Tax realities

Many of the things I learned within the halls of ivy, so long ago, turned out to be true after all, even though, for some intervening time, they seemed to be more theory than fact, more principle than practice. Case in point: the idea that the cost of local government services would always be more than residential service-consumers could or would be willing to pay out of their personal budgets, and that therefore, they would demand to be subsidized by non-residential taxpayers which would predictably pay much more in taxes than they drew out in services. We labeled these two sides of the tax-and-spend equation tax-minuses for the residential category and tax-plusses for the non-residential and we learned, in Urban Planning 101that there was an immutable law-of-the-universe guiding local governments to keep residential property taxes below a percent or so of fair-market-value lest the home-owner natives become restless and decide to rebel in fairly unpleasant-to-government ways. And yes, there may be an exception which proves the rule. Indeed, when Californias Proposition 13 appeared on the political scene there in 1978, it was drafted specifically to set property taxes at 1 percent of property value, as shown by the most recent arms-length sale, although it said nothing specific about ensuring that an adequate taxable value of tax-plusses be recruited so that the tax-minuses could be suitably subsidized for their desires to spend more than they personally were willing to pay. That sort of planners foresight had emerged in earlier decades, not back in the late 19th century when Ebenezer Howard and during the Great Depression, Frank Lloyd Wright were theorizing about garden cities and broad-acre cities which today would be pejoratively labeled sprawl, but in the post-WWII decades when Columbia, MD and Reston VA were laid out as new cities and their designers and developers went to great lengths to try to balance the tax plusses and minuses through planning and zoning. As Reston and Columbia actually developed, however, they became commuter suburbs different only in architecture and not in financial structure from, say, Scarsdale, N.Y., or Brookline Mass., overwhelmingly residential with resulting high tax bills as a result. The present residents dont object: those who might have are long gone. Like those fairly typical suburbs, this entire state is now embarked upon a great and unique experiment to see how much of their own demands for government services a suburban-minded electorate might be willing to pay themselves, as they create the political pressure not merely to abstain from recruiting tax-plusses in pursuit of a traditional sort of fiscal balance but to actively discourage their presence. The list of specifics is too long to recite in full here: it ranges from C&S Grocers and Omya to Standard Register and perhaps even Vermont Yankee, all tax-plusses which have already voted, or in the V.Y. case may soon vote, with their feet to depart a governmental jurisdiction noticeably hostile to the Urban Planning 101 doctrine prescribing the balancing of the plusses and the minuses so as to create that usually-politically-demanded 1 percent tax rate. Judging solely from the ease with which new spending is contemplated and budgets are drawn latest free-wheeling spend-it-faster notion is the idea of taxpayer subsidy for an under-patronized cross-state bus route at the latitude of Rutland an observer must conclude that Vermont has morphed, over recent decades, into a political entity with majority mindsets about spending. Taxing in a development-prevention environment which refute the generally-accepted wisdom once articulated in Urban Planning 101, and that, just as in the inner-ring suburbs of Scarsdale and Brookline, the resident voting populations have self-cleansed to the point that the great majority of those who have not fled, now largely approve and are willing to put their money where their mouth is. Tax rates double and in a few cases even triple the once-normative 1 percent, while no significant Im-mad-as-hell-and-Im-not-going-to-take-it-any-more has yet surfaced. Honest Abe had almost the exact words for such a situation a century and a half ago: whether a governmental entity so conceived and so dedicated the Great Experiment, using a George Washington phrase can long endure, survive, and prevail. It will be interesting to watch. Former Vermonter Martin Harris lives in Tennessee.

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