Property Taxes Are Beloved Everywhere

[posting]

The View From Myrtle Beach: Property Taxes Are Beloved Everywhere by Richard Tindal

This is the first in an occasional series of articles depicting the similarity of local government issues north and south of the border.

Property Taxes Are Beloved Everywhere

It may come as no surprise to Kingstonians to learn that property taxes generate lots of flack in Myrtle Beach as well. There is an interesting parallel, because the latest property tax complaints arise as a result of regularly scheduled property reassessments rather similar to the arrangements in Ontario. Down here, it is the county that undertakes the reassessments, and it must do so every five years – as part of a commitment to ensure that assessments and taxes are equitable. With the real estate market around Myrtle Beach booming, however, the latest reassessment triggered substantial tax increases in 2005 and something of a taxpayers revolt. There have been the usual cries about people being taxed out of their homes and about excessive taxes in relation to services received.

The property taxes we pay, of course, don’t reflect benefits (services) received. Nor do they necessarily reflect ability to the pay – except to the extent that there may be some correlation between homes of high value (and assessment) and the incomes of owners of such homes. Since property taxes reflect the actual value of our property, they inevitably track upward when the real estate market is strong. Mandated regular reassessments, designed to capture the inflated property values, also help to ensure that these tax increases occur. [Yes, it is appreciated that municipalities could lower property taxes proportionate to the increased assessment values, so that the actual tax impact remained the same – but that almost never happens, for a variety of reasons.]

In response to the taxpayer complaints in South Carolina, the Governor has been musing about an initiative to increase the sales tax (as a way of gaining additional revenues for the local level) and to place a limit or freeze on property tax increases. Such an intervention from the state level – to limit property tax increases – is somewhat reminiscent of Ontario’s intrusion into municipal affairs through the capping of business tax increases in recent years. Also familiar is the call down here for more revenue sources for municipalities, to reduce the dependence on the property tax. If all politics is local (as Tip O’Neill famously said), it appears that nothing is more political and local than the municipal property tax.


The other articles in this series can be found at the following links:

The View From Myrtle Beach: Property Taxes Are Beloved Everywhere (http://www.kingstonelectors.ca/forums/showthread.php?t=1204)

The View From Myrtle Beach: Taking the Bus (http://www.kingstonelectors.ca/forums/showthread.php?t=1203)

The View From Myrtle Beach: Be Careful What You Wish For - Property Tax Reform (http://www.kingstonelectors.ca/forums/showthread.php?t=1202)

The View From Myrtle Beach: What If Patients Were Revenues Instead of Costs? (http://www.kingstonelectors.ca/forums/showthread.php?t=1201)

The View From Myrtle Beach: Rocky Movies and Property Tax Reforms (http://www.kingstonelectors.ca/forums/showthread.php?t=1200)

[Exhibitionist]

Two thirds of Ontario voters oppose giving local councils new powers to raise taxes and extend local bar and shopping hours, shows an SES Research/Osprey Media poll.

The poll also showed voters are split over whether Ontario mayors should get greater authority envisioned by new provincial legislation.

Just 34 per cent of those polled agreed municipal mayors should have more power and 16 per cent somewhat agreed.

Another 35 per cent opposed more powers for mayors and six per cent were somewhat opposed. Just over one in ten surveyed answered unsure or neither.

Theres not a huge up swell in support for new powers for mayors, concluded Nik Nanos, president of SES Research.

Meanwhile, there appears to be little appetite for potential new tax powers that could come with municipal reforms introduced by the provincial Liberals earlier this summer.

When asked whether municipalities should have the power to impose new taxes on alcohol served in bars, restaurants, movie theatre or sporting events, 66 per cent disagreed compared to the 30 per cent who supported the proposal. Just four per cent of those surveyed were unsure or answered neither on the question.

Ultimately, it could lead in some communities to new powers the power to tax movie, sport and concert tickets, booze sales in bars and restaurants and authority to extend the hours of operation for retailers, and bars past two a.m.

It proposes to force city councils to be more open about closed-door dealings and gives them broad new powers to manage local affairs

Ontario municipalities will have more power to control their own destinies if the proposed legislation passes, Gerretsen told the Legislature.

Our goal is to give municipal governments the respect they deserve and the tools and instruments they need to meet the challenges of todays competitive economy, he said.

The City of Toronto, in separate legislation, has already received broad new powers to tax and control local matters and received new powers for its mayor and city councillors including the right to strike powerful new executive councils.

Toronto council now has authority to add a local tax onto hotel bills, no longer needs provincial approval for traffic calming measures such as speed bumps, can toll roads and has more flexibility to set speed limits.

It also received broad permissive powers over financial management, business licensing, tendering, consumer protection and authority to delegate more power to local bodies.

Toronto can create its own lobbyist registry, hire its own integrity commissioner, auditor general or ombudsman and can choose to prohibit trade unions and corporations from donating to municipal campaigns.

Municipal reform legislation Gerretsen introduced for the rest of the province could see many of those same powers applied across the province though its likely large cities will see the most change.

While mayors could end up with more control over the budget process, for example, proposed reforms may have other sweeping implications for many communities.

Municipalities may be given, for instance, greater power to offer bonuses (perhaps such as tax breaks and holidays) to attract and retain businesses.

There may also be explicit, broadened power to expand the use of local improvement charges to pay for things other than roads, sewers and sidewalks and more clearly defined ability to charge user fees.

Gerretsen has said he doesnt intend to rush the reforms and, should the Liberals win re-election in 2007, it will likely be a couple of years before the government gets around to hammering out the details of new, province-wide municipal powers.

Nanos said the poll results suggest theres not currently much support for changing the status quo on municipal powers outside of Toronto while the prospect of new tax powers for Ontario municipalities may not fly.

If any of the new powers for mayor have anything to do with new powers to tax, on booze and entertainment activities, that would see a significant backlash, he said.

Even if support grows for more power for mayors, that doesnt necessarily mean therell be support for new taxation, Nanos said.

The telephone survey of 500 Ontario voters was conducted between Aug. 12 and Aug 15. It is considered accurate within 4.5 percentage points, 19 times out of 20.