Anonymous Legislator drops the bomb on property taxes and developer greed

Not sure ‘who’ this legislator is, but they apparently were in the legislature for at least 14 years, they left the comment on a thread on that ‘other’ blog. Notice the trashing of TIFs, they are absolutely right, they are driving up our taxes;

A few comments on property tax and what needs to be done to accommodate meaningful and responsible legislation to address the issue.

First of all the problem was created at the local level in the name of economic development by local officials and developers. The locals wanted tools in their “economic development tool box” and the legislature always pandered to their wants. In addition developers no longer want investors to in their vocabulary, They want that investment to come from the taxpayer.

This is a complex issue and cannot be resolved in 1 legislative session, but it must be done. I saw this issue become out of control during my 14 years on the tax committee when I was in the legislature, and it has only become worse over the past 10 years.

I believe that to address this issue some concessions must be made now, they include but are not limited to:
1. Put a moratorium on the creation and limit the use of TIFD’s, by local governing bodies beginning immediately. These things have proliferated and one is never paid off before several more are initiated. 12 to 20 active TIFD’s in any local government is profound abuse.
2. Put a moratorium on the creation and/or use of any further discretionary tax formulas. These can also be used in a TIFD and that provision needs to explicitly deny that.
3. Put a moratorium on the creation of any additional subdivision taxing districts within local government.
4. Prohibit the creation of any new political/public subdivisions by the legislature.
5. Restrict/prohibit any new “opt outs” and freeze those already in place from renewing or or expanding those opt outs.
6. Freeze levies for a period for those subdivisions already in existence, except if they should choose to lower the existing levy.
7. Freeze all specials and road tax on real estate at current levels, unless it is a reduction.
8. Reduce bonding authority levels of all local governing bodies.
9. Further restrict growth in local governing bodies budgets.
10. Restrict the BBB tax, BID tax, and city sales tax to current levels, and prohibit the use the use of these taxes to only the general fund with an obligation to reduce property tax. It has become increasingly evident that these dollars are being used as a cash payout to developers with little or no regard for the taxpayer. Restrict BID boards and all other political subdivisions from giving tax revenue to any other body with taxing authority.
11. Require local governing bodies who have acquired real estate to get at minimum the price they paid for the property, rather than just a fraction of what they paid for it.
12. Prohibit any non-profit with taxing authority from asking for any local governing body for contributions outside of their tax base.
This certainly is not a complete list, but it is a beginning. I firmly believe many of these things need to be done for accountability at the local level. I blame the legislature for many of the problems associated to property tax increases. Most off the issues prevalent today are caused by the term “economic development”, in an effort to lower taxes. It doesn’t work, never has worked, and will never work. Countless studies have indicated, time and again, that these issues cause an increase in taxation rather than a reduction.

Furthermore these thing are being abused by the affluent, developers, “non profits”, and the unknowing and uninformed (local elected officials), all at the expense of the local taxpayers,
and that is a fact. Local property taxpayers are being lead to slaughter in the name of corporate welfare, and it needs to stop. If a developer thinks he/she has a valid idea he/they should have no problem finding investors to support the idea without the taxpayers investment which, is a liability on them and never produces a dividend.

I know this will be a hard sell as developers and the unknowing locals will fight it with a vengeance. It has become apparent locally that elected officials don’t run the show, they are kept in the dark and fed sh_t like a mushroom.

Ask some hard questions of local officials about current activities in your area. They refuse to answer, skirt the issue, or lie. I have investigated and found the answers and the truth. Documentation is damning.

To provide adequate property tax relief requires doing a responsible study as to the real problems associated with it. To get a responsible study all of the issue listed previously must be considered, and that cannot be done responsibly during a short legislative session.

Initiating some or all of the previous stated issues can go a long way to improve a comprehensive study and reduce inflated values and property taxes. I understand the legislature did not cause the problem entirely, but they did enhance it and became enablers for the local governing bodies, who do not responsibly use the tools given to them. I know they asked for it, but like a child who doesn’t understand, sometimes you must take away their gift until they can totally understand the ramifications of improper use.

Municipalities are allowed a sales tax. The purpose behind that was to supplement their general fund budget. Not to use as grants to developers for millions of dollars.

There is a lot going on, misuse of those dollars needs to be cornered, if it is not it will only become worse for the taxpayer.

No new taxes would be necessary if local governments were made to be responsible.

