Paying our dues

Well I guess it's time to begin the annual hand-wringing over Chapel Hill's budget. The manager often overestimates any anticipated tax increases so that the Council can easily find a way to reduce or eliminate the increase. But this year they are talking about a 20% tax hike! I personally agree with George Lakoff who points out that taxes are an investment in our future (and when it's municipal, that's the not-too-distant future). "Taxes are the way we support the common good," says Lakoff.

But I know some folks will not be pleased to see this increase. It looks like the the one thing that is really busting our budget is the new Town Operations Center (TOC) that we are building. This brand new center will be a definite improvement on our current facilities which are situated on the University-owned Horace Williams tract. UNC has told the Town to move off the land to make way for Carolina North. Fiscal equity, anyone?

(By the way, the N.C. Legislature says the airport needs to stay put on the Horace Williams tract until a suitable replacement is located and constructed, leaving many officials skeptical about UNC's plans to build Carolina North there any time soon. “The university has said that the project is a 50-year plan. If that's the case, then a delay of a few years, in the long run, isn't going to matter much.” So said Chapel Hill Mayor Kevin Foy in the Chapel Hill News on Sunday.)

Regardless of UNC's plans, our beautiful new TOC is already under construction. It's just a matter of paying for it. The Town Council will hold a number of public hearings and work sessions before ultimately approving a budget this summer. What would you tell them to do?

Issues: 

Total votes: 214

Comments

I agree with the distinctions that you make, Mark, and they are important ones. It is amusing when you hear people say that they wish government would operate more like a business; you have to be careful what you wish for.

On a related issue, if the Town was paying UNC a dollar a year to lease the land where the operations center is located, was the fair market value for the lease set aside for the day the $1 deal ended or the Town had to build another TOC?

My biggest complaint with Chapel Hill is that, consistently, when new bonds are proposed, Cal Horton says he foresees no new taxes will be needed to pay them off. Then, without fail, two or three years later, he says we need a tax increase to cover bond payments. This has happened repeatedly in the last thirteen years I've lived here. Is this bad management or deception?

The bonds might be for very worthwhile projects, but don't misinform the public. Forecast what they will do to the tax rate, perhaps in a best-case and worst-case scenario, then let the voters decide.

In general, I'm a little dubious that the city budget can't be cut without cutting services. That goes for any government operation. Is Chapel Hill that lean, mean and efficiently organized? Businesses with a profit motive to keep costs down still find ways to be more cost-efficient during tough times. I seriously doubt the city government is that self-policing.

I know the town has asked for citizen volunteers to advise on how the budget can be cut. From the Herald:

The council also will appoint five to seven residents to a "Budget Review Advisory Committee," to work with the consultant whom the town will hire, and also to craft a report separate from the consultant's report. The town is advertising now for volunteers for that committee and will take applications until Jan. 10, Town Clerk Joyce Smith says.

I hope some real organizational experts will step forward to help. And that the town will follow those recommendations, even if it means eliminating jobs.

I love Chapel Hill, and I know it costs money to make it the town it is, but if the costs of living here are not controlled, I may not be able to afford it.

I think it's a great move to have a citizen's advisory group that will dig into the budget and provide some feedback to the Council. Sometimes fresh eyes see things that more jaded ones don't.

My only concern was that, by the time I first read about this committee a few days ago, the article seemed to indicate that the application process was already closed. I may have missed it earlier, but does anyone know when that "call for applications" for this committee happened?

Oops, my bad. I should have read all the way to the bottom of this thread. Thanks for the info, Ed.

Ed Neely wrote: "Businesses with a profit motive to keep costs down still find ways to be more cost-efficient during tough times. I seriously doubt the city government is that self-policing."

I hear what you are saying, Ed, although let's remember that Wall Street does things to make a buck and for no other reason. So they send jobs overseas, cut benefits, make employees work 39 hours a week, engineer tobacco to be more addictive, supress research that shows their products to be injurious etc. etc. to name just a few of the lowlights.

