Why tax property, particularly private residences? The answer is simple: to protect property.
Unlike sales or income taxes, property tax revenue is stable and predictable. Local governments across the nation traditionally have relied upon property taxes to fund the core operations of government, especially police and fire. Excessive reliance upon sales-tax receipts can lead to plummeting revenue, forcing cities to trim police and fire funding, and potentially putting citizens at risk.
Has that happened in Colorado Springs?
For those of us who are at least part-time residents of the reality-based community, a brief history lesson might be appropriate.
In 1991, Colorado Springs voters approved two Douglas Bruce-authored amendments to the City Charter. One phased out a half-cent capital improvements tax that had been enacted by City Council a few years before, while the other was the first iteration of the Taxpayer’s Bill of Rights.
This mini-TABOR reduced the city’s mill levy to 7.00 mills, and further restricted annual property tax revenue growth to the percentage change in the Denver-Boulder consumer price index plus “local growth” for the previous year. That amendment, buttressed by the statewide TABOR amendment to the Colorado Constitution, is still in full force and effect.
Its formula may seem sensible, even innocuous, but there’s a kicker: City officials may be required by its mandates to lower the mill levy, but they have no power to raise it. That’s the infamous TABOR ratchet.
Result: the city’s mill levy, fixed at 11 mills in 1990, has dropped to 4.1 mills, thanks to four charter-mandated reductions.
City property-tax collections actually have dropped in the past 22 years, from $19.6 million in 1990 to $19.15 million in 2012.
By enacting the public-safety sales tax in 2000, followed by the 2004 regional sales tax that funds the Pikes Peak Rural Transportation Authority, voters supplemented stagnant property tax revenues with new sales taxes.
That didn’t work when the recession hit. City finances so deteriorated that City Council was forced to trim public-safety funding, as well as virtually eliminate the parks department and turn off streetlights.
Did cutting police and fire affect the city’s response to the Great Fire of 2012? That question is unanswerable, since it depends on so many what-ifs.
Conservatives probably would say that the city would have frittered away any additional property tax revenues in padded payrolls, overly generous pension plans, and wasteful, unnecessary spending.
Moderates might note that the cautious centrists who have dominated City Councils past and present have always made public-safety funding their highest priority. If the money had been there, those cuts would never have occurred.
Fire Chief Rich Brown, dismissing the suggestion that a larger fire department might have been better able to fight the fire, says that “you can’t staff for ‘surge’ events.”
There’s some truth in that, but there’s another way to ask the same question.
What is the appropriate force level for the CSFD? 420 firefighters? 500? 600?
I don’t know. I’d just as soon leave those decisions to Chief Brown, to Mayor Steve Bach, to economic vitality director (and former Fire Chief) Steve Cox, and to the nine thoughtful people we elected to City Council.
But I can’t, because 22 years ago a scant majority of Springs voters listened to Mr. Bruce’s persuasive siren song. His success in Colorado Springs helped push the statewide amendment past a Colorado electorate that had twice rejected it in the past.
TABOR put government on autopilot, transforming elected officials into irrelevant spectators. Abstract formulas determine city revenue, leaving officials to cope as best they can with changing circumstances.
We’re all the Dougster’s bitches now. We may suspect that local government is permanently crippled, but we love our low property taxes. And since we can kill any attempt to rebalance property and sales tax, we do it — bless our selfish little hearts!
We still believe in the Gospel of Saint Doug the Convicted. Government: bad! Politicians: greedy and self-serving! Voters: pure-hearted and righteous, except for liberals!
I’m no better than anyone else. I love to remind my vastly talented brother-in-law that he pays more than $10,000 in property tax for his house in New Jersey while we pay $1,600 for our place on the Westside.
But perhaps I should be ashamed, not proud. Could our taxophobic ways be the problem, not the solution?
We have met the enemy, and he is us — Pogo Possum.