town overlooked a much more important factor — in a year when it had to raise property taxes for all residents, it is turning down additional property tax revenue that could’ve prevented such a move.