Fortunately the government takes into account consumer values, justice, and equity etc etc. Or at least the government can take such things into account - corporations are compelled by law to think only about the financial bottom line.

It's no surprise to me that "profit motive" would be dirty words to many readers of this blog. If it helps, don't think of Enron or Worldcom, think of your favorite local business. They have to deal with the same reality. They can have all the good values Mark describes, but if the income doesn't match the outgo, they can't just make all their customers pay more. That is an important distinction we should all keep in mind. I'm not anti-government, but let's face it, there is little incentive for government to be cost conscious, aside from citizen scrutiny.

And Mark, it's too bad you chose to address the more philosophical part of my comment. What about this blue sky method of selling the public on bond issues? You might have some insight into why on more than one occasion in the past few years we have been told these bonds would pay their own way, only to find out it just isn't so.

Anyone who votes for a bond and doesn't think they will need to pay for it SOONER or LATER is a fool. Bonds are CREDIT and should be viewed as such. I've NEVER voted for a bond that I wasn't willing to pay more taxes for. OTH--I don't vote for just any bond that comes down the pike. School bonds ALWAYS get voted for...everything else I weigh VERY carefully.

Unfortunately, not everyone takes this view.

As to why we are assured that bonds will pay for themselves down the road...perhaps because if everyone thought the way I do, then the bonds wouldn't get PASSED?

Like I said in the previous post, Ed, I hear what you are saying.

hmmm........working 39 hours a week is somehow exploitative? That's the first time I've heard that one!

without benefits?

Melanie, I agree with everything you wrote, except I think there are many people who will believe what they are told by a city official, not because they are fools, but partly because they want to believe it. They want what the bonds will pay for, and if they are told taxes will not go up, they are inclined to believe it.

And our town manager did not claim the bonds would be paid off by some magical trick. He claimed future growth in the tax base would be enough to cover them. That certainly could have been convincing to a great number of voters. I remember these articles well, because I was very dubious, and did not vote for all the bond issues because I was not convinced they were fiscally responsible. And that was just on a hunch. Turns out I was more on the mark than our paid staff.

Think about how this played out. First, we are assured that taxes will not be effected by the bonds. Now the story is that they are the main culprit for our tax increase. Is there to be no accounting for this?

So, was it misjudgement, mismanagement or deception? Take your pick, it had to be one of them. Melanie implies it was deception. I leave the question open to get whatever other views might be out there.

OK, I hope this is my last rant on this subject. It's just very aggravating to me. This is why I was opposed to the Ammendment One in the last election. This situation just raises my level of concern.

I hope everyone has a wonderful holiday, and a prosperous New Year. We're likely going to need it.

Mark, I didn't catch the subtlety of your comment, which I take to mean that a 39 hour work week is an attempt to subvert the "full time" position + benefits model of employment. Now I gotcha!

Finance Director Kay Johnson also was quoted in Matt Dees' CHN story saying: "The town also will see its annual payments to settle outstanding debts go up, Johnson said. It's an unusual situation caused by an error made years ago during budget planning, she said."

What was the error?

Whenever I see the statement (or similar) that "Taxes are the way we support the common good" I have to laugh.

That statement assumes that there is ONE good that is GOOD for ALL of us and that's just not true. Give people the freedom, or "choice" if you prefer, to pick their own GOOD. What's good for me might not be good for my neighbor and vice versa.

Fred, I understand that it is an "..incorrect assignment of debt service from a bond
back 8 years ago or so. It amounts to 1/2 cent for a year or so..."

I'm trying to get further information on this, but I wonder what other 'unexpected' bond related expenses we will see.

Bill if you don't think schools, roads, police officers, and fire protection are good for you then I invite you to move out of the municipal area where they are provided.

Of course we don't all agree on how to do it, but I do believe that there is a consensus in our town that those things are collectively good and worth investing in.

