Friday, September 14, 2007

Gage Froerer's Property Tax Relief Options with Minor Machman Comments

1. Target property tax relief for the elderly and/or poor.
a. Status: Bill is written and will be in form similar to HB078.

I don't feel warm and fuzzy about targeting a specific group for special benefits at the expense of all others. It has caused "seniors" to be resented in other States for example. They/we need love and patience not resentment due to "special treatment" by legislators. A more comprehensive and all encompassing tax reform is called for. Remember last night (12 Sept.)? Few indicated they liked it but could not seem to nail down exactly why on the spur of the moment. It smacks of trying to buy off the AARP crowd who are loyal voters to be sure, but it has a certain stench to it... We need more information on this. What would Ronald Reagan do? Would a conservative go for such liberal and classic Democratic special interest group bailout? Somehow I think not.

2. Increase limits on the circuit breaker to allow more people to qualify for relief.a. Status: Bill file is open and will be presented in 2008 session for approval.

Again, this seems disingenuous and simply a Band Aid on a symptom. The "disease" is the current market valuations which have been predictably abused all over the State and particularly here in Ogden Valley. Circuit Breakers (again) are, at least I believe, poorly thought out stop gap measures. And they require yearly increases and are frequently abused by families who have for example younger wage earners living in the same household and contributing. Such laws are frequently the source of neighbor versus neighbor squabbles and a source of disrespect. And when the clear light of day shines on the legislation it is eventually dropped as yet another bad liberal idea. We are supposed to be a conservative, red-meat, Republican State..the most conservative one in the United States. Let's act like it. Dump these liberal payola schemes for special interests. Let's have some true legislative reform of property taxes which spans every segment of society - old and young, rich and poor.

3. Allow the State sponsored 45% residential exemption to be applied on land and improvements for primary residents regardless of lot size. Presently it is capped at 1 acre lot size.
a. Status: Bill file is open and will be presented to committee in October 2007 and presented in the 2008 legislature for approval.

That is great for those of us who live in the Ogden Valley and were "trapped" by the General Plan or Master Plan requiring a three acre plot. And the legislation for this unique and again "special" interest group is well over due. I would say rather than continue this nonsense, pass legislation requiring County and/or State Government to repay and/or credit such landowners on their tax notices. Just like when a utility screws up and has to credit accounts. The County and State Legislature share responsibility for this debacle and should jointly repay three-acre landowners. Then institute real property tax reform legislation and I don't give a darn whether it takes an act of the US Congress or the Treaty of Versailles to enact. Point is and operative word is "ACT".

4. Eliminate or reduce the maximum authorized property tax levies. Counties, school districts, municipalities and special districts are all authorized to impose a wide variety of property tax levies for various purposes.
a. Status: Levies are currently being looked at by State Revenue Tax committee to see if any could be reduced or eliminated. Some may be required to charge fee.

School vouchers are having an unintended effect as we agree. They are placing responsibility for the education of our children and grandchildren with the parents and taking that traditionally assumed authority away from the UEA Union. School Districts seem to be proceeding with budgeting and taxing as if there has been no change and there is no tomorrow...redistricting and building and adding and remodeling and building. They seem to be "betting on the come" that most parents will fold like a cheap tent under the weight of the second most powerful lobby in Salt Lake City...The UEA (Union). Only time will tell but unfortunately we are in fact being taxed out of our socks by this bottomless pit and perennial whining organization.

One pass by the UEA Union building in SLC will say it all. The building covers an entire city block and could only possibly house "mahogany carpeted offices" for highly paid prior legislators and lobbyists for the UEA Union. A simple lease on about five offices should do it. Then use the money saved by selling the UEA's building to pay for more and more and more teacher raises and salaries and retirement benefits. School Districts are as out of touch and control as our local governments are. They all need reigning in by serious property tax reform which will force some belt tightening at every level. And something as simple as the Weber Basin Water Conservancy District raising taxes (mine went up by 170% and I don't even use their stinking water) just because... just because it has been awhile since they last raised them. Did any one explain what the 100% plus increase in property valuations would bring them without raising their tax rate? Can you or anyone else spell "Windfall"? Point is this whole mess from Mosquito Abatement Districts, Assess & Collections (how about that folks we are paying $75 for these disparate assessments), 911 and EM service District, to you name it are disjointed, uncoordinated, inefficient and grossly out of control. I was watching my grandson play football and as bad luck would have it a kid got hit in the back by a helmet. Who showed up? You got it - three huge firetrucks and a paramedic ambulance. Anyone ever question why the fire trucks? Very curious. We all know now we need to apparently do something about "it". We elected you and your colleagues and expect action...remember "act". Not just talk.

