[Vision2020] Property tax cut?

[John Dickinson]

Hi-

Property taxes fund schools, cities, and a few other places. About 2/3 goes
to schools and about 1/3 goes to the cities. The "property tax reflief"
being discussed is talking about the school portion and will likely leave
the cities portion untouched.

Reading the piece from Elliot Werk points out why most people distrust their
government. I am always disappointed when politicians give a public
description of their actions that hide the real self-serving motives. One of
the reasons I ran for city council a couple of years ago was to show people
that it was possible to run for an office, express a set of beliefs during a
campaign, and act on those beliefs in an ethical way throughout a term of
office. Our state and our country would be so much better served if a
majority of politicians acted in this manner.

Enjoy the summer heat.
John

 

-----Original Message-----
From: vision2020-bounces at moscow.com [mailto:vision2020-bounces at moscow.com]
On Behalf Of J Ford
Sent: Sunday, July 23, 2006 12:08 PM
To: vision2020 at moscow.com
Subject: Re: [Vision2020] Property tax cut?

 

How does this affect what Mayor Cheny wants to do?  Does this mean her 3% 

tax hike is out the window followed closely by her 9 new employees?

 

 

 

J  :]

 

 

 

 

 

>From: Ralph Nielsen <nielsen at uidaho.edu>

>To: Vision2020 at moscow.com

>Subject: [Vision2020] Property tax cut?

>Date: Sun, 23 Jul 2006 08:50:26 -0700

> 

> 

>ELLIOT WERK

> 

>IDAHO STATE SENATE

>Legislative News

>The Special Interest Session

>July 16,

>2006

>                                       Volume 1, Number 6

> 

> 

>In This Issue

>7    The Special Interest Session  Whats in it For You?

> 

>7    Town Hall Meeting on the Property Tax Plans  July 24th, 6:30 PM

>at Boise Public Library

> 

>Handy Web Links

>My Home Page

>Find out what is happening, what Ive been up to, or fill out my

>latest survey

>Legislative Web Page

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>legislators, and more

>Secretary of State  Elections Page

>Look at campaign sunshine reports, lobbyist registration, and more

>Absentee Ballot Request

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>Contact Me

>http://www.elliotwerk.org

>mailto:elliotwerk at mindspring.com

>Phone: 658-0388

>Legislative Messages: 332-1000

>Snail Mail:

>6810 Randolph Dr., Boise, ID 83709

>The Special Interest Session  Whats in it For You?

>By now many of you have heard talk of a special session of the

>legislature to provide a property tax cut. The Governor has asked

>legislators to hold Friday, August 25, 2006 open in case a special

>session is called.

> 

>Homeowners are rightfully asking for something to be done about

>rapidly escalating property taxes. So, if a special session of the

>legislature is called - whats in it for you  the homeowner?

> 

>To answer that question lets take a look at the tax cut proposal

>that the Governor has laid out (both in his inaugural speech and many

>times since). Then we can talk a bit about how the proposal affects

>homeowners, and then about how the special session will work. Lastly

>I will lay out the recently announced Democratic plan that provides

>100% of the property tax relief to homeowners without raising the

>sales tax.

> 

>The Governors Proposal - The proposal removes the school property

>tax levy (known as the M&O - $3 per $1,000 of property value) from

>all types of properties and shifts that cost (about $250 million) to

>the sales tax. This would result in a reduction of about 20% in

>property taxes for all classes of properties.

> 

>That sounds pretty good. Until you look at the details.

> 

>This proposal was rejected three times by the Senate in the last

>legislative session because it penalizes the people that are asking

>for the tax cut  the homeowners - while substantially weakening

>education funding. There is no tax relief for homeowners in this

>plan, just the mirage of relief.

> 

>Let me explain.

> 

>How the Proposal Affects Homeowners - Property taxes are calculated

>differently for residential property compared to all other types of

>property. While residential property taxes are based on full market

>value (what we can sell our house for on the market) other types of

>property (commercial, industrial, utility, and agricultural) are

>assessed based on income potential. This has led to a dramatic

>difference in property value increases over the last five years

>(really forever).

> 

>For instance, while agricultural land and utility property taxes have

>actually dropped almost 10% in the last five years, residential

>property taxes have increased by almost 92%.

> 

>So back to the Governors plan  according to Idaho Tax Commission

>figures - removing the M&O from all classes of property gives 60% or

>about $150 million of the tax cut to properties other than owner

>occupied homes (like your home that qualifies for the homeowner

>exemption). That leaves 40% of the cut for you and me.

> 

>So lets recap, properties that have remained relatively flat or even

>seen a decrease in their property taxes in the last five years will

>get 60% of the tax cut while properties that have seen a 92% increase

>in property taxes get 40%. Seems a bitunfair.

> 

>And it gets even worse. We, the homeowners, pick up the lions share

>of that $250 million cost since the proposal shifts the school levy

>from property to sales taxes and business is generally exempt from

>paying sales tax (remember all those tax exemptions). If business

>properties are paying part of the school levy today and we shift to a

>tax that they do not pay (and the costs stay the same) then

>homeowners pick up that extra burden. That is how a tax cut becomes a

>tax increase for you  the homeowner.

> 

>Another recap  60% of the tax cuts go to special interests that have

>seen no substantial property tax increases over the last five years

>and homeowners see an overall increase in our tax burden as we pick

>up the full cost for school funding.

> 

>But that is not all. Unfortunately theres more.

> 

>If you itemize deductions on your federal income taxes you can deduct

>your property taxes from your income. So in reality you pay your

>property taxes with 75 or 80 cent dollars (depending on your tax

>bracket). So not only will homeowners pay for a tax cut for special

>interests, but you also lose the deductibility of that portion of

>your tax burden!

> 

>That is why the Senate rejected this plan three times during the

>regular session  it raises taxes on the people that need the cuts

>the most  the homeowners. And it gives a juicy tax cut to property

>classes that have not seen substantial property tax increases!

> 

>If you dont believe me you can ask Senator Hal Bunderson  chairman

>of the Senate Local Government and Taxation committee (you can

>contact him at 888-7156). After weeks of study using Idaho Tax

>Commission figures he led the charge against this plan in the regular

>session and has spoken out repeatedly against it recently in the

>Idaho Statesman.

> 

>That is why I call the contemplated special legislative session a

>Special Interest session. It will provide tax relief only to the

>special interests  not the homeowner.

> 

>How Will the Special Interest Session Work?  As the Governor has

>laid it out, a proposal will be worked out behind closed doors. The

>Governor will line up support for the plan prior to calling the

>Special Interest session - guaranteeing that he has enough votes to

>assure a quick victory. The Special Interest session will be called

>on a Friday (August 25th) where the only proposal considered will be

>his plan. There will be no committee hearings, no public testimony,

>and no other plans considered.

> 

>The Democratic Plan  Property taxes on owner occupied homes have

>increased an average of 92% in the last five years. You need some

>relief. Our plan provides homeowners with 100% of the relief.

> 

> 

>The plan is simple  everyone that qualifies for the homeowner

>exemption is given an additional exemption from the school M&O levy.

>You get a 20% property tax cut and special interests get nothing. No

>shift, no complications. Just tax cuts where they are needed.

> 

>The cost of our plan is $104 million which can be absorbed by our

>ongoing surplus (we currently have a $200 million fund balance  of

>that about $100 million is likely ongoing revenue we can use to fund

>property tax relief).

> 

>Town Hall Meeting on the Property Tax Plans

> 

>The Ada County Democratic legislators will host a Town Hall Meeting

>at 6:30 PM on Monday, July 24th at the Boise Public Library. The

>purpose of the meeting is to have a public review of both property

>tax plans and provide the opportunity for the public to discuss and

>comment on the plans.

> 

>We are offering this opportunity to ensure that the public is well

>informed about the property tax plans and the ramifications of each

>plan.

> 

>I hope to see you all there. You might want to arrive early since

>space is limited and we expect a large crowd.

> 

>In closing I would ask you to contact your legislators to voice your

>opinion about property tax relief. Do you want to pay for a cut for

>the special interests or would you like targeted relief for

>homeowners. You can contact your legislator by name at http://

>www.legislature.idaho.gov/about/contactbyname.cfm or by district at

>http://www.legislature.idaho.gov/about/contactbydistrict.cfm. You can

>also contact the Governor (after all he is leading the charge) at

>either 334-2100 or via email at http://gov.idaho.gov/ourgov/

>contact.html.

> 

> 

> 

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