Enlightening self-interest?
Democracy works best, thought the Greeks, when it was direct, the polis assembling in one place and openly debating their choices. But it is there, in the crucible of local debate, that the policies of public interest and the politics of private interest most sharply clash. In housing we see this in the clashes surrounding local property taxes, and nowhere is this more contentious than my state of Massachusetts, where a statewide referendum (Proposition 2½) capped real estate taxes at 2½% of market value … unless the community votes to increase them by an override.
“Where you stand on an issue,” Karl Marx is said to have commented, “depends upon where you sit.”
“And if the people owned everything, there would be no taxes … because there would be no income!”
Override battles are among the most brazenly self-interested, as the Boston Globe highlights in the town of Wrentham’s current tussle:
WRENTHAM — Spring brought blooms of yard signs to the broad lawns of Wrentham, where a vote Monday on raising property taxes is dividing the town. On one block were signs of revolt — ”No $1,100,000 tax override” — while signs in nearby yards scattered with small bikes and toys urged their neighbors to vote yes.
Voters have very personal opinions about whether the tradeoff is worth it to them.
Mary Ann Nardone, outside her home, explained why she favors the override. Nardone and a friend paid for lawn signs urging their neighbors to vote yes.
Property taxes pay for local services, of which the most visible (and often, most expensive) are the public schools:
”I’m not as worried about my tax bill as I am about the class sizes going higher than they are,” said Kelly Foxx, a mother of three who supports the override.
As former House Speaker Sam Rayburn was fond of saying, in politics, it all depends on whose ox is being gored.
So smart they named an expensive Federal Congressional building after him.
The ultimate in incumbency, a building and a permanent statue in it!
and in this case, it’s about how many children you have:
”People that got kids in the school want the override and those that don’t, don’t,” said Richard Campbell, 56, who lives along a row of modest homes tucked into the woods off Wrentham’s Creek Street. ”We get all these people making all this kind of money and they want everything they want, and they want everybody to pay for it.”
Richard Campbell (above) talked outside his home yesterday about his reasons for opposing the tax override in Wrentham.
Local taxation makes the relationship between services and payments very personal:
The tax override would add about $264 to the average single family tax bill of $4,579 [a 5.75% increase — Ed.], based on data from the state Department of Revenue’s Division of Local Services.
”The need for overrides is greater than ever in order just to protect the existing level of services,” said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation.
Those who seek to raise taxation often find it effective to ring-fence a portion of the proceeds for a worthy cause with broad appeal:
On the same ballot, voters will decide whether to add another 2% on their property bills [Or $91.50 apiece, or about $375,000 for the whole town — Ed.] to protect land under the Community Preservation Act.
Paying directly (via override) is so much more visible than the arcana of assessment, and because people value only what they pay for, a cap on local taxes provides an important check on local spending by focusing scrutiny on the budget:
”I don’t think anyone wants to pay more taxes,” Jack Unger, 43, who has two children in the schools, said as his son ate ice cream at Tootsie’s Ice Cream in the town center. However, he added, ”If there’s no other options and that’s been looked at, you don’t have much choice.”
Have the options been considered?
Other town residents think they are being dealt a false choice and blame local officials for poor financial planning.
Wrenthamites are divided:
Chip Faulkner — associate director of the statewide antitax group, Citizens for Limited Taxation (”Every tax is a pay cut — a tax cut is a pay raise”), and a Wrentham resident — said he believes the argument voiced by Romney’s former budget chief, Eric Kriss, that municipalities have still not learned to live within their means.
State to localities: “Cut back!”
What consumed revenues from happier past times?
Many of the overrides have been proposed not for glitzy new construction projects, but simply to pay the bills.
On Monday’s ballot, Wrentham officials will ask voters to boost real estate and personal property taxes by an additional $1.1 million to pay for routine municipal services.
‘Routine municipal services’ doesn’t sound good, so tax increase initiatives are often presented as not maintenance but improvement:
In Millis, where voters last year defeated a small, $142,000 override to restore jobs in the Police Department and in public works, officials are trying again, pitching a $1.1 million override to help fund the schools, public safety, the library, and health and human services.
Who could possibly be against schools, libraries, public safety?
”Because they can’t control the runaway spending, they’re asking us for a tax hike,” Faulkner said. ”That’s ridiculous. Keep your budget under control.”
Angry Wrentham taxpayers point to a flurry of construction projects that the town launched in recent years: a major renovation of Town Hall, two new schools and a high school addition, and a new public safety building that one selectman described as lavish.
”We have got the best of everything, and we can’t afford the best of everything,” said John Zizza, one of two selectmen who voted against putting the tax override before voters and who urges greater fiscal restraint. ”I have a saying I’ve been using for years here: The best services in the world are meaningless if you can’t afford to live here anymore. But there are people who don’t care.”
Mr. Zizza’s causality is logical but the demographic dynamics are even more complex than that. Good schools make towns more attractive, so they drive up property values; in turn, these add money to the town’s coffers and supports more services. Meanwhile, driving up values erodes affordability and contributes to a town’s gentrification, as those who move in are more affluent than those who move out.
When in doubt, pass the buck up the food chain, so the town is hoping to avoid resolving its dilemma by having the state resolve it for them:
With another season of tax overrides in cities and towns, anxieties over property taxes are front and center in this year’s race for governor, as candidates tap into voters’ worries about rising taxes and high expectations for schools, police and fire service, and public works projects.
Already, candidates for governor are debating the merits of cutting the state income tax rate or using replenished state revenues to return more aid to local government, so they can offer homeowners some property tax relief. The towns say that they are starved for cash because of aid cutbacks by
In this game of budgetary Old Maid, even as cities and towns are trying to pass the buck up,
Don’t get stuck with Elsa Lanchester!
Observe, children, the electoral value of political vaporware: promising future tax cuts Tuesday gives political capital today.
… by lifting the cap on the state lottery, a proposal echoed last week by House Speaker Salvatore F. DiMasi.
“I don’t want it, you take it.”
An improving state budget picture may mean money for cities and towns in the future, but for now some cities and towns — Wrentham, Millis, and
The state has been quietly passing it down:
Driven by reduced state aid and skyrocketing healthcare costs for municipal employees, the number of tax cap override efforts nearly tripled between 2000 and last year. There were 164 override attempts last year, almost half the state’s cities and towns, but only 87 succeeded. The total this year has not yet been compiled by the state.
Over-rides are local, and each battle is individual.
Here then is the policy-politics lesson. The law of economic gravity tells us that, when half the state’s localities are pressing for an override, it’s an indication of systemic mis-calibration.
(Indeed, the tax burdens can be so mis-calibrated as to kill municipal reinvestment. The extreme case of local-auto-strangulation is California’s 1978 Proposition 13, quite possibly the worst citizen referendum of the last half-century, and one about which I will post sometime.)
The outbreak of override attempts is good evidence that Proposition 2½ binds too tightly: the voters want a service menu they cannot afford, so they bang heads.
“Good schools!” “Lower taxes!”
Head-banging is painful but healthy, as it is essential to informed governance.
In Wrentham, a town of about 11,000 people that is home to the sprawling Wrentham Village Premium Outlets, the debate in the shops and front yards is about the value of town services and the cost to home finances.
The voters brought this on themselves; the voters themselves must weigh the balance.
Town meeting, a
“Democracy is the worst form of government … except for all the others that have been tried.”
– Winston Churchill
“V for voting!”
