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Wednesday, October 29, 2014

Easy Call: Vote "No" On Janesville's Tax Increase Referendum

Janeville's city council continued their derailment on the so-called "street repair" referendum during their last council meeting before the election when they proposed and passed a policy statement that essentially changes ...absolutely ...nothing.

All they are doing now is grasping at straws to change the reality of their failure to "lock in" binding language the first time they voted to approve the referendum. Their policy statement does nothing more than repeat commonly held perceptions of accounting practices the public expects regarding the supervision and dispensation of our tax dollars.

Also, the "lock in" narrative might be a good sound bite for a Gazette headline, but to informed Janesville voters it becomes little more than a sleight-of-hand exercise to divert attention away from the council's clumsy but intentional misdirection.

Another point overlooked in this entire episode is the city council is asking voters to make the decision for a tax increase the council refused to tackle or solve on their own with the wheel tax. Politics in play? You bet!

There are two major reasons why Janesville voters should vote "No" on this referendum. The first is obvious. The referendum question asks voters to increase the tax levy for the next fiscal year (2015) city budget by roughly 4%. Working backwards, this results in a levy of $30,912,286 which happens to be a $1.2M increase over the previous year. That's all there is to it.

As presented in my original posting exposing the city's referendum gaffe, it contains NO "binding" language about streets or maintenance, nor does it imply the money will be in addition to the previous amount allocated for street repairs. It's simply a tax hike referendum to increase the city's levied budget by $1.2M each year for the next five years.

The second reason to oppose this referendum comes only IF assuming its purpose is indeed for street repairs. Because if it is, it intentionally spreads the tax burden among a smaller Janesville tax base, property parcels, as opposed to registered vehicles.

What that does is it puts a bigger hit on property owners ($37 average annually) than it does on Janesville vehicle owners ($10 = $535K, approx. $22 annually) to raise the requested $1.2M. Secondly, by placing it on property tax bills, it arbitrarily charges home owners for the wear and damage done to streets by vehicles. As it stands, property taxpayers are already paying a portion of road repairs but so do vehicle owners. However, a reasonable balance test should levy more onto the primary cost "causer" for existing road repairs. In this case, vehicles.

On the public awareness side, going to the property tax instead of a local vehicle tax also buries the cost for street repair into the inherently murky clutter of the property tax bill. The fee becomes out of sight, out of mind. If voters should approve this referendum, Janesville's street repair "wheel" tax bill (or I39/90 expansion fee, depending on your view) will be equivalent to about $47 annually, with no guarantee it will be used for street repairs. (The current wheel tax is $10)

By keeping the "street repair" fee out of plain sight, there are several obvious advantages for city government, but no good reasons why citizens should go along with the lack of transparency. If the referendum fails, don't worry. The sky will not fall nor will the streets roll up like an unlocked window shade. My guess is the council will come back with another stab at a referendum in spring 2015.

Like it or not, the apolitical and practical way to pay for street repairs in this era of triple-taxation-zero-sum economics, is with a local vehicle or wheel tax apportioned to the type and weight of the vehicle the same way the state charges for annual plate registration. This way, the vehicles responsible for placing the most wear and tear on our streets pay accordingly. For instance, this fee scale could begin with an amount of $10 for passenger cars and progressively climb to $40 for the heaviest trucks and buses.

Unfortunately, the well-informed voter knows there is little chance of that fee structure becoming law with all the special interests controlling the local agenda, and with other rate hikes and taxes being shifted onto the typical wage earner, I'm not sure Janesville's residents can afford any of this.

Without even touching on the central role or adverse effects Forward Janesville's legislative agenda had in reducing state aid to local and rural roads, I recommend a "NO" vote on the City of Janesville Question 1 referendum.

Read more on the Janesville referendum:

RNR - (Oct. 2, 2014) Roads Point To Janesville Politics In Tax Hike Referendum

RNR - (Sept. 23, 2014) Newspaper Misinforms On Referendum While Telling Readers To Get Informed

RNR - (Aug. 26, 2014) Janesville City Council Ignores Citizen's Referendums

RNR - (June 28, 2014) Wisconsin Rural/City Roads Are Crumbling For The I39/90 Expansion

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