15 June 2007

Zorro v. the Tax Man

This morning on NPR I listened to a story about the state legislature's tax cut plans. Much of the plan has to go before the voters. I don't, honestly, know the shape of this proposal and to be honest I'm not sure I care. As I see it, the debate breaks down after the jump:

- The people have complained about property taxes, which have raised significantly because property values have been increasing.
- The state politicians, who want to be re-elected, want to cut property taxes.
- The people don't know anything about who levies what taxes and frankly don't care, either, as long as their tax burden is reduced.
- The state does not in fact tax property. The state authorizes the cities and counties to do so.
- The cities and counties do not want to cut taxes. They spend money on police and fire (public safety), water quality and waste disposal (environmental needs), zoning and comprehensive land use plans and enforcement (growth management), and transit, as well as bureaucracy and employee salaries.
- The state, over the past few years of economic growth and property price inflation, has seen tax income rise at the cities and counties and has directed them how to spend such money, primarily on environmental needs and growth management.
- Cities and counties were handling environmental and growth management issues themselves before the recent property bubble. But they were not abiding by state mandates, which have created rules cities and counties must abide by, as well as creating oversight bodies to ensure city and county compliance.
- Cities and counties now say that if their income is cut, they will still be required by the state to meet all the existing mandates, and can not cut expenditures in that area.
- Cities and counties thus claim they will have to cut from non-mandated areas: public safety and transit, primarily.

Most responsible actors point out that no city or county is going to cut public safety spending—but even that's not really true. Many smaller cities throughout the state already contract out public safety to the counties of which they are a part. Very likely more cities will begin doing this, and this could well result in less coverage (county sheriff's offices are not as well suited to community policing as city PDs). But not outright elimination of service as some local politicos have suggested.

In any event, the cities and counties are concerned about how they'll meet state mandates while still funding transit and public safety to the current level, at a reduced income. From a fairness perspective, it is inappropriate for the state to demand local governments spend a certain amount of money on state mandated programs with one hand, while limiting the local governments' ability to raise money through taxes with the other. The correct answer is to reduce the number and amount of state-mandated spending programs, and reduce the maximum tax rate at the same time. That's obviously not happening. Big shocker.

The governor, on the radio this morning, suggested that it was time for the people to vote on the plan—meaning we're going to have a special election sometime this year, I guess, at which we'll have two huge lobbying organizations duking it out over this issue for the next several months. Whee. The governor said it was good the people would choose.

I agree. But I want a better choice—right now our choice is between a half-assed vote-grab and no change at all. That's no choice. Here's what I want.

I want each property owner to choose whether to get the tax cut or not. And those of us who don't think this tax cut is well planned or a good idea can vote to keep our taxes at the same rate and subsidize our neighbors. And in return for subsidizing our neighbors, we get two votes at every election.

That's right. I want more votes. Maybe three. Depends on the size of the tax cut. If I'm footing more of the bill, I want more say.

Of course, taken to its logical conclusion this sounds like a great plan for the disenfranchisement of the poor. Surely nobody would let such a thing go on, right? Maybe we could force the politicians back to the drawing to come up with a decent plan in that case. At least, that's what I'd hope…

The problem is, the state legislature has presented us with two options, neither of which is good, but it lets them say they've taken on the property tax issue. That was really all they were concerned about: does it make them look good. They weren't concerned about whether the plan was actually any good or not, because it doesn't matter to them whether it's good as long as it looks like they did something and there's someone else they can blame if it doesn't work as intended.

Certainly it would have been much more difficult to examine municipal and county budgets and see where there is state-mandated spending that can be changed or eliminated. Instead of telling counties and cities exactly how they have to dispose of solid waste and sending inspectors out to make sure it's done according to code, the state could simply say that solid waste must be disposed of, and leave cities and counties to figure out the nuts and bolts themselves. Local governments are voted on, too, and if the people don't like the city council's solution they can demand change at that level.

But the state politicians are afraid of letting local politicians do anything, because then they might get credit for something good and run for state office themselves. It's much easier to tell them what to do and then take credit if anything good happens and lay blame if it all goes awry. That's the whole theory behind this tax-cut package. What a waste of time.

No comments: