Today’s Globe has a must-read article on the dozens of upcoming Prop. 2-1/2 override votes whose sole purpose is to crank up local property taxes because local governments have no other way to pay for schools, teachers, and cops.
Across the state, the [Prop. 2-1/2] limit puts into focus two deeply contradictory themes: the steadily increasing demands of local governments to pay for services, and the weariness of property owners fed up with their taxes, which averaged $4,007 for a single-family home in the current fiscal year.
Last year, voters rejected 59 of 89 override proposals, marking the lowest approval rate statewide since 1999. The average override attempt was about $630,000 last year. This year, the average request is $1.9 million among the 25 towns that have scheduled votes; a similar number of towns are considering votes but have not formally decided. The average request does not include overrides used to pay off debt, formally called debt exclusions, which are as high as $20 million.
The math is pretty simple, and pretty scary.
“Proposition 2 1/2 is failing us,” Joseph Denneen, chairman of the Walpole Board of Selectmen, had said earlier in the day. “The increase that is allowed by Proposition 2 1/2 does not even cover the increases in medical insurance premiums for our employees. So right away, before you’re even talking about funding a contract or giving someone a raise or buying a new pickup truck, you’re in the hole.”
The ideas put on the table by Governor Patrick seem to me to be important steps in the right direction.
As governor, [Patrick] has proposed allowing communities to assess a $1 or $2 tax on meals and hotels; eliminating the exemption on property taxes enjoyed by telecommunications companies for their poles and wires on city streets; opening up the state Group Insurance Commission to local government employees; and changing the way pensions funds are invested and administered. For taxpayers, Patrick wants to expand a property tax credit for low-income seniors to include homeowners of any age.
Patrick has proposed a $312 million local aid increase, about 5 percent over this fiscal year. “We’ve increased local aid, but not to the amount we would have liked,” said Lieutenant Governor Timothy P. Murray . “We are working on a series of short-term efforts to get more money to the cities and towns.”
On controlling health care costs, if anything the Governor’s proposal doesn’t go far enough (its requirement for union sign-off on transferring responsibility for health care benefits to the state-level Group Insurance Commission seems likely only to prevent the transfers from happening).
The Globe article reports that override votes are failing more often than they are succeeding (59 of 89 votes failed last year). So there are obviously only so many times local governments can go to that well. Yet, as we all know, there doesn’t appear to be much appetite in the legislature for the local option taxes, and there was apparently even resistance to the no-brainer idea of taking over underperforming local pension systems. And God forbid the lege should look to closing business tax loopholes to generate some new revenue. Nor does it look like the lege has any interest in doing much for the locals on Chapter 70 school aid.
So let’s review. Governor Patrick: try to avoid overrides by giving locals more non-property-tax revenue options, and by helping them reduce costs via buying into the state health insurance program and taking over underperforming pensions. Also, give lower-income property owners some relief. And let’s look to loopholes in the business tax laws as an additional revenue source to avoid drawing down the rainy day fund while helping the locals take pressure off the property tax.
Lege: Uh, we got nothin’. Good luck, guys.