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Higher taxes could hit businesses hard

POSTED: June 12, 2008 5:00 a.m.
TOM REED/The Times

Jimmy Adams owns several businesses and rental properties that will be affected by a possible hike in the Gainesville school tax.

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While much has been written and discussed about the cost of a school tax hike to residential property owners in Gainesville, those who own businesses and rental property within the city are also bracing for additional costs they will have to pass on to customers.

For Tim Bunch of Longstreet Cafe, bringing home the bacon, or bringing it to his restaurant along with other food supplies, has been affected by fuel surcharges by providers. Bunch has tried to hold the line on prices, yet his dining business is not as robust as it was a few months ago.

He estimates the tax increase for schools could cost between $3 and $5 a day. "There's not a lot of margin in our business and we have to make it up somewhere," he said.

Kit Dunlap, president and chief executive of the Greater Hall Chamber of Commerce, said she has heard from individual business owners who are worried about the impact of higher taxes on top of rising energy costs.

"I've had several e-mails saying this is too much, particularly at this time of year, with businesses suffering," Dunlap said. "Fifteen percent is too much in a normal year."

But the tax increase may be closer to 20 percent, and that has businessman Jimmy Adams worried.
Adams' core business is a century-old moving and storage company, but his business holdings include a number of commercial rental properties within the city.

"The bulk of the tax burden is carried by the business community and the bulk of that is in the buildings they occupy," Adams said. "In our company's case, we have tenants from California, Virginia, Pennsylvania and Florida. We're going to pass on those tax increases to them as a part of their rent and we're going to be hard pressed to explain what has happened in our city to cause such a drastic increase because they're not familiar with the issues the school board has faced."

Adams said he's not looking forward to making those calls. He also said the budget deficit of up to $7 million the school board is facing wouldn't be tolerated by a private business.

"In the business community, the person responsible would no longer be working for me," he said. "When you're the ultimate manager, heads roll in the business world. It's a fact of life."

The tax burden for the moving-and-storage company will be felt in additional taxes on the company's truck fleet at a time when high diesel fuel charges are already wreaking havoc, he added.

He estimates the tax increase will cost his company $22,000 alone. "That's a salary, and if we have to put someone on the unemployment rolls because our taxes have gone up that much because of someone's mismanagement, that's bad," he said.

Adams, who has been active in economic development, also worries about the affect on businesses who are eyeing Gainesville as an expansion site.

"These are not the kind of things that companies that are looking to relocate their company and bring needed jobs to our community want to see," he said. "They want to see stability in our schools, our government, our medical community and transportation system."



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