Uh, Ruby, even us country rubes have schools, roads, police, and fire protection funded by public taxes (common good). ;-)

Ruby, re. the comment to Bill, maybe a separate discussion on "values" might be useful, especially given the comment by Finance Director Kay Johnson:

"'The citizens' group will represent and express community values," Johnson said. "If the consultant was to evaluate the budget in a vacuum, they might find that something is inefficient. But the committee might find reducing funding would lessen the level of service the community wants to obtain. Their job is to act as a sounding board for the consultant.'"

What are the "community values" that the group will represent.Was the renaming committee make-up a similar endeavor?

I would be curious to hear the various viewpoints on this.

Good point, Terri. "Municipal" is the wrong word. Maybe "civilized?" ;-)

"If what's GOOD for me is clean air, is it OK for me to take actions against my neighbors who are infringing upon my rights? This is the issue I really don't get about the libertarian view. How are conflicting “goods” supposed to be resolved? "

Life, liberty and the pursuit of happiness, Donna. If your happiness is wrapped up in clean air, then YOU drive an econobox that gets 40mpg. If my pursuit of happiness leads me to drive an SUV for business purposes or a minivan tpo haul my kids around, then that's my happiness.

That's my gripe with the liberal way: if it's GOOD for one person, then it must be good for all people. If something is bad for one person, then it's only fair that it be bad for everyone. This was the rationale that John Conyers and Fritz Hollings used recently when they proposed reinstituing the draft (You mean it was a Democrat that proposed resurrecting the draft?? The horror!) Conyers said that military service was bad so it should be bad for everyone. Hollings thinks that military service is good so everyone should take part in the goodness.

Yes, Ruby, or maybe we should just say "governed." The Kalahari 'bushmen' are (or were) essentially ungoverned - not uncivilized.

But in any case, Bill, I don't think there is any assumption that all tax expenditures are good for 'ALL' - at least not by the narrow interpretation that you would no doubt like to apply. Still, I bet you drive on the interstate and local roads paid for by federal-state-local taxes, have a mortgage (or live in a building on which someone else has a mortgage) made possible by the government, use dollars printed by the US treasury, and (evidently) use the internet which is financed by the federal government - to name just a few items.

Fred, values would be a good discussion. It was of course the thrust of my first post - although the 'business' model can bring some important values to the table, we both agree that there are other values that are important as well eg recognizing that Town employees are valuable members of our community.

Finally, Ed, I recognize the issue you are raising (and Melanie is also acknowledging) that General Obligation bonds must raise taxes. If nothing else they prevent (hypothetical)lowering of tax rates. I don't think the Town of Carrboro ever represented that the Sidewalk Bond would not require tax increases. In fact, one candidate in Carrboro in 2003 said that Town planning documents call for dramatic tax increases (even without those bonds). So I don't think that Carrboro voters were deceived on that point. I could be wrong about that, and if someone has evidence to the contrary I would like to see it (and would gladly eat my words).

Ruby, you pick the most obvious examples of government's duties (roads, police officers, etc) as a description of the "common good" but ignore that the Chapel Hill government does MUCH MORE than just that and much of that work is, I maintain, dubious and unecessary and cloaked in the robes of "common good." Free bus service for instance. Yes, bus ridership is up now that the bus is free. But do we know if that increase in ridership means everyone came out of a car and got on the bus? No, we don't. Some of those people surely got off of bikes and started riding the bus. Some of those people were probably walking and now take the bus. So while free bus service is "good" for some, it's not good for all by any means. As a Chapel Hill property owner, I now face a 20% tax increase to subsidize free bus ridership? As a Chapel Hill property owner, I now face a 20% tax increase to pay for the renaming of Airport Road and the reimbursement of business owners and property owners affected by the change? And that's good for me how?

I know from your posts and that of otthers that you are not sympathetic to any sort of libertarian viewpoint but government was designed to fulfill a limited number of roles--some of which is does very well: public infrastructure, sewer, water, etc. However, there are many things that government does NOT do well and should not even be involved in. All too often for my taste, those activities are justified as serving the "common goods."

