Let's Talk Taxes

While at the polls on Election Day it was pointed out to me that I had given up my Republican credentials because I was supporting the two, “tax and spend liberal” candidates for the At-Large seats on City Council. It was the “tax and spend” comment, to which I have also been associated, that I would like to comment on.

I’ve never felt comfortable with the current party mantra of, “No New Taxes.” It’s a negative statement that provides no vision/direction or solutions to the problems we face. On the other hand I remembers the days (and some will say they are still here) when the only solution to a problem was to throw more tax dollars at it—with little result.

There are those who point to the fact that we have the lowest tax rate among cities in Virginia, and in the region, as justification for increasing taxes. This approach does not take into consideration that there are those in our community, regardless of the current tax rate, where any increase becomes a burden. It also does not recognize that the reasons for taxation are limited. Any consideration of raising taxes should be based on meeting needs, return on investment, and/or for stated goals that have community support.

I have come to the conclusion that the issue is not how much we are taxed but rather on what tax dollars are spent on and outcomes. People expect a certain level of service and understand the cost associated with them. And if the proper use of tax dollars result in positive outcomes that expenditure could translate not only in a better quality of life but could also result in increased revenues thereby reducing the need to raise taxes.

At the local level all taxes dollars collected go back into the community through services—water/sewer, trash pick-up, etc.; and infrastructure—schools, police stations, etc. These expenditures are focused on three core areas of service, public safety, public works and education. While we could discuss how dollars are spend in these areas no one would dispute that these are where our tax dollars should go.

During the last years budget discussions in the City I received more calls on the decision to stop providing trash bags than I did on the tax rate. I also received calls asking me not to raise taxes but to fully fund groups like the Regional Library. Here is where we must deal with the issue of needs vs. wants.

We must define needs and wants. We must make sure we first provide tax dollars for needed core services. Only then, and only with community support, do we consider the funding of wants. Last year there were many community organizations that provided programs and services but one had to question whether it was the role of government or the community itself to support them.

An example of investing tax dollars on outcomes can be found in how we deal with our transportation problems. Richmond seems ready to give local government more control in planning for our future transportation needs. This effort will require additional funding that will probably, at least in part, need to be raised locally.

If local governments are freed to plan and implement local road and other transportation related projects based on a set of outcomes such as congestion mitigation and reduced road trips, we not only improve our quality of life but also decreases the cost to business making them more profitable, and attracting compatible new business to the area thereby taking some of the tax burden off residents.

In the face of uncertain revenues, increased costs, reductions in state and federal funding and more unfunded mandates taking the position of “No New Taxes” flies in the face of reality. To be able to continue to provide a quality of life residents expect, and to take advantage of opportunities to invest in improvements that will in time take some of the tax burden off our residents, we must have all options on the table. Its not only about taxes its about priorities and outcomes.


P.S. --In response to Larry Gross' post regarding a breakdown of local spending I would refer readers to http://tinyurl.com/2mdtmn then click on City & County Spending and you can get this information. Thanks to Larry for providing this site on a previous post on my other site Question Everything.