Saturday, November 29, 2008

HamCo's Budget Woes

By now, we all know the story: the County faces a $31 million shortfall in 2009. The Board of Commissioners has determined, apparently, that the only way to fix this is to cut spending. But that seems to be looking at problem from only one of two possible angles. Why aren't we having a discussion about increasing revenue?

There are two ways to generate a significant amount of revenue for the County's general fund. First, the Board could raise the sales tax. Popular? No, of course not. But perhaps better than laying off hundreds of our neighbors. Second, the board could eliminate the "property tax rebate."

What is the property tax rebate? It's a commitment made to voters in 1996 that if a sales tax increase to build the new stadia were approved, 30% of the funds from the increase would be returned in the form of a property tax rebate. Commissioner Pepper has made it clear that we're not allowed even to discuss the rollback of the rebate. But other than to point out that the promise was made, he doesn't really say why. Presently, we redistribute about $19 million in sales tax revenue to property owners.

Let's look at the promise. It was made over 12 years ago. Bill Clinton was President. The economy was great. Local governments had tons of money to spend. No one on the Board then remains on the Board now (in fact, at least one was voted off because of the stadium deal). Many residents of HamCo now weren't residents then (like me). Many who were residents then have moved away. How long does a promise (one that was not written into the referendum and with no legal backing behind it) bind a county? All the way to fiscal insolvency?

We are no longer in a position to redistribute wealth through the "property tax rebate." It's time to seriously think through these issues, even if the solutions are politically unpopular in the short term.

What's the right answer?
  • A. Slash $31 million from the budget, closing Queensgate (leaving the Sheriff, rather than our judges, to decide which accused individuals remain in jail pending trial) and laying off hundreds of our friends, relatives, and neighbors?
  • B. Raise the sales tax rate?
  • C. Roll back the property tax rebate?
  • D. Secede from the Union. Start printing money like it's Mardi Gras!
I'm curious as to whether I'm the only person who thinks it's insane for our local leaders to bind themselves to a commitment made nearly a decade-and-a-half ago.

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