Entries Tagged 'Taxes' ↓

Busted! City’s intermingling of CIP and Enterprise fund money

Remember only a few short months ago before the city election when the Public Works department and Mayor’s office were in maximum B.S. mode? I know, hard to keep track.

We were essentially told that water rates had to increase because they were a separate ‘enterprise fund’ and the fees you pay towards water and sewer went directly towards fixing water and sewer. They also told us in that same breath that ‘they could’ use CIP money (2nd penny) for upgrades to water and sewer, but didn’t because of the enterprise fund.

Now comes along Item #55 in the Sioux Falls City council agenda for Tuesday night (click on item then click on the PDF in the upper right corner). Seems the Water department and the Streets department are having a regular old poker game with our money, and chips are going all over the place. So how is it we can give road money to the Water department and Water money to the roads? I thought they came out of separate funds?

Once again more hyperbole fed to us before an election. At least we didn’t end up with another $180 million dollar white elephant this time.

Seems the ‘abuse’ of TIF’s is all over the place (H/T – Kolache)

This is a letter to the editor over a year ago in the Lincoln, NE newspaper oddly similar to what we are experiencing in Sioux Falls, especially when it comes to TIF’s and the city’s power to hand them out like candy;

In enacting TIF, the Legislature made a vital mistake not putting state oversight into the process. Over the past 15 years, politicians and real estate speculators hijacked TIF, morphing it into an unauthorized use for self-serving development projects. Municipalities are now unilaterally confiscating the property tax dollars of our public schools, counties, NRDs and community colleges in order to increase developer’s profits and avoid the political pain of raising city property tax rates.

Remember when COSTCO asked NOT to use a TIF? It was for the very reasons mentioned above. COSTCO has a policy of not asking for tax breaks that take away from public education funding.

A Journal Star article dated March 4, concerning the proposed Trinitas Ventures 172-unit living complex, states that the “developer is not asking the city for tax incentives to build the complex, but it has agreed to partner with the city to use (TIF) … to pay for parking improvements.” Neb. Rev. Stat. 18-2116 is clear that projects cannot be approved unless it is demonstrated that they will not occur or be economically feasible in the blighted and substandard redevelopment area without TIF financing.

A story on Aug. 10, 2014, in the Journal Star details another instance where the developer Ploughshare Brewing Company did not ask for TIF; the story states “an unusual situation because the financing wasn’t requested by a private developer. Instead, the city pitched the deal to Ploughshare … over the spring, after work had already begun on its new brewery.” Clearly, these projects do not pass the litmus test of the above statute.

Remember the back and forth on Washington Square’s proposed TIF? While the city and developer claim the TIF will be used mostly for utility and parking, it doesn’t change the fact that luxury condos will be sitting on top of those utility and parking upgrades. Hardly ‘blight’.

The law is clear — those incremental property taxes from “the” project must “be used solely to pay” the bonded indebtedness of the project and “(w)hen such … indebtedness, including interest … ha(s) been paid,” such property thereafter shall be taxed as is other property in the respective taxing districts. There is no justification for “leftover (TIF)  funds” in TIF-related law. Once the projects mentioned in the article (Centennial Mall, Gold’s Building, etc.) generate enough funds to pay off the bond debt, the $5.6 million of property taxes should be returned to the public schools, county and other taxing entities.

Not sure how much different it is in South Dakota, but I will say that some of the same principals apply. Once a TIF runs out, the property owner must start paying what the property is really worth. Ironically, by that time, the ownership of the property will probably not be in the hands of the current developers and investors, who walked away with a pretty penny on their investments, at a cost to our public education system and other government entities (remember, we just passed a 1/2 cent sales tax increase, on things like food, clothing and utilities to pay teachers more, because we are short on education funding-we have a over a half-billion sitting in education investment funds-then we turn around and give property tax breaks to developers who build luxury condos).

I’m opposed to ALL TIF’s, but specifically the current ones we have been handing out, that have NO direct benefit to the public and rob our education funding.

