April 27. 2010 - Issue of the Week

Really Protecting People's Wallets, or Playing Politics?

On Tuesday the County Council will hold two public hearings on proposals being brought forward by five members of the Council (wonder how that vote will turn out?) to limit tax increases in the General Fund, Road Fund, Conservation Futures Fund and Flood Control Fund to 1% each year, including banked capacity, unless a non-binding vote of the people is held.

State law already limits tax increases to 1% without a vote, but this takes that one step further by also limiting the amount of banked capacity the County can tap into. Banked capacity is the amount of untaken increases (the 1% possible each year) that a local government has not taken. State law allows fiscally conservative governments that hold the line on tax increases to bank, or save up, these untaken small increases in case they are needed in the future. Most local government entities (Bellingham, the small cities, school and fire districts, etc) take their 1% each year so they have no banked capacity to draw on, but the County has been extremely conservative in its spending and now the Council majority wants to make sure we can't tap those reserves without asking the people if they approve.

Supporting such “voter oversight” is extremely politically popular (which is why this is being brought forward), and it also gets elected officials off the hook for having to make tough decisions. But this version is again poorly written so it conflicts with the Charter, provides precious little real fiscal protection, and more importantly is being brought forward by a group that has every intention of slipping a huge tax burden into all of our pockets with one hand with no recognition of the future financial problem they are creating. I am not sure how I am going to vote on this on Tuesday because on the one hand I have no problem with voters having more involvement in their government, but on the other hand I wish they were being given a real say instead of a Fox News type slogan to vote on with little real meaning.

A few problems

First off, the County Charter (Section 6.10) does not require the Executive to provide a budget to the Council for consideration until the middle of October, and that is the schedule that has been historically followed. Under this proposal to limit taxes the Council would have to decide by July 1st of each year whether to ask the voters to approve a tax increase. How is the Council supposed to do that if they don't have a clue about the proposed budget until several months later? It also conflicts with Charter Section 6.20, which doesn't require departments to provide budget information to the Executive until mid-August. There is no mention of a plan to change the Charter, or ask the Executive to move the budget process up several months. Perhaps they just plan to put a tax increase on the ballot every year just in case once they see the budget it is needed? Beats me how this is supposed to work, or perhaps it is another one of those proposals that isn't really planned to work at all.

There really is little taxpayer protection here either since it is a non-binding vote that can be ignored. The other reality is that this, or any future Council, can change these rules to do away with this vote any time they want. I also believe that the voters have elected people they want to spend the time to study such issues and then make the hard decisions necessary regarding taxes and spending, and not punt the tough decisions to the voters each year to avoid political fallout. In many ways this represents a cowardly approach to governing.

The tax increase levels that would trigger such votes are very small, and the potential increases are not very great. For instance, the current levy rate for the Flood Fund is $0.16299/$1000 of assessed value. This means that an owner of a $250,000 home pays $40.75 each year. Under this proposal if the council decided (like they did a couple years ago) that more money was needed to make up for past flood expenses, do work to protect public and private property from clear potential future flood damage, meet state and federal requirements for protection of Lake Whatcom, salmon, etc, the Council would have to spend taxpayer money on an election to ask permission to use our saved reserve capacity to raise the rate more than 1% or 41 cents per year for the owner of the $250,000 house. While a whopping 41 cent tax increase or a really HUGE 10% $4/year tax increase may seem important to many people, how many of these same people (including these same Council members) have spent the time to know how the money is actually being spent.

If the Council decided to increase every possible cent of tax in every fund that they legally could, a possibility that I don't think anyone who knows much about County government thinks is even remotely possible, it would cost about $7/month for that $250,000 property owner. Just saying ”no” is a whole lot easier than knowing what you are talking about.

Finally many of the same Council members who are pushing this feel good initiative are also pushing for a huge expansion of urban growth throughout the County. They are doing this with no plans to ask the developers of all this growth to pay the associated costs. So the taxpayers will have to foot the bill for increased sheriff protection, new roads and all the other government services that are more expensive to provide in rural areas than in cities. If these council members were really so concerned about the taxpayers pocketbook perhaps they should try to look out for the taxpayers in these development schemes instead of just trying to help out a few wealthy developers. Where are the associated impact fees to protect the taxpayers? Where are the transfers of development rights for this growth to protect the taxpayers along with helping protect farmland or Lake Whatcom? Either they plan to be going to the voters a lot in the coming years, or they plan to allow existing levels of all kinds of service to be undermined in their rush to please a few developers.

Watch carefully Tuesday, anyone that votes in favor of these proposals, while at the same time supports these outrageous growth proposals, is a political opportunist not a true fiscal conservative.

Perhaps we should have a baby kissing, flag waving, apple pie eating event immediately after the vote?