5. Roll back certified tax rates. Require that all taxing entities “roll back” property tax levies they now impose by some amount. For example, amend truth in taxation to provide that a “certified rate” (a rate that does not trigger truth in taxation hearings) is a rate that will yield 90% of the property tax revenue that the entity budgeted or collected last year.

Tax rate or CTR rollbacks sound good. Would make a nice sound bite, but look at what we are experiencing. They gave us a 3% "rollback" and just increased our assessments by 60% in 2006. They "gave" us a 13% tax rate decrease or "rollback", but then just increased our assessments by well over 100%. This is a bait and switch scheme and too easily manipulated by local governmental taxing agencies and used car salesmen posing as assessors. And if we wanted any tinkering with "Truth in Taxation" it should be in the reverse. Instead of amending TNT so that a rate does not trigger TNT hearings, we should be going entirely in the opposite direction. Amending TNT so it is "Truth in Taxation on steroids". ( I credit Ron Mortensen with that phrase.) We should be plugging the many holes the legislature has already shot through TNT until it virtually is the toothless dog it now is. No Gage, although this is an innovative approach it won't hold water. We are simple folks who want simple, clear, inviolate, fair. equitable and reasonable property tax reform. An analogy would be; remember when in years past we were constantly in turmoil over vehicle property taxes. They were so off the page with most residents we frequently ran around with bills of sale and affidavits saying we only paid $100 for that slightly used car or truck. It turned us into liars and guilt ridden tax cheats. Until finally - finally someone bright came along and now we are reasonably happy. We only pay up front with the sales tax and then it goes a while at $150 and drops to about $36. Who ever that was who figured it out? Go find him/her and let's see what he or she can come up with... Seriously Gage, some of the legislation is so convoluted and gobbly-gooked up it is impossible to understand without benefit of many hours of listening to debates and information in camera. Read Senate Bill 36 or 221 for seems to be just another dodge from Truth in Taxation for School Districts. What did Reagan do? He insisted on plain English bills and laws. Are we or are we not Republican? Remember who we are supposed to be and act like it. No sheep in Wolves's clothing. Let's clean this mess up. Let us have an"acquisition value" system of taxation rather than the more commonplace "current market value taxation" fraught with all the hyped up and souped up MLS and exaggerated and highly speculative guesswork that goes into guessing what our property "might be worth" on the open market. And frequently improperly assumed property amenities and features by temporary hire, part time off the street and untrained "assessors" and their gold tanned bosses. We have seen enough of that act Statewide thank you very much. Let's get rid of the whole lot.

6. Require and increase in the certified tax rate to be approved by the electorate.
a. Status: The legislature has imposed similar requirements in previous tax years.

Although it has been used in the past by legislative intervention, it seems not likely without intensive open public meetings during which much is disclosed about budgets and needs versus nice to haves, etc. The way this culture seems to gravitate to "Never tell them what they don't need to know. Or my ____ will tell me what I need to vote for or what I need to know."
What I am saying is... in this Valley most people do not know really what they want. They do know exactly what they don't want. And they don't want "incrementalism" from small continuous increases on just about everything imaginable. They don't want any more of this male bovine excrement from the assessors office and the finger pointing. They have had it with "current Market value" taxation systems. The people up here, and I suspect all over this State, are tired of schemes and convoluted complicated knee jerk legislation not in the best interests of all the people, which legislators have sworn a Holy oath to uphold. They do not want lobbyists of any stripe influencing your decisions no matter how subtle. They do not want you to accept any free tickets to Jazz games, meals, or anything else from anyone...period. They want all their elected representatives to behave in public toilets and in their personal lives. And most of all they want to be very proud of those they have elected to represent them because they do represent them. And not some special interest group or groups. You need not take umbrage with this statement because I am not accusing you of anything Gage. I am only saying what I feel most people want and do not want.