Ram it to the People, Water Rate increases, Sioux Falls city council meeting May 3, 2016

Thots of the day from the Panama Papers Source (H/T – BLAS)

From today’s USA Today:
“The collective impact of these failures has been a complete erosion of ethical standards, ultimately leading to a novel system we still call Capitalism, but which is tantamount to economic slavery,” the source wrote. “In this system — our system — the slaves are unaware both of their status and of their masters, who exist in a world apart where the intangible shackles are carefully hidden amongst the reams of unreachable legalese. The horrific magnitude of detriment to the world should shock us all awake.”

their masters, who exist in a world apart where the intangible shackles are carefully hidden amongst the reams of unreachable legalese.

Methinks the above is a frighteningly succinct articulation of the code/law/public policy maze only lawyers can easily navigate. I think it could be argued that local political activism is fighting against related evils on a hometown level.

The Always Affable and Tax Happy Mayor Huether

The little talked about Board of Tax Appeals got interesting last time around, especially when Mike Huether showed up;

I stated my objection to the increase and the mayor put his hand up for me to be quiet. He visited with Kenny Anderson, then asked me what I paid for my condo. I told them, and he visited with Anderson again. He asked me if my condo was the same as the one across the hall. I said, “Yes.” He informed me she paid $202,000. I objected, as her purchase included furniture. I also informed them they couldn’t know the actual cost of the unit because of that. (I later asked her, and she paid $10,000 less).

I started another statement of facts and the mayor raised his hand to quiet me again. He spoke to Anderson, and asked for a vote of the commissioners. All said, “Aye.” I said, “Excuse me, but I would like to know what you decided?” The mayor stated they decreased my assessment $4,000, which will determine my 2017 taxes. I informed the mayor I had owned property in South Dakota for 50 years, and never has the assessed value, the prepaid taxes and realtor fee exceeded the selling price of the property. As usual, the Mayor rudely raised his hand to quiet me.

I would not expect to be treated like that by an elected official. He is obviously more interested in acting important than caring about a voter or her problem.

He cares. About taxing the living crap out of you. Gotta pay for those play things.

 

Water conservation = Lower Rates. I jest.

The Argus Leader ED board has a brilliant suggestion;

We believe the water system should pay for itself, through the users, and that pricing for those services needs to help drive conservation.

If we feel our water bills are too high, maybe we can start by using less water?

Uh, yes, what a freaking concept. This poor stupid hippie in me has all of sudden forgotten about ‘conservation’. Except the fact of the glaring irony of your statement (so bold and finger pointing). Water rates did not go up for decades because the city was selling water at an all time high. In fact, during the Hanson administration, the water plant almost blew up. Really, it almost did. Or was it Munson? I forget.

So then we had exploding sewer pipes, etc. The city said, ‘Goddammit we are going to conserve!’ Bravo! They started handing out toilet rebates like candy and fancy low flow shower heads and garden hose thingies.

We were on our way to catching up with modern society, because once we conserve, our water rates would go down. I jest.

Quite the opposite. We started conserving, even at a record amount, then came that pesky Events Center and Jason Aldean concerts. How to pay for them? Well, it is quite simple. We start making water users, even the ones that conserve like a camel in a dessert, pay for pipes that orginally came from the 2nd penny infrastructure funds.

Oh, and what about all this urban sprawl, Foundation Park and the 22 Walmarts we need to build in the middle of cornfields? We gotta pay for pipes to them to. It’s all about those high paying jobs, you know.

So what has all this brilliant conservation gotten us? Well we got this awesome $80 million dollar pipeline that really only helped our Iowa neighbors get cheaper water that we only use about 10% of the time (because we are mandated to).

So if we really want to talk conservation and lower rates, let’s have this seventh grade math problem conversation. Those who truly conserve should pay on a sliding scale with those who don’t (and I mean a real one). In other words, if the average single family household uses less then that amount each month, they should get a substantial discount, if they don’t they should get a hefty ‘service charge’ for not conserving.

Isn’t that the enduring concept behind ‘conservation’? The less you use, the less you pay? Because the last I checked when I opened up my water bill this last month, there wasn’t a free pair of tickets to see Paul McCartney.

What was that Cotter? 70% on roads?

As a South DaCola foot soldier points out, Public Works director Mark Cotter may have ‘Mispoke’ recently on the Belfrage Show when he said “70% of the 2nd penny is spent on roads. As ‘Warren’ points out, not so fast;

I was also wondering where cotter got that 70% figure for second penny money for streets. Seemed high considering our debt service for playthings.

