THE PROBLEM with PROPERTY TAX HIKES

Saginaw County faces 4 different tax hike votes on August 7th. Three proposals are early renewals with new tax hikes, and one is an altogether new millage for increases to the 911 service costs we already pay for every month on our phone bills. Together these proposals authorize $80 million in property taxes [39,974,980 + 12,683,830 + 14,336,195 + 13,168,220 = $80,163,225 total taxes].

When considering these proposals, it is important to understand that if these proposals are defeated, none of these departments would lose any of their current funding, and services would continue at the status quo.  

In addition to these county wide tax hike proposals, the county has just started a new jail at an estimated cost of $38 million, without voter approval. This jail project has already had a $2 million cost overrun, before construction has even begun. When Detroit started a new jail a few years ago, they abandoned the project less than half way through when they projected $91 million in cost overruns, and now Detroit has a half-built eyesore sitting in a fenced field still costing taxpayers millions every year for nothing. The way the project is contracted, these disasters might be repeated in Saginaw, on your dime, despite the lessons of recent history in Detroit.

Further, 14 other millage proposals are on the August 7th ballot in one municipality or another all over Saginaw county. In November, county voters will likely face a millage proposal to generate $4.5 million annually for operations at the Saginaw Career Opportunity Center, and city voters likely face a proposal to repeal the voter enacted property Tax Cap [City leaders want to raise city property taxes from 7.5 mils to 10 mils, a 1/3 increase].

All this is in addition to other state and local property taxes that we already pay.

When you add it up, the figures are staggering, but to hear politicians and department leaders talk about it you would think the tax hikes are chump change – a few cups of coffee here or there. Today we live in a complicated society that is relatively wealthy compared to any other place and time in history. However, many property owners [and tenants] who ultimately pay property taxes have fallen on economic hard times.

Our political establishment is aggressive and does not like to say no to increasing the government footprint. It is easier for them to increase taxes and budgets than to make hard decisions and to prioritize essential services over other desirable, but optional services.

The argument for collective spending through higher taxes is economy of scale and fair distribution of common benefits. The argument forgets that taxpayers cannot afford to pay unlimited taxes for unlimited “benefits” that many do not see as affordable or even sensible. There are limits to everything, and the scope of government is no exception.

Those who question tax hikes are often maligned by elitists as anti-government and anti-tax naysayers. The fact is that people like Commissioner Kathy Dwan, who voted against placing these 4 early renewals on the ballot this August, are not naysayers at all – they are just not yes men.  Her punishment was to have Proposal 1 supporters attack her personally, and even post a photo of her home online.

When I recently posted a link to www.taxhikes.org, a taxpayer’s perspective website opposing these millage proposals, I got the following dramatic response from William Sharffe, a retired public school principal and city councilman who turned out to be on the Board of Directors at the Castle Museum: “Voting no? OK, eliminate 911 - good luck the next time you need police, fire, or ambulance service. Voting no? Good luck the next time you have a loose Pit Bull terrorizing your neighborhood or lose your own pet. Voting no? OK, take away much needed food, health, and recreation services for our County's seniors - who need such services the most. Voting no? OK, let the beautiful Castle Museum close and require Saginaw County to spend a million or more dollars to tear the damn place down! Voting no? You're a typical out of touch, uninformed, self-centered jerk. We really need more people like you - NOT!”

Many of today’s white-collar public professionals are authoritarian and prone to exaggeration and bullying, but everyday people just want the cost and scope of government to make sense. The problem is that many politicians, government employees, and government contractors have the time, motivation, and your money to amplify the voice of the party line on your dime.

They are incentivized by their paychecks and profits to spread the cost of their own wealthy lifestyles over the population at-large, and carelessly employ “kill the messenger” tactics to shout down those who object to public sector domination of the economy.

Contrary-wise, the average tax payor has neither the time nor the money to fight over tax hikes every day in the way the tax eaters can and do. One tax hike at a time, individuals find it is cheaper and less trouble just to pay the tax than spend money to fight it. This dynamic explains how government taxing and spending gradually increase over time, in small increments that can each be explained as minor and compared to a cup of coffee.