7. Remove property tax authority to schools or other taxing districts and replace it with a like amount on a statewide sales tax. School districts collected about $1.078 billion in property tax revenue in 2006. Would require an increase in sales and use tax by about 2.5%.

Good but think more broadly. Consider other sources only fairly lightly tapped, relatively speaking of course. Augment sales tax increase (2.5%) downward with offsets like; impact fees, new growth revenue especially where increased children are introduced into the school district - almost like a modified head tax, luxury taxes on adult toys like wave runners, ATVs, snow mobiles, sail boats and power boats, leave fishing boats alone as they are "crop productive tools", think more broadly. Me, I wade and fly fish.

Definitely take taxing authority away from school districts. They and their Union are as out of control as local governments. Force them into the room with all other taxing agencies where only a few sandwiches are tossed into during budgeting week...more on that later

8. Freeze the property tax and/or assessments and not have it increase until the property transfers ownership. A constitutional amendment is required to implement this change. Requires 2/3 vote of both chambers and a vote by the electorate.

Remember you said, "Anyone who does not support this please raise your hand." and not a single hand was raised. This is "Acquisition value" based taxation reform in a nutshell. But do not forget the provision which allows transfer of property within a family which carries with it the same tax benefits. This is an important step in solidifying communities and enabling them to evolve and develop unobstructed by State, county or city government. Please keep in mind that for at least some of us who believe in the American dream, our home is our castle and as such it is not simply in effect "rented" from the County or the State via oppressive taxation policy.

9. Link tax cuts and/or increase to the median value of all homes in a given county. Require counties to use the median value across the board for any increase in assessed value. A constitutional amendment would also be required since this would change the Fair Market Value portion of state law.

Not sure, but I think some other State(s) might have adopted this type legislation. If not why throw out the decades of accumulated economic statistical data and legislative lessons learned? Instead why not commission a formal "egg head" study group to look into what Montana, Washington, Oregon, South Carolina, Massachusetts, California, Michigan, Indiana, Arizona, Florida, Iowa, New York and Oklahoma did, plus any others more recently. Why not get out in front of this thing and let's talk about it 17 September in the Legislature's Revenue and Taxation Interim Committee Meeting? Why not be proactive and let us all know this is serious and not just more male bovine excrement or a feign in our direction? That is what I would do. The education process will take time and time is wasting. We want "acquisition value property tax reform" and we want it this session without bureaucratic delays, foot dragging, and nonsense.

10. Mandate that all counties reappraise on an annual county wide basis. This would help eliminate the large spikes or discrepancies in value in different parts of the county.

NO! No more. We have had a gut full of this antique and bogus "current value market analysis" assessment crap. We have been given a cram course and an education thanks ironically to an inept assessment administrator and staff. We do not want any more of what that element would like to sell. No thank you sir. Current market valuations are an oxymoron...there is nothing about them that is "current" nor remotely resembles "market value". Plainly speaking it is a speculative, self inflationary, real estate market driven system, perpetual motion machine which has "Market Valued" and taxed our youth out of the State, as well as our seniors. It is a system which has been trashed by legislators, marketing, real estate, and developers. It must stop and stop now. Unfortunately for many it is already too late and the shame rests squarely on an otherwise honorable profession chocked full of very good and honest people.
People like the ones who have worked until two AM every day for weeks to try to help clean up the mess across this Valley made by the Weber County assessor and staff, and most other Counties as well, based upon the news reports. No sir, no more. No more piling on of incompetence on top on incompetence. And I even think the Realtors would agree with me on that.

11. Petition our Federal Officials to more actively pursue “The Apple Initiative”. Would require payment from the Feds on the Federal owned land in the state that is un-taxable.

Lord yes! I can only ask why on earth have the State Congressmen not had that at the very top of their legislative agenda every year? Why on earth have we let old Orin hang around for what 18 years almost now, if not to get this legislation passed. What does he do for a living beside write love songs. There is a secret every fighter pilot eventually learns about dog fighting (the aerial kind not the Vick type). When you are one versus one in a stalemated chess match which ultimately ends in a move - counter move death spiral, you need to do the unexpected. Do something - before you run out of airspeed, altitude, and ideas. But not something stupid that will get you killed. Change the dynamic. Perhaps we should toss ole Orin out on his musical ear and trade him in for a Democrat. That's right a flaming Democrat since most "Republicans" in this State act more like classic liberal Democrats than conservative Republicans. Just a thought.

