By Timothy Cox
tcox@dailystandard.com Real estate and manufactured home transfer fees are set to increase 150 percent June 1 and could see another bump when the state budget is finally approved.
Mercer County Commissioners have raised the local share of the fee from $1 to $2.50 per $1,000 of the sale price of land, homes and manufactured homes. The increase is expected to pump an additional $150,000 into county coffers.
The increase would raise the transfer fee of a $100,000 home from $100 today to $250 when the increase takes effect June 1. The increase could be blocked by a petition referendum, which would send the issue onto an election ballot for voters to decide its fate.
Commissioners approved the increase last week after holding two public hearings on the issue in March. They scaled back their original plans to raise the fee by $2 and instituted a $1.50 increase per $1,000 of real estate value.
Gov. Bob Taft has included another $1 fee per $1,000 of value as part of the current state budget proposal. If that is approved by legislators, it would raise the local fee to $3.50 per $1,000. The public hearings were mostly attended by real estate professionals, who complained about the proposed increase. Some of them argued the extra $200 or $300 could be a serious impediment to first-time home buyers. The transfer, or conveyance fee, also takes on more financial importance as interest rates rise and more potential home buyers are squeezed from the market, they said.
County officials say an increase in the conveyance fee is necessary to offset other hits the county budget has suffered in recent years. Along with stagnant revenue, the county also is facing a 20 percent cut in state funding to local governments, which amounts to about $191,640 annually.
County officials also said the increase would help fund the computerized mapping system maintained by the Tax Map office. The system, called Geographical Information System, costs about $421,000 to staff and maintain annually. Additionally, the system cost $454,000 to set up and install and it has seen $206,000 in software upgrades and other improvements.
Mercer County is one of only seven counties statewide that has a current transfer free of the minimum $1 per $1,000. State law allows counties to charge as much as $3 per $1,000 on top of the base $1.
Even with an increase to $2.50 per $1,000, Mercer County will have lower conveyance fees than more than 70 Ohio counties, county commission Clerk Kim Everman said.
There were 1,935 real estate transfers in the county last year and another 137 transfers of manufactured homes. However, about 35 percent, or more than 600, of those transactions involved tax-exempt entities not required to pay the conveyance fee.
With no financial cushion, county officials are forced to look for ways to generate new revenue, commissioners said. County revenue has been flat the past four or five years, and Mercer County spends about $1.5 million per year less than comparably sized counties, including Champaign, Clinton, Darke, Preble and Shelby counties. |
