Thursday, June 29, 2006

Is There Global Warming? It's The Wrong Question.


There are four possible truths regarding global warming:

1. There currently is no global warming.
2. There currently is global warming.
3. People do affect global warming.
4. People don't affect global warming

and two possible actions:

A. We change our behavior
B. We don't change our behavior.

There are eight possible results.

Outcome 1-A. If there is no warming, behavioral changes make no impact and produce only this:
Lower consumption of fossil fuels, significant changes in daily life, new technology, development of mass transit, significant economic impact on energy producers and automobile makers, new emphasis on renewable energy resources, cleaner environment, lowered dependence on foreign oil etc.

Outcome 1-B. Nothing changes. Unless of course, we run out of fossil fuel and are unprepared for it.

Outcome 2-A. The same as 1-A but there would be a beneficial effect on global warming, though the results will take years to occur.

Outcome 2-B. The world continues to support economies dependent on oil revenue, we continue to promote environmental pollution and hasten the global damage resulting from greenhouse gases in the quest for cheap oil.

Outcome 3-A = 2-A
Outcome 3-B = 2-B
Outcome 4-A = 1-A
Outcome 4-B = 1-B

We should be talking about consequences of being wrong in our assumptions and how quickly and effectively we can remedy any damage caused by a wrong decision.

We will either have to rebuild an economy disrupted by a fear that never materialized or we will have to restore the climate and environmental damage (perhaps impossible by the time it's acknowledged) caused by the continued use of and exploration for fossil fuels.

It seems to me that being wrong about the environmental damage is a far greater disaster than if we are wrong about the economic consequences.

But maybe it's just me

Wednesday, June 21, 2006

"Without fair treatment from government, little else matters"


Which of the following would you choose?

1. Property taxes bills unrelated to town expenses. Budgets increase, yet about a third of property owners pay LOWER taxes.
2. Onerous tax increases force many long time homeowners to sell.
3. New owners taxed on market value of property are often shocked by tax increases after revaluations.
4. Expensive revaluations add to budget costs.

or

1. Property tax bills are directly related to budgets.
2. Tax burden increases are fairly and equitably shared by existing owners.
3. New owners taxed as above but become existing owners after purchase.
4. Lowered revaluation costs saves money for towns.

If both methods will produce the same revenue, which would you choose?

The first system is what we do today.

The second is what we propose at RIGHT.

Take your pick.

Wednesday, June 14, 2006

The RIGHT tool for the job


Please forgive this paraphrase an old expression, “If the only tool you have is a screwdriver then everything will get . . .”. Well you get the idea.

Our property tax problem is a little bit like that. It appears that the only tool or remedy anyone ever proposes to fix the most hated tax in America is to control or cut tax levies. Prop. 13 in California, Prop. 2 1/2 in Masachusetts, the proposed TEL here in Rhode Island, are all such examples.

At first glance it seems like a reasonable approach. After all, the reason we have a property tax in the first place is to help fund the tax levy, that portion of the municipal budget not covered by other revenue sources such as state reimbursement from income and sales taxes, parking tickets, fees, such as dog licenses etc.

Since we all share in the services provided by our towns, we should share in the tax levy needed to provide them. Thus the efforts to lower those total expenses would appear to be a rational and fair way to reduce the tax burdens on property owners. And it would be, if we each paid our fair share every year.

We used to many years ago. We paid taxes based on the value of our property. Then someone noticed that properties were increasing in value and people were buying homes at ever increasing prices yet paying taxes based on the older values.

The solution? Revaluation. This way, the people who were paying those high prices would be taxed on the fair market value of the houses they were buying.

But, we revalued everyone. That meant that there were lots and lots of people who found themselves living in homes that were getting more and more valuable. Their taxes were climbing faster than their incomes, faster than inflation, faster even than budgets.

Folks were finding it hard to keep their homes. Indivdual tax bills were being driven, not by the needs of towns, but the real estate market.

After a typical revaluation about two thirds of the people get huge tax increases but the remaining third were getting tax decreases! Clearly not everyone was paying their fair share.

And those decreases were going to primarily commercial owners whose property values weren’t rising as fast as the homeowners, so owners like Home Depot and Wal-Mart were getting large windfall reductions on the order of 15-25% while owners of the most modestly priced homes were getting increases of from 11-13%. These numbers are for North Kingstown after its last revaluation but are pretty typical. Not exactly a fair distribution, is it?

Any marketplace, no matter how well regulated, is at its core, a gamble. There is simply no justification for using marketplace gambling as a basis upon which to tax our citizens for the municipal services we receive.

Our website offers a different approach, another tool, to use in this battle against the most hated tax in America, the Property Tax.

Take a look and share your thoughts.

Click on RIGHT for the website.

Wednesday, June 7, 2006

Sex and Taxes


Property taxes are all over the news again, or more correctly, still. Everyone is trying to bring relief to the beleaguered property owner, as well they should. Our collective property taxes in Rhode Island are way too high.

The goal of the lawmaker is to receive credit for lowering those taxes while permitting towns to continue providing needed services. The one who does that will be hailed as a real hero and is assured a prominent place in the Legislators' Hall of Fame. It's 'sexy'.

Sad to say that the real answer is a very unsexy, practical, boring one. We need to make the distribution of property taxes fair before we make them lower. Any tax increase, no matter how small, will be unfair as long as there will be those who pay increases based on the increased market value of their property, which often is anything but small.

The market price of property is not unlike prices in any market, the stock market for example. It is what buyers are willing to pay and is simply a gamble. True, we expect the dice not to be loaded and the market value (assessment) to be honest and accurate. But why should gambling have anything to do with the taxes we pay simply to live in our communities?

Nothing. Not one thing.

But maybe that's just me.