From page 8 2015 budget.

Street. 47.6%
Debt service. 28.1%
Culture/Rec. 14.3%
Police/Fire. 5.4%
Info/Tech (indoctrination) 2.2%
And a couple more percent split amongst several other departments

From page 8 2016 budget

Street. 51%
Debt service 26.8%
Culture/Rec. 11.2%
Police /Fire. 4.4%
Info/ Tech. 2%

The city has two reserve funds. The general fund is the city’s primary operating fund. This cover department wages, services, day to day functions. Main sources of revenue are the 1st penny tax and property tax.

The CIP is a plan, by department, that list capital projects related to infrastructure costs. The second penny funds this. Does the above look like the intent of the second penny?

Another note. The water reclamation enterprise fund (piggy bank, courtesy of the bills we pay) has 62.4 million in it. The water department has 39 million.

As Stehly has pointed out correctly, we ARE NOT spending enough of the 2nd penny on roads and infrastructure, and our enterprise funds really are turning into a ‘slush fund’ due to the enormous rate increases. Maybe Mark and Finance Director Tracy Turbak need to have a meeting a get on the same page before blasting councilors elect Stehly and Neitzert for pointing out the truth. One of these days the current administration will figure out that that lying thing will eventually bite you in the ass.

 

Property taxes (assessments) are going up in Lincoln County, but not because of the Harrisburg School District

So this email from the super of Harrisburg was recently sent out;

—–Original Message—–

From: Notification from Harrisburg School District [mailto:Notification-Do_Not_Reply@target.brightarrow.com]

Sent: Saturday, April 02, 2016 2:01 PM

To: – – – –

Subject: This is a notification from Harrisburg School District

We are hearing that some people in Lincoln County are seeing that their real estate taxes have taken a big jump.  What we understand is that most of this is due to higher assessments on property.  The Harrisburg School has again not raised their tax levies for the 9th year in a row.  Any increases you may see are not due to an increase by the school.  Jim Holbeck

The assessments are up in Sioux Falls to. Funny how this city is swimming in money and we have all this borrowing power, of course we do, we keep increasing taxes.

HB1182 passes senate, one of the most ignorant decisions the State Legislature has ever made

I have been following the state legislature for many years, and passing a regressive sales tax increase to give raises to one sector of public employment is probably one of the worst things I have seen our state legislature do in recent memory (besides all the social issues).

I won’t rant about all the other options we had to increase teacher pay without raising taxes, we have seen those options (there are hundreds). One of the best that was actually presented to me a few years ago by representative Hunhoff (who voted yes) was pulling from our gigantic state reserves. We didn’t hear much from Hunhoff on that idea this session. He must have forgotten about it.

So what happened? The only ones voting against this were the cheap skates of the legislature, who would vote against any tax increase. But what about the other Republicans? Are they so scared of property tax and and income tax that they voted to tax the poorest of our society more? Most likely.

But the big losers in this debate? The SD Democratic party. For years they cry about the food tax and general regression of sales taxes to begin with, and when they had a chance to stand up to this and present their own plan they suddenly turn into a gigantic flock of chickenshits.

It doesn’t surprise me our doofus of a governor would concoct such an ignorant plan, I just never imagined 2/3 of our legislature was this moronic to go along with it.

I’ll pray for you tonight.

Last in Pay

One of the big arguments that comes up with bringing up teacher pay is bringing up the pay of other professionals. Is it fair to raise taxes on all of these OTHER professionals so teachers can get paid more? As I have said, it is purely ignorant to raise regressive sales taxes for teacher pay when the money is already there (heck, probably sitting in reserves). This is about presenting intelligent plans to raise teacher pay, not knee jerk reactions. People want this increase SO bad, they are willing to fall back on fiscally irresponsible and ignorant taxation plans to get it. That my friends is called GREED.

Let’s pay teachers more, but let’s pay everybody else more to, because if that happens, there will be plenty of school funding sources to go around.

I hope the sales tax plan fails on Monday, but I also hope a doable plan comes forward without raising sales taxes.

lastinpay