Additional related legislative options - just a few off the top of my head:

(1) Begin by putting every agency on the same schedule. Either go on a calendar year, a "State fiscal year", or the Federal fiscal year.

(2) Legislate law requiring all revenue producing sources must be consolidated by a specific date. That includes fees, licenses, new growth revenue, property taxes, income taxes, everything gathered into the treasuries before any budgeting process can begin. This is simple and should be easy to understand. If we are to have any control what-so-ever over spending or budgeting, you must first know what is there and available to be budgeted and thus spent. Not the other way around.

(3) Pass legislation requiring all taxing agencies within a County literally come together in a single location and room (auditorium) and formulate their budgets together and in cooperation with one another. Include School Districts, Water Conservancy Districts, Fire Protection, 911 EM Response, Health, and all those separate taxing agencies which fill our tax notifications. Do not let them out until they can come to an agreement which has the force of law. No maneuvering, no slithering around, but complete fiscal responsibility and accountability. Toss in a few cheap sandwiches or box lunches until they finish. No fancy or expensive luncheons at taxpayer expense or paid for by lobbyists.

(4) Combine these taxing agencies where it makes sense to do so. There are simply too many which creates inefficiency.

(5) Legislate taxing agencies have to make available in the public domain including news and Internet all budgets and revenue sources. This will encourage accountability and more fiscal fidelity and improved management.

(6) Legislate that all bond issues must be voted on during a part of the season (unlike June or August) when only about 60 votes can commit an entire County to a multi million dollar long term bond debt.

(7) And for goodness sakes fix the perverted and backwards tax legislation which has Towns and Cities paying a higher tax rate than the unincorporated areas which surround them. They are without question being doubly-taxed under the present tax system. Call it the Huntsville Amendment. Comptrollers and auditors know it and you all should know it. So change the law so it makes common sense.

(8) Use "acquisition value" based logic. Form a Flat Rate Property Tax table which uses a sliding scale of property taxes. Think in terms of the success the DMV has had with a much simplier, fairer and predictable tax system. Eliminate tax assessors and their expense to the public and the whole real estate driven inflationary and unfair controversial tax scheme.

(9) Require assessors (if that concept has to continue) be audited by outside auditors. Did I not read in one of your missives that only Weber and Salt Lake County have elected to do their own audits? Please say I ain't so! This is about as basic and simple as management gets. You never allow the goats to choose between a pasture and a garden. You never ask Dracula to guard the blood bank. So why would you allow the Weber (or SLC) to audit their own work? Little wonder why we are seeing such resistance to appeals and flat out lies about how accurate their assessor's work has been? Unless I am somehow mistaken and an independent auditing service not in anyway connected to Weber County Government is actually being used, this is simply blatant malfeasance on someone's office. And this might well be the source of our collective misery and anguish...lack of adequate quality controls and improper auditing procedure of disparate assessments. In any event make sure if it is a problem it can never happen again.

(10) Demand from our US Congressional representation that they work to have Utah's lands restored. After the "massacre" Utah was partitoned into one kilometer squares forming a checkerboard of Federally owned, versus other than Federally owned, properties. This was clearly done because the Feds. (read the rest of the Country back in 1860's) did not trust and therefore wanted to control Utah territory (the Mormons) basically. The time has come when privately owned lands are so scarce that demand is out striping supply. Prices are completely beyond reason such that "starter homes" for less than $300,000 are almost impossible. Wage increases have lagged, again forcing hardships on families and those would would like to begin families of their own. Clearly this must change. And after one-hundred and fifty years or more the mood and trust of the Country has changed. Hell, I am from Arkansas and I have no anamousity toward Utah or its culture, nor distrust of its government. To survive as other than a non primary resident State we must get the US Congress to "vacate" federal land claims and thus open up areas for reasonally priced housing for our youth.

I would be willing to work with anyone, any time, and at any place to help accomplish these proposed solutions to disparate and endlessly increased taxation. "When you are through changing you are through."

Minor machman
"Wingmen for Property Tax Reform"

Please review and email me your thoughts on any of the above options. Feel free to add additional options that you would like the State to consider.Thanks,Gage

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