Gameplaying With Hot Potato Of 13 Tax Rate Hike Must End
Written by Michael Lewis on July 30, 2009
By Michael Lewis
Miami-Dade is playing a perilous game of hot potato with a 13% tax increase plan, exacerbating the worst recession in 70 years.
First, Mayor Carlos Alvarez lobbed the county commission a rate hike of less than 1% for next year, well aware that service cuts he proposed to balance that budget would never hold up under pressure group lobbying.
The suitably pressured commission next played its role by fretting over details and then totally abdicated its key duty to set a ceiling on taxes, instead tossing the mess to newly elected Property Appraiser Pedro Garcia.
By state law, Mr. Garcia then had to set a ceiling high enough to cover county spending a year ago, called the rollback rate. That, coupled with the 9.5% fall in countywide appraisals, required a 13% rate hike ceiling.
Those who orchestrated the game expect it to play out this way:
Commissioners can decry Mr. Garcia’s huge hike, though he had no hand in it.
They’ll next cut the rate increase back from 13% to perhaps 10% and brand themselves heroes for their cuts, telling voters how much they saved us.
And the mayor then won’t veto a huge tax hike that he never budgeted, keeping county hall fat while saying he’s just carrying out the commission’s will. He’s the good guy.
So everybody wins except two parties: Mr. Garcia, who takes the rap for a massive increase that he in fact had warned against, and the taxpayers, who as their property values and net worth rapidly shrink will pay a far higher tax rate.
Despite dire warnings of massive cutbacks that would force the county to spend only 5% more than it did three years ago, after the hot potato game ends it’s likely to be up 10% from then.
The rate ceiling that Mr. Garcia was required to announce would raise county taxes on a $250,000 home an average of $317.50, varying with exemptions. That won’t thrill taxpayers.
Unfortunately, most voters aren’t taxpayers, a fact that will heavily influence commissioners’ ultimately September vote on the most ill-timed of tax hikes.
Miami-Dade has 1,234,944 registered voters, but tax rolls list only 861,194 properties. Because some persons own more than one property and some property owners don’t vote here, we probably have far fewer than 600,000 taxpayers locally — less than half the total voters.
Furthermore, proportions of property owners vary among the 13 commission districts, and many owners in some districts vote elsewhere in the county.
Commissioners are aware of their district’s ratios of taxpayers to voters. They understand what percentages of their voters wouldn’t be directly hit by a tax rate hike. Many will vote accordingly.
That’s just one more strike against county district elections: some commissioners don’t lose many votes by piling more and more on the backs of taxpayers. Countywide voting by district would wash out that disparity.
As it is, while we formally have a strong mayor we actually have a mayor who ducks key issues and hands the hot potato to commissioners, who by abdicating their duty on tax rates prove that we also have a weak commission form of government.
After all, if commissioners’ key duty isn’t to set tax rates, what is it?
Commissioners complain that the mayor gave them only days to review his budget before they had to vote. That’s true. It was the same strategy that passed a baseball stadium vote on deadline.
But, as in the stadium case, commissioners refused to vote based on the bottom line. In the stadium’s case they never learned the bottom line, and most didn’t care. In this instance, they forced someone else to take the fall for an unreasonable rate hike for property owners whose investment values have plummeted.
After hearings Sept. 3 and 17 commissioners must themselves set a final rate. That’s one hot potato they can’t throw to Mr. Garcia or anyone else.
A handful of commissioners won’t buy a big hike, or any at all. An equal group doesn’t seem concerned what taxpayers may face, perhaps because they represent fewer of them.
That leaves two or three commissioners to decide whether it’s more important to feed the government money machine or to leave something in taxpayers’ pockets in the most difficult year of their lives.
Most lobbying will aim to save this program or that one — that is, to whittle down or eliminate any spending cuts.
Groups pressuring for individual programs are far better organized than the disorganized mass of taxpayers as a whole, and county agencies themselves round up constituents to lobby for their jobs, salaries and programs.
But this is a year when we have to stop the game-playing at county hall. The economy demands it.
Can we possibly find seven commissioners who understand that?