Taxes, like death, might be inevitable, but it doesn’t mean we have to take either one lying down.
For this editorial, we’ll leave the issue of a dignified death to the palliative care experts. Property taxes in Flagstaff, though, are fair game, especially now that the city council seems set on raising them 7 percent this year and another 7 percent the next.
When we last visited this subject a month ago, City Manager Josh Copley was making the case for a catchup in forgone tax increases of 2 percent a year dating back five years. State law allowed the increases as a way to keep up with inflation, but the previous council majority had taken a pass. Cumulatively, that has either cost the city $1.7 million in revenues or saved property owners a similar amount, depending on your point of view.
Copley, who spent much of his career in the police department before moving into city administration, wants the extra taxes to go toward public safety – six new positions apiece in police and fire. They are part of 31 new positions and a 10 percent growth in General Fund spending.
We suggested that the fire department could benefit from an outside audit of any overlap between its medical responses and Guardian ambulance calls before committing to what amounts to an extra firefighter at each station.
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And in a projected General Fund with 10 percent more revenues ($7 million) than this year, we urged the council to look first at funding the public safety expansion from funds other than new property taxes. In a city with already high housing costs, anything that adds to that burden deserves extra scrutiny.
But five weeks later, the tax hike for 12 more public safety jobs appears to be a done deal with very few, if any, questions asked by the council. In fact, Councilman Charlie Odegaard was so taken with the tax recapture that he wanted it placed into a dedicated fund just for police and fire – a plan others rejected, pointing out that all departments should have an equal claim to primary property tax revenues.
The state-mandated Truth in Taxation Hearing set for June 20 at Flag High is a pro forma event – a solid council majority has already decided to move forward with the tax plan and the budget as soon as the last person has their say. And truth be told, the financial impact of even a full 14 percent hike by the end of fiscal 2019 is not that much: $34 more on a $300,000 house two years from now than today.
That just shows how much primary property taxes have shrunk as a percentage of overall municipal revenues and, by comparison, how much sales taxes have grown. But because half or more of the latter are paid by non-residents, it’s not a bad thing that sales taxes are where most revenue growth has occurred, especially from discretionary spending in restaurants, bars and hotels.
It might be that Flagstaff really needs a two-year, 14 percent hike in the property tax levy. But the council also could phase the increase in over five years and still find enough money to honor its public safety commitments.