Three Big Reasons Why I Can't Support the Flat Tax Rate Proposal

As we come closer to the actual vote on the budget at tomorrow's council meeting, I thought that I would mention why I can't support the proposal that we received from city administration - and my reasons fall into three areas.

First, the proposal is unfair. Our previous tax system was based on the assessed value of a property. The reasoning behind that long-practised system is that people who own more expensive homes likely can afford to pay more taxes than people who own less expensive homes. It also indirectly recognizes that more expensive homes tend to be located in areas of the community which have a greater level of services - more parks and green space, for example, newer infrastructure, paved streets.

The new system will put in a flat tax of $100 on every residential property, then add on a percentage tax increase. One of the reporters for a local web-based news site has done some number-crunching that shows that applying this system will mean that a small home with an assessed market value of less than $100,000 will face a increase of about 10%, the owner of a mid-range property ($100,000 - $200,000) will face an increase of about 5.1%, and the owner of a high range property with a value of over $200,000 will face an increase of less than 3%.

There are some members of council who will say that the high-end property owner is still paying more tax, on a straight dollar to dollar comparison, than the lower or middle range property owner. I know that. The idea is that, similar to income tax, those who can afford to pay more should pay more. Presumably they have more disposable income, and, along with their more expensive home, can afford to pay more taxes. A 10% increase for a widowed senior living on a fixed income is going to cause far greater problems for her than a 3% increase to a double income family that has far more disposable income. And of course, the option for moving to a smaller house in a less prestigious part of town is always open to those who feel that the current system is unfair, but you don't see too many people doing it.

It's interesting that the proposed tax rate for commercial property owners is graduated, because it was seen as unfair to have the same flat rate for a small business owner as for a large business. Even so, the same projections show that a small business owner will have a tax increase of about 17%, the medium business an increase of about 6%, and the large business an increase of about 3%.

My second objection is that the proposal shows serious inconsistencies. The difference in approach between commercial and residential properties is one inconsistency. Another is the arbitrary difference between apartments and detached homes. A detached home will have a flat rate of $100. Apartment buildings will be assessed at $35 per apartment, even though an apartment will likely be home to the same number of people as a small house.

My final objection is the distinct lack of rationale for the setting of any of these rates. The only apparent objective was to raise $1 million through the flat tax alone, to be used in setting up a capital reserve fund (although this council has a bad habit of raiding its reserves for such initiatives as Neat and Clean). While setting up a reserve is certainly a sensible thing to do, and one that previous councils did through the debt reduction levy, which has now been directed solely toward the soccer centre until 2017, I wonder where the $1 million number came from. It doesn't appear to relate to the various numbers thrown out for future needs or for making up maintenance shortfalls from previous short-sighted budget decisions.

I wonder how we got to solving all our problems with a flat tax and a general increase of over 3%, when initial numbers suggested that a 16% increase would be required to meet all of our neglected maintenance needs. I would like to see proposals that clearly identify what money is needed, what money can be saved (and no, proceeding with status quo on discretionary expenditures is not acceptable to me), and then, options for finding the needed money, whether it be through increasing user fees, increasing the mill rate, reducing levels of service, or some combination.

What I find really disturbing throughout this whole discussion is the implication from some that those in lower-priced homes aren't "paying their fair share." In fact, in the anonymous comments sections of any of the articles on this topic, you're sure to find several comments along the lines of "people who live in those lower income areas are the ones calling the police and fire departments all the time, so they should pay more." What's most disturbing to me about this undercurrent is that somehow, people who live in the poorer areas of town deserve a lower level of service. The city would be better served if people realized that we need to get rid of this "us and them" thinking, and bring all levels of the city to a point where your address shouldn't matter.

I'm sure that both the police and fire get calls from all over the city. The only truly "fair" way of dealing with this would be to charge callers directly. And we could take this further - those with more children should have to pay more for education, and those who want to walk in Kinsmen Park should have to pay at the park entrance.

We don't, of course, because underlying the whole concept of municipal taxes is the idea that the city as a whole benefits from having a police force, whether we call them or not. Same with the fire department. We recognize that an educated population benefits society as a whole, and we are willing to pay for it. We recognize the value of green space, of parks, of community halls, of recreational and arts facilities. All of those amenities are supported by your tax dollars, as are streets, sidewalks, water mains, and other basic infrastructure.

I wish that council would spend its time trying to figure out how to bring up the basic level of amenities, across the city, to an equitable level, rather than worrying about complaints from people who point fingers at others, claiming that they aren't "paying their fair share", and not being thankful for the level of service that they enjoy.

"Some people are born on third base and go through life thinking that they hit a triple." - Barry Switzer