Luckily, this election season, the tax eaters have shown their cards, so that taxpayers can see the folly of government overreach and overspending. Seldom are so many tax hikes proposed all at once, so that the cumulative impact of the many incremental tax hikes on the total tax burden can be seen in advance for what they are - predatory. This year’s county-wide proposals alone could result in a 20% county funding property tax increase. That’s a lot of coffee, and more like a few paychecks.

Considering that many government endeavors turn out to be inefficient or corrupt, that makes it all the worse. The private sector did, and still could, provide many of the benefits that government monopolies have rendered unviable. Free market fee-for-service, private historical societies and charities are more accountable than government run programs and are voluntary. Why run a taxi service when the government runs buses that don’t serve many people but are too big to fail.?  Why have charities assist the elderly when the government is filling that need? What donors would make charitable contributions under these circumstances? Why invest in a dog kennel or a veterinary office when the government takes over that field by spending over $10 million building a new Dog Pound that offers socialized veterinarian services?

Government markets itself much like private businesses do, and its advertising campaigns try hard to convince you that you need what they are selling. But many people don’t need or want what they are selling, and not at those prices. That does not make individuals greedy or cheap – just discerning.

Proposal 18-1 is a tax hike plus early renewal tax, too.  Current funding will not be impacted by a no vote. Animal Control currently receives $705,442 each year. The director is proposing to build a NEW FACILITY costing $11.4 MILLION, plus Obamacare for pets. If approved, the total dollars annually could be $1,998,749.00 for TWENTY YEARS. $1,998,749/year X 20 years = $39,974,980 total tax (The proposed annual Increase is an additional $1,293,307) This represents an annual increase of $1,2933,307 in addition to the annual current millage of $705,442.  

Proposal 18-2 Castle Museum Millage increase proposal is a tax hike plus early renewal tax, too. Current funding would not be impacted by a no vote. The museum currently receives $939,177.00 annually from the county.  If the increase passes it is estimated to generate $1,268,383.00 annually for TEN YEARS.     $1,268,383/year x 10 years = $12,683,830 total tax. In 2015 the museum drew 24,177 visitors, in 2016 the figure dropped to 22,060, and last year it was down to 18,746 visitors.  Cost Per Visit: $68 This proposal represents an annual increase of $329,205 in addition to the annual current millage of $939,177.

Proposal 18-3 County Commission on Aging proposes a tax hike plus early renewal tax too. Current funding would not be impacted by a no vote. Commission on Aging currently receives $2,022,263.00 annually from County taxes (total annual budget exceeds $4 million with state federal grants). If the increase passes it is estimated to generate $2,867,239.00 annually for FIVE YEARS. $2,867,239/year x 5 years = $14,336,195 total tax. This represents an increase of $844,976 annual tax increase to the current millage of $2,022,263.

Proposal 18-4 911 millage proposal is in addition to current per-phone surcharge which supports 911 service. It is an all NEW millage of 0.28 mils estimated to raise $1,316,822.00 per year for TEN YEARS.                $1,316,822/yr x 10 years =  $13,168,220 total tax.   911 NOTE:  we currently pay a surcharge on every phone (cell & landline) of $2.65/month collected by phone companies who return the money to the county with no audits or explanation of what they collect.  NO TRANSPARENCY! Our 911 Authority currently receives from phone companies $6 million/year to operate.  If this passes they will get a total of $7.3 Million for TEN YEARS. This represents an increase of $1,316,822 annual tax hike!

Promoters claim this money is need for new equipment, but then admits only 68% of the new money would actually go to equipment.

So don’t be afraid to push back by voting no on August 7th.  Calculate your tax burden by multiplying the number of proposed mils times your taxable value (on your tax bill) and divide by 1,000. A no vote will save you money, and it won’t even reduce the budgets for any of the government departments involved. It will only stop the unfettered growth of government and the tax burden on citizens.