Free transit is a means to environmental protection by reducing the number of parking lots (impervious surfaces) and pollution in city air space. Do you really think that if government didn't create policies and oversight of environmental protection that people would monitor their own behavior for the common good? The number of SUVs on our roads are a good indicator to me that personal preference/convenience is a higher priority than the (environment) common good.

Other obvious town services that serve the public welfare include (but are not limited to) public works, economic development, land use planning and management, recreation, and the library. Which of these should be eliminated from a libertarian perspective?

Free transit is great example of what I consider the folly of the "common good." When implemented, "common good" is a code phrase for "the elite's idea of what is good for the commoners".

While you state that free transit is good for the environment, like I mentioned earlier, you have no way of knowing what method of transportation was discarded in order to get on the bus. You are assuming that everyone hopped out of their cars but you don't know for sure--were they walking before, riding a bike? Without knowing, you can't verify a hard $ benefit of free transit. With a hard $ benefit, you can't determine if this "common good" solution is cost-effective.

A basic principle of economics is that if any good is sold (or given away) for less that the true price of that good, a shortage will ensue. What happens if more and more people do start riding the free bus? As more and more people take advantage of free transit, more $ will be required to buy more buses, hire more drivers, etc. Where will those $ come from? Another 20% tax hike for the common good, I guess?

Your other example decrying the number of SUVs on the road as being against the common good just reeks of liberal elitism to me--"if only these fools knew what they were doing to the environment they would get out of their SUVs. Well, since they are fools, we'll MAKE them get out of their SUVs...for the common good, of course."

If you are arguing for more structured research and planning along with evaluation criteria around programs such as the free bus program, then I am in total agreement with you. But we may not agree on the criteria that would be used in the evaluation. For example, I like cost-benefit or cost-effectiveness analysis, but from a social science perspective rather than just financial accounting (your "hard $ benefit?). A social science analysis would determine the costs and benefits of each option, such as walking, biking, riding the bus, and driving, through a combination of accounting figures (salaries, materials, etc.) and inferences (pollution and exercise). I believe that a public process could be undertaken to hash out those inferences that could be credible to anyone who came to the process with an open mind.

FYI--I did such a cost-benefit analysis of the Florida State football program. The faculty in the School of Education, who were always complaining about the funding inequities between academics and athletics, actually accepted my analysis (which came down in favor of college athletic programs as a common good).

About free bus service: I admit to being torn over this issue. On the one hand, I like the convenience of my Mazda 623; I can hop in it, fill it up with groceries and be done. On the other hand, I like the idea of a leisurely 25 min walk to the nearest bus stop, going to the mall to pick up a few things or going to my favorite coffee shop to read or do household chores like paying bills or making lists. And if I can prevent, in my own small way, some toxic fumes being emitted into the environment, that is appealing to me as well.

As to the issue of SUV's: I think people own large vehicles for a variety of reasons. We recently purchased a big ol' truck because my husband, at 6'4", was tired of hunching over the steering wheel (he communtes to Raleigh daily). He says that fitting in the vehicle (and not having his view obstructed by the rear view mirror) has made him a calmer driver.

Terri,

Thanks for your reply. At least we agree on the effectiveness of cost-effectiveness analysis. :-)

I would be interested in seeing such an analysis done on the proposed gas powered leaf blower ban. My hunch is that the costs would far outweigh the benefits. The costs could include higher landscaping costs--either from the greater amount of time required to service a yard without a gas leaf blower or from the expanded number of workers required to service a lawn in the same amount of time as before. Then there's the cost of everyone who had a leaf blower who is now stuck with a gas-powered doorstop...

I don't even know how you would start to measure the benefits--I don't see how a hard $ benefit could be determined. If 3,000 gas leaf blowers are removed from Chapel Hill, that's less spew in the air but how much spew and is that reduction in spew worth the costs? Is the spew created by 3,000 greater or less than the spew that is belched out by a city bus driving around empty all day?

