Politics from the Palouse to Puget Sound

Tuesday, June 27, 2006

"Officials: Local taxes maxed out"

Michelle Dupler had another great article in Saturday's Moscow-Pullman Daily News. Michelle has done just a fantastic job of covering the local budget crisis.

Ruling against initiative means little room for area taxing entities

The possible demise of Washington state’s 1 percent cap on annual property tax increases offers little hope to cash-strapped governments and tax districts in Whitman County.

Most cities and tax districts in the county already are maxed out on property taxes, said Whitman County Assessor Joe Reynolds.

State laws limit property taxes to a cumulative total of $5.90 per $1,000 of valuation. With taxes from the county, cities, and junior tax districts that support cemeteries, rural fire departments and libraries all in the mix, there’s little room to maneuver, Reynolds said.

He rattled off a list of towns — Lamont, Tekoa, Rosalia, Pullman, Oakesdale, Malden, LaCrosse, Farmington, Albion, Garfield — all of which are bumping up against statutory limits on property taxes. The only way to increase their property tax revenues is to see new construction added to the tax rolls, or significant growth in property values. Both of those things are happening in Whitman County, but rising costs for things like fuel and health insurance for government employees are outpacing growth.

It’s a problem local governments have faced since a spate of voter-approved initiatives cut off state money. When the city of Pullman stopped getting money from the motor vehicle excise tax in 1999 — an estimated loss of $1.3 million per year — it had to raise property taxes to the maximum to keep the city afloat, said City Supervisor John Sherman.

In those days, the City Council could approve up to a 6 percent increase per year, with a supermajority vote of its members. Initiative 747 came along in 2001 and reduced that cap to 1 percent.

A King County judge ruled the voter-approved initiative unconstitutional June 13, setting off a flurry of discussions about the possibility of a new initiative by Eyman that kept the 1 percent cap in place. Gov. Chris Gregoire suggested the Legislature look at a compromise — something between 1 percent and 6 percent that would allow government more cash flow without putting too much of a burden on taxpayers.

It’s a delicate balance to strike, said Mike Bagott, fire chief for Whitman County Rural Fire District 4.

Bagott’s department, staffed by volunteers, covers 150 square miles of eastern Whitman County, including the city of Palouse and surrounding farmland.

His department operates on a budget of about $63,000 per year, money derived from property taxes. That pays for fuel, equipment, gear for firefighters and paramedics, utilities, maintenance and repair of vehicles, and insurance, Bagott said. Costs are rising, but revenue is not. That forces his department to choose its priorities.

He’d like to buy more fire hose to fight wildfires around Palouse. Wildfires are a constant threat during the region’s dry summers.

A farmer in Palouse lost an acre of wheat in August because of a spark from a tractor. The fire could have threatened the entire town if it weren’t for the quick response of Bagott’s department.

The money for more fire hose isn’t there.

“At the end of the day, we’d love to have more money,” Bagott said. “But especially considering the economy around here, you can only go so far before it becomes burdensome.”

He tries to offer taxpayers in his district a trade off. More money spent on the fire department means better fire protection. Better fire protection means better fire insurance rates for homeowners. Taxpayers save money.

“That’s the pay off,” he said.
Isn't it ironic? Whitman County was the only county to sue over I-747, and now that it has been overturned, we aren't going to see much benefit from it.

Let's go over that one more time shall we: THE ONLY WAY TO INCREASE PROPERTY TAX REVENUES IS TO SEE NEW CONSTRUCTION ADDED TO THE TAX ROLLS, OR SIGNIFICANT GROWTH IN PROPERTY VALUES. Got that PARDners? What's YOUR solution? More idle daydreaming? Target? Costco? Heck, why not Harrod's or Bloomingdales?

WE NEED REAL SOLUTIONS NOW!!!!!!!!Based on information from the Whitman County Assessor's Office, Wal-Mart would pay $328,000 a year in property taxes, not to mention nearly $650,000 in sales taxes to Whitman County and Pullman. Money we could use for schools, fire equipment and infrastructure improvements throughout the county, not just Pullman.

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