Two things are inevitable – death and taxes – according to the old saying.
Some people claim tax increases are also inevitable. That may be true, especially if you read all the stories about city, county, school levies this time of year.
Each local governmental body has to work on its budget for next year, and then propose a tax levy for the amount of money which will be raised locally through property taxes.
We, as members of the media, then report on these proposed levy increases.
Several years ago the state decreed that local boards and councils had to follow a new timeline.
In September, most of them announce a proposed tax levy increase. But the actual tax levy increase – or decrease if that is possible – is done in December.
This causes a lot of confusion and upset citizenry. They read in the newspaper and hear on the radio that the levy for the City of Blue Earth will increase by 22 percent, for example.
Which may be true, but more than likely will not be. The city council has the option to lower it, if they wish, but they cannot raise it any higher than the amount which they have “certified” to the county auditor.
Likewise the county board has a proposal for a 7.6 percent increase. They say they hope to lower that amount before they set the “actual” amount in December.
School districts are usually the one exception to the rule. They are told by the state what the maximum amount for their levy can be.
Almost every school district automatically sets their levy at the prescribed amount, and rarely cuts it back.
The problem they have is they don’t know what the final amount of increase they will be allowed.
This means they don’t like having to set an actual dollar amount, and find out later that the ‘final’ amount could have been higher. Thus, they word their motion to set the levy increase at the highest amount allowed by the state.
We don’t blame the school board for this. Due to declining enrollment (and thus fewer dollars in state aid), they need all the bucks they can get.
The system devised by the state is what seems to be screwed up.
We get the idea, and it is one of those ideas which might have been good in theory, but not in practice.
The state wants a local government to work on its budget early and figure an amount for a levy increase.
Next comes a Truth and Taxation Hearing, where upset residents may come to and question the increase in levy.
The government body cannot set the real levy amount the same evening, but must do it shortly after.
The theory is if enough citizens are outraged, the government will reduce its spending and thus reduce its levy increase.
Good theory, but real life does not usually work this way, especially as far as governments go.
What actually happens in most cases is this:
- Government body sets a “proposed” levy increase, meaning taxes could go up. It is a big number, because the board or council cannot raise it higher later, only lower it.
- Local newspaper reports this percentage. People read it but if the number is “reasonable” they do not respond. If it hits double digits, there had better be a good reason, they say.
- Hardly a soul shows up at the Truth and Taxation hearing. Maybe one person who questions why the increase is necessary.
- Board or council responds that the increase is not going to be that high, as they are cutting back on the levy amount needed.
- Everyone goes home happy.
- Newspaper publishes another story with the “real” levy increase, causing more confusion among the public as to how much their taxes are actually going to go up next year.
The answer may be that we are jaded and firmly believe that death – and an increase in taxes – is indeed inevitable, and we can do very little about it.
Our only recourse is the election box, if we feel a change is needed in how much tax increase is too much.