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VOL. 122 | NO. 77 | Friday, April 27, 2007

Despite Flat County Tax Growth, Suburbs See Increases

By Andy Meek

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SOMETHING TO BANK ON: New construction fueled growth in the local tax base, to one degree or another, throughout Shelby County over the past year. -- Daily News File Photo/Andy Meek

At roughly 1 percent, the growth in Shelby County's tax base over the past year was so minimal it was almost flat, according to certified property assessment figures released last week.

City officials in a few of the county's outer-edge suburbs, though, might look at those same numbers and find reason to smile. Municipalities such as Arlington and Millington saw double-digit percentage increases in their property assessments over last year.

Such growth that occurs during years that fall between the countywide reappraisal years is reflective of new construction - and, in a few recent cases, annexations that brought new properties onto the tax rolls.

The Town of Arlington, for example, saw an assessed value gain of about $29 million - a 16.2 percent increase over the previous year. One reason for such growth is homebuilding activity there has been sizzling.

"You know they say, 'Build it and they will come?' Well, we built it and they are coming," said Shelby County Trustee Bob Patterson.

In the last year, Patterson said, he's aware of at least 534 new homes in Arlington that were built, bought and moved into.

"Entire subdivisions came up out of the ground in 12 months and were on the tax rolls - that's just awesome," he said.

Rising, falling

The City of Memphis, meanwhile, got a roughly 3 percent bump in its assessed value, growth that appears to have come from two recent annexations, according to Louise Mercuro, formerly of the city-county Office of Planning and Development.

Memphis absorbed a 2.2-square-mile stretch of Cordova Dec. 31 that includes the Berryhill neighborhood. In June, the city annexed commercial properties in the Southwind and Windyke communities.

Consequently, the land grabs appear to be the reason the unincorporated part of Shelby County saw a 3 percent dip in its assessed value over the past year.

One reason the certified assessment figures are important to watch is that each local municipality will use them later this year to calculate property tax rates.

Property taxes, the main source of income for the county and almost all of its seven municipalities, are paid on a percentage of the appraised value set by Rita Clark, Shelby County's property assessor. Residential property owners pay taxes on 25 percent of their property's value; commercial and industrial property owners pay taxes on 40 percent of the value.

Suburban magnet

And as building activity in places like Arlington shows, the more homes go up, the bigger the haul in tax revenue.

"The new high school, of course, and also our elementary and middle school have been a big draw for a lot of people," said Ed Haley, Arlington's town superintendent, referring to Arlington High School, which opened in 2004.

Students returning in the fall as seniors will make up the high school's first graduating class.

"We've got some excellent educators and parent-teacher associations there," Haley said. "And I think that, coupled with the low taxes, are just all good anywhere you go. But it's been especially good to us."

To get an idea of how much Arlington taxpayers pay in relation to those in Memphis, a homeowner in Arlington pays $1 for every $100 in assessed value. Memphians pay $3.43 per $100 in assessed value.

Such factors have drawn developers and new homeowners like a magnet. And they keep coming; construction has begun on the Harrells Ridge subdivision, a 66-acre development that ultimately will have 122 new homes.

In 2006, the average value of building permits filed in the 38002 ZIP Code - which encompasses both Arlington and Lakeland - was $243,380, according to The Daily News Online, www.memphisdailynews.com. That was a 10 percent increase in the average building permit value from the previous year.

Dollar signs aren't the only part of Arlington's building activity that have been growing; the average size of building projects there hit 3,465 square feet last year, compared to 3,323 square feet the previous year.

Gateway Tire & Service Center has been looking for space for a new store in Arlington, as has McDonald's. The town's engineering department also is reviewing plans for the multi-million-dollar expansion of Wright Medical Group Inc., a medical device manufacturer that's the town's largest employer.

After Arlington, the municipalities whose tax base grew by the largest percentages were Millington and Lakeland - the former, by 12.2 percent, and the latter by 7.8 percent.

Lakeland recently took a giant step forward in mapping out future development in the town by enlisting the Chicago-based consulting firm Farr Associates to help the town fine-tune its development codes. Public meetings will be held soon to get citizen input on the effort.

"Here little Lakeland is just out there in front, on the cutting edge of this," said Rudolph Jones, a prominent landowner in the town. "(Company founder) Doug Farr is highly regarded for writing codes, and he's also the guy who did all the 'green work' for Mayor (Richard M.) Daley in Chicago in terms of writing green codes."

RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 116 288 17,672
MORTGAGES 143 337 20,372
FORECLOSURE NOTICES 0 11 2,656
BUILDING PERMITS 0 349 36,295
BANKRUPTCIES 40 155 11,319
BUSINESS LICENSES 35 93 5,802
UTILITY CONNECTIONS 0 27 6,741
MARRIAGE LICENSES 18 86 4,002