Mayor TenHaken has approved $100 million in professional contracts w/o an RFP (request for proposal)

So amazing when you hear a councilor spout off about something NO ONE in the public was aware of. So Curtis the Blurtist decided to go off about how the council was left out of negotiations on the ambulance service, and to be quite honest, this is a bad path, and I 100% agree with him. We need to implement a municipal ambulance service. We are already doing it (SFFD) and we are getting F’ing zero ROI of assisted calls. This isn’t rocket science. You equip all the fire stations with ambulances and EMT’s. You give them union benefits and pay, and you hire a 3rd party insurance collector for revenue. It baffles me we have a contract with a company that literally relies on taxpayer funded EMT services to assist them and we get ZERO in return. Even councilor Soehl brought up that we should explore this, because the current setup with the fire department is f’d (because they are the first responders to calls, and basically hand off the patient to a taxi service. Oh, and I have witnessed it. Rode past emergency situations and the only EMT’s on scene are SFFD. And they literally prepare the patient for transfer and the ambulance shows up, and the SFFD puts the patient in the ambulance. It is a f’ing joke.)

But back to the RFP’s. Tonight while Soehl was ranting about RFP’s and other contracts he said this;

“Mayor TenHaken has approved $100 Million in NON RFP contracts since he has been mayor.”

WOW! And you waited seven years to tell us this!!!!!!???

First, some clarity. RFP’s are proposals sent out to potential professional contractors, they submit their bids and low (but qualified) usually wins. But in a weird rule in the charter (Munson was guilty of this a lot) the mayor can override any RFP and pick the contractor of their choice. I’m ok with this rule, BUT, you must first put out a bid for qualified contractors.

There’s been a lot of talk lately about city government is NOT corrupt. But when our mayor hands out millions to his buddies without constituent knowledge, there is only one word for it; CORRUPTION! and maybe a couple more like integrity and ethics?

Poops, I have always known you were corrupt, but this puts the nail in the coffin. WOW!

And Curt, thanks for the Rex Rolfing dented siding moment. And if you knew the mayor was this corrupt, what did you do about it? Chirp. Chirp.

Also, there was a city council joint meeting with the Laughing Waters County Commission. Doesn’t matter what happened, but this hot mic from a commissioner made me laugh after the commission approved the denial and awaiting the council to do the same. Well apparently the discussion irked a county commissioner as you could here her say into a hot mic, “If the council votes against this I am going to lose it.” (or something like that, it was fuzzy, but understandable.)

And folks, these are the Clems ruling us. They make Trump look like Ghandi.

Speaking of poor folks getting screwed, my favorite Steve Earle Song (it’s my life story);

Instead of Op-outs maybe we need to make TIFS harder to get

Ever since the State Morons in Pierre changed the rules for TIFs (can be for economic development now) They have exploded. I suggest that we limit them to severely damaged lands and low-income housing. The school district just did ANOTHER opt-out, and lied to the public about our taxes increasing. A foot soldier left this comment about the opt-out on Turdbook;

As regular taxpayers are asked to fish into their pockets for $2.1 million of additional money, each year for the next 10 years, be reminded that just for the TIF package given to the developers of The Steel District, the Sioux Falls School District will forego (aka not collect) $1.05 million in real estate tax revenue from those parcels in 2026. For the TIF package given to the developer of Cherapa II, the Sioux Falls School District will forego nearly $1.2 million of real estate tax revenue from those parcels in 2026.

In other words if we started eliminating TIFs and close out the current ones our taxes would actually go down. Did you know that 80% of property taxes paid in the school district and city are from single-family owner occupied homes. So yes, we are paying for these TIFs. And for what? A parking ramp? Public art? Tequila Bar? Seriously! If we eliminated ALL the TIFs we have on the books now the school district would take in MILLIONS in revenue from the big commercial developments. Why are homeowners asked to pay the majority of taxes in Sioux Falls? It should be a 50/50 split between homeowners and commercial property. TIFs never have much of a ROI, studies for decades across the US have shown they don’t stimulate growth and produce very few jobs except when being built. TIFs are a boondoggle and the average Joe is taking it in the shorts. In memoriam of a certain developer who passed recently, the council should make steps to eliminate TIFs from our city, once and for all.

History Lesson

Big thanks to Mike Z for finding me this video. (FF: 14:00) It lays out why we need to get rid of the 50% councilor race approval. The facts are on our side. But will the current council look at them, or brush them aside to save the integrity of a former city councilor who had the ethics of a street rat. (I could write a book about the vindictive nature of the former councilor who implemented this insane rule.) So do you do the right thing and change this back, or will you continue to defend a councilor who didn’t know his ass from a hole in the ground. We know what will happen. Power is cancerous, and if you continue to defend this stupid rule, you contribute to the cancer of local government. Do the right thing for once. You may not get accolades and flower bouquets, but you will feel good. KILL THIS RULE!

*Also, this former councilor has been on a VINDICTIVE tour after he left the council. Trying to get former political foes fired from their jobs on trumped up charges. I will say this, if I ever see this person in Sioux Falls, they best prepare themselves for a long convo.