Wednesday, April 08, 2015

The Devil In Looney’s Details

If the Devil really is in the details – and He is – it becomes necessary for governing bodies who want to put one over on the general public to hide Him effectively from small “d” democrats. That is why ostensibly democratic governments require a veil of secrecy – to hide the Devil. Democracies do this most effectively by burying the Devil in mountains of misleading data. The general public, busy with other things, rarely notices the horned and hoofed demon until he comes knocking at their own doors.

Senate President Martin Looney’s new “tax reform” provides a case in point.

Under the slogan of “tax reform,” Mr. Looney proposes to shift to state coffers a portion of property taxes, levies imposed and used by municipalities to finance town government. SB1, introduced by Mr. Looney, establishes “a regional tax base sharing initiative through which multiple neighboring municipalities, or municipalities within a designated region, could share in new property tax revenues resulting from future economic development.” The monies are to be deposited in some sort of  state “lockbox” and deployed back to towns to mitigate the adverse effects of regressive property taxes. Mr. Looney proposes to use the additional state taxes to finance worthy regional projects.

Several questions arise: What is the state’s track record in using dedicated funds to finance the projects to which the funds have been dedicated? An honest Devil would reply: The record suggests that “lockboxes” are easily picked by cash starved governors and legislators; and the notion of a dedicated fund is, at least here in the tax-and-spend state, a term of art. The state’s gas tax was supposed to have been dedicated to road and bridge upkeep. A number of bridges in Connecticut have now been deemed much in need of repair, and a very large, $300 billion, thirty year project has just been proposed by Governor Dannel Malloy to bring Connecticut’s transportation network up to snuff.

Small “d” democrats in Connecticut may be forgiven for snickering whenever lockboxes are proposed by legislators who have in the past raided the lockboxes and dumped the stolen loot into Connecticut’s General Fund, but the Looney lockbox is more than peculiar. It appears to be a clumsy attempt on the part of legislative tax-and-spend progressives to establish a fund that may be used in the near future to finance yet another layer of tax-and-spend government. Watered by the fund, perhaps, in the not too distant future, history may be reversed and town government may be replaced by a resurrected County Government.

The remnants of County Government in Connecticut -- established in 1666, about 32 years after the formation of state and local governments -- were formally abolished by Public Act 152 during the 1959 legislative session, by which time the effective authority of County Government had been whittled away to one function: the upkeep of jails.  When County Government was in its prime during its 294-year history, it was responsible, among other things, for building bridges over waterways connecting towns, constructing and maintaining county roads and supervising bicycle paths. These are responsibilities that, over a long period of time, had been assumed by the state. Operational revenue used to finance County Government was generated through multiple resources, including a county tax for towns falling within the county's jurisdiction, payments from towns for jail inmates, and a share in the state's unincorporated business tax.

The Looney measure, which dials back the clock  more than fifty years, should be thought of as an attempt to resurrect County Government financing without the bother of reestablishing a County Government structure that would in time replace municipal government itself; this is the hidden Devil in Mr. Looney’s details.

As money leeches from municipalities to the state, towns either will increase property taxes or spending cuts. Mr. Looney and other progressives want to tap into property taxes because, to quote Office of Policy Management chief Ben Barnes in a different context, “That’s where the money is.” Mr. Barnes lifted the quote from bank robber "Willie the Actor" or "Slick Willie" Sutton who, asked why he robbed banks, replied “because that’s where the money is.” recently ranked Connecticut's average real estate tax bill at $3,301 the sixth-highest in the country.

Progressives in the General Assembly do not like the property tax because municipal governments actually cut spending when town budgets begin to bleed red. State government, much less responsibly, has been in the habit of addressing budget overspending through tax increases, borrowing money and raiding dedicated funds immured in “lockboxes” that, according to a dictionary of political terms provided by Connecticut Commentary “can be opened with a bent hairpin.”
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