Donna, regarding your comment about why people own SUVs--I couldn't agree more!

Here's a lil' Chapel Hill-based anecdote to illustrate the point: my father-in-law was in town and we sent him down to Whole Foods to pick some stuff up for us. He drives an enormous pickup truck but its a diesel so it actually gets about 20mpg, as opposed to 12-15 mpg for the gas alternative. When he got out of his truck, someone in the parking log hissed "gas guzzler!" at him. The irony is that my father-in-law is an environmental engineer who travels around the country in his diesel truck hauling a trailer of the equipment that he uses to clean up SuperFund sites. How ironic: someone sees his truck and brands him a "gas guzzler" and all the negative connotations that go along with that, when in actuality, my father-in-law is wokring to clean the environment of discard poisins and toxins.

You have to walk a mile in somone elses shoes before you judge...

"On advice from Town Attorney Ralph Karpinos, Town Council members decided Monday that a ban on blowers would not withstand a legal challenge."
http://www.chapelhillnews.com/news/story/1864190p-8195745c.html

First the town's definition
of "common good" is defined by the
local elected officials, chosen
by the townspeople. So if we don't like
the definition, we can change it in
November.

To my 25-year local politics recollection, there has never been a candidate for CH Town
Council or Carrboro Alderman who
has won with a platform of "throw the
current council out because they spend
too much". Many fiscal conservatives, including some who post here, have run
for council, but have always faired
quite poorly.

Let's also remember that the bulk
of our tax bill goes to the county,
not to the towns, and even if
CH were to increase prop taxes by
20 pct (which I don't think the current
council will allow), town taxes
would still be far less than the
county taxes.

Finally, with regard to the "free"
bus service: The reason the bus
system works so well (as measured
by ridership) is not primarily because
of the lack of fares -- it is because
parking is scarce on the UNC
campus, including the hospital area.
Were UNC to add 20,000 additional
spaces for faculty, staff and students
(neither Joannie Mitchell nor I am promoting this), ridership
would drop like a stone and people
would drive, one person per car to
the campus, as per the RTP.

The bulk does go to the County but look at where it is spent. A different picture emerges if you break the taxes down this way: 48% of the County budget goes for schools, so that's a rate of 0.42. Add the CHCCS rate of 0.20 and you now have 0.62 for education, 0.46 for the remaining County services, and 0.575 for Chapel Hill taxes and even more for Carrboro.

Factor in the new increase in the tax rate (whatever it turns out to be), the new "fees," and the property revaluation, and most people will will most likely see a significant increase. In theory, a budget reflects priorities; let's hope that there is wide buy-in on the priorities we fund.

Bill,

Another Chapel Hill antecdote. I recently saw Eric Montross at a coffee shop. He drove away in a monstrous pick-up truck. Nobody hissed at him, for obvious reasons.

"Give people the freedom, or “choice” if you prefer, to pick their own GOOD. What's good for me might not be good for my neighbor and vice versa."

I would definitely agree that many people make decisions that are not good for their neighbors: "SUVs and minivans constitute half of all new car sales, most of them bought to serve as passenger vehicles. Yet current federal standards allow them to emit more pollution and consume more gasoline than cars."
http://www.ucsusa.org/clean_vehicles/cars_and_suvs/index.cfm

If what's GOOD for me is clean air, is it OK for me to take actions against my neighbors who are infringing upon my rights? This is the issue I really don't get about the libertarian view. How are conflicting "goods" supposed to be resolved?

Fred Black wrote: "0.575 for Chapel Hill taxes and even more for Carrboro."

Fred, it's definitely worth the extra money.

Bill,

You meant your post for Terri B., right?

Donna, if you are referring to post "Comment at 2:43pm 12/18/2004 by bill oliver", yes, that was in response to Terri's post of "Comment at 5:29pm 12/17/2004 by Terri Buckner". Sorry about that!

 

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