An Echo Press Editorial: In defense of tax increases...
OK, the headline for this editorial is a little misleading.
Nobody — including the newspaper's editorial board — believes that local governments should go around year after year, raising taxes willy-nilly on businesses and families that are already struggling to make ends meet.
But a modest, carefully planned and thought-out levy increase does make sense.
The alternative — a zero tax increase or a reduction — would be a welcome relief for taxpayers.
But as tempting as that may sound, the relief would be only temporarily. Meanwhile, costs will inevitably go up for building materials, road construction supplies, labor contracts, heat, electricity, gas, insurance and a myriad of other expenses that local governments must cover.
Yes, they can tighten their budget belts and come up with cost-savings ideas. But it's not as easy it sounds. No matter how much cost-cutting is done, there are still things to do — streets to maintain, new roads to build, public employees to pay, vehicles to replace, facilities to upgrade, property to take care of, debt to pay off and other obligations that go into providing basic public services.
If a county, a city or a school district could somehow bring those increasing expenses down to zero, the strategy would ultimately backfire by pushing higher costs into the future. Consider a street project. If Alexandria decided to stop paving a street, using the savings to help freeze taxes, it wouldn't take long for the street to deteriorate to such a poor condition that it would need to completely reconstructed at a much higher cost than regular paving would total.
That's why it's prudent for local governments to always keep an eye toward the future, realizing that the money they spend today can save taxpayer dollars down the road. The Alexandria City Council has made moderate levy and budget increases a financial priority, knowing that maintaining a pattern of 3 to 5 percent increases in the levy every year is much more desirable than having a zero percent increase for a couple of years followed by a whopping increases of 15 or 20 percent to make up all the ground that was lost.
Another point to consider that should ease at least some of the sting people feel for having to pay those tax increases: Our area stacks up pretty well against other communities that don't have the kind of tax base that we enjoy. City Administrator Marty Schultz noted this at Monday's Truth In Taxation hearing before the council approved its budget and tax levy for 2019:
• The average city tax on a $150,000 home in Alexandria is $630 (2016 figures). In other regional centers of comparable size in the state, the average tax is $872.
• Alexandria's tax rate of 42.01 percent is the fourth lowest of those comparison cities, which had an average tax rate of 58.53 percent.
• The total tax rate in our area, including all the taxing entities — Douglas County, School District 206, Housing and Redevelopment Authority, and the Alexandria Area Economic Development Commission — is 115.94 percent, the seventh lowest of the 23 comparison cities, which had a tax rate of 129.28 percent.
• Alexandria's 2019 tax levy increase of 4.12 percent is significantly lower than the 6.2 percent average of the 23 comparison cities.
Three people from the public spoke at Monday's Truth-In-Taxation hearing. They asked good questions, took the time to get involved in the process and shared their concerns. More residents should follow their lead. It sure is better than just grumbling to yourself about high taxes.