Does Wexler "Feel Floridians' Pain" on Property Taxes?

Representative Robert Wexler, a Democratic member of Congress representing Florida, has been accused (by his challenger, not surprisingly) of being insensitive to Floridians' concerns over property taxes. His crime? He doesn't own a home in Florida. Here's one of his opponents:

"When he says he feels for you and understands your pain of high property
taxes, well, he may feel for you but he doesn't experience it as if it were him
paying," said former Broward Mayor Ben Graber, who is running for the 19th
Congressional District under no party affiliation.

And here's another challenger:

Republican Ed Lynch, of Royal Palm Beach, another Wexler challenger, said: "He can't truly represent the people if he doesn't know what it's like to be in the district. There's not much of an argument he can make to other members of Congress and state officials about property taxes if he isn't actually paying our property taxes."

Perhaps the most cogent response to this charge so far has been made by Wexler's chief of staff, who notes that Florida Governor Bill Crist (who has championed some pretty big property tax cuts so far in his tenure) isn't a Florida homeowner either.

A snippier, but probably more relevant response would be: what's Congress supposed to do to fix Florida's property tax mess? Florida property taxes (and sales taxes) are above average for one simple reason: lawmakers think the state is better off not imposing an income tax. Sensible observers routinely suggest smart tax reforms that could reduce the pain from Florida property taxes, and state lawmakers just as routinely ignore them. So somehow Congress is supposed to step in and fix this?

Lastly, if Wexler lives in Maryland instead of Florida (as the article suggests), it's pretty clear that he's no stranger to property taxes, as the Free State's property taxes are pretty high themselves.

Behind this inherently silly charge there is, I suppose, a more interesting question: does a lawmaker need to be like his/her constituents in order to effectively represent them? Just throwing this out there, but I bet people who would say "yes" to this question are exactly the same people for whom the concept of "tax justice" means no more and no less than "tax cuts for me." Put another way, the implicit assumption is that any lawmaker can only lobby effectively on behalf of himself and people like him-- an assumption that is laughable to anyone who believes that where you stand on fairness issues shouldn't depend on where you sit.

Property Tax Cuts Hurt Local Bond Ratings

Palm Beach County is, as counties go, quite well off. As Marketwatch notes,

Palm Beach County is one of the nation's wealthiest counties, with 2006 per capita personal income levels 51% higher than the Florida and national averages. In addition, the economic base is diverse, balancing tourism and technology manufacturing in the coastal areas with agriculture in the western portion of
the county.

Which makes it a little surprising that their credit stinks:

Fitch Ratings has assigned an 'AA+' rating to Palm Beach County...The Rating
Outlook is revised to Negative from Stable. The Outlook revision to Negative reflects Fitch's concern regarding anticipated erosion in the county's financial metrics over the next few fiscal years.

So why is such a well-to-do county seem as a credit risk?

Several factors are stressing the county's financial profile, including: statewide property tax reform measures which, coupled with the political unwillingness to increase the operating millage, will reduce ad-valorem revenue available to fund countywide operations in fiscal year (FY) 2009; a weakened economy and housing market; and rapidly escalating operating costs, most notably for sheriff operations.

So at a time when a housing market slump is knocking down the property tax base anyway, the state of Florida comes along and helpfully forces localities, including Palm Beach County, to cut their property taxes even further.

Over the past year, the main debate on the Florida property tax question has been whether state-mandated cuts in local property taxes would be affordable. And the usual suspects have lined up on either side of this question: business says yes, unions say no. But it matters, a lot, what bond rating agencies think. And they think, in this case, that the state's property tax cuts are going to hurt local governments. That's worth thinking about as Floridians consider this fall whether more property tax cuts would be merited.

Haridopoulos Convinces Dozens: Vote Against Amendment 5

State Senator Mike Haridopoulos (R-Indialantic) held what was supposed to be a public debate on the merits of the proposed property-tax-for-sales-tax swap today. But, as the Orlando Sentinel's blog recounts, it turned out to be a pretty one-sided debate, and a sparsely attended one at that.

In front of about a dozen attendees, Haridopolos repeatedly called Amendment 5 a “bait and switch” that would result in a net tax increase.

Anyone who's ever tried to hold a forum on tax issues knows the pain of nobody showing up. So, kudos to the Senator for trying. But if the poor attendance is disappointing, the lack of participation on the part of lawmakers supporting the swap is, well, very disappointing:

Haridopolis said he originally intended his series of 10 forums to be debates, but the amendment’s proponents have not attended any so far.

In a way, putting complicated tax matters on the ballot is a signal by lawmakers that they simply don't want an open and informed debate on tax issues. But everyone would be better off if the lawmakers who like the tax swap faced off publicly with those who don't.

Cutting Public Transit to the Bone

The Orlando Sentinel reports that Orange county will not be hiking gas taxes to fund public transit anytime soon.

The result: funding for the regional public transit system, Lynx, that will be flat as a pancake next year.

The county planned to give Lynx $37.8 million, the same as last year. Lynx CEO Linda Watson said the system needed $8 million more to avoid cuts to routes just as more people turn to buses to avoid rising gas prices. Lynx relies largely on support from Orlando and Orange, Osceola and Seminole counties for its $114 million budget.Orange County Mayor Rich Crotty and Commissioner Bill Segal patched together a plan that calls for giving Lynx $1 million in January if there are extra unspent funds left over in the budget, but only if the bus agency increases its fares. Lynx expects a 25-cent fare increase to raise about $1 million.

From which two quick observations can be made:
1) there's no free lunch. By refusing to consider a gas tax hike, lawmakers have basically passed the buck on to users of public transit, who tend to be poorer and who are already doing the right thing by not driving.
2) The "cut the fat" mantra that fuels anti-taxers has no place in the public transit world. More so than most other areas of government, the cost of public transit is driven by fuel prices. To insist on essentially flat funding for public transit at a time when fuel prices are skyrocketing is absurd.

The broader, interesting question (to which I don't have an answer) is this: what should the relationship be between gas taxes and public transit? Between user fees on public transit and the broader transportation infrastructure grid? The belief of Orange County leaders appears to be that we should have about as much public transit as can be paid for with bus fares, and no more. And I'm not sure that's a defensible position.

Local Responses to Property Tax Cuts

How are local governments responding to the state-mandated increase in Florida's property tax homestead exemption? The Miami Herald reports that in Dade County, about a quarter of the tax cut is being made up with higher property tax rates:

Miami-Dade Mayor Carlos Alvarez juggled the four county taxes that make up the total rate to reclaim $50 million from a $200 million shortfall that resulted from the double Homestead exemption passed by voters in January.

Dade County's actions aren't obviously right or wrong. What this points out, though, is just how difficult it can be to forecast the actual impact when state governments try to force local governments to cut taxes.

Which begs a broader good-government question: if Florida state lawmakers are so hell-bent on cutting taxes, why not just cut their own and leave local governments alone?

Getting Lean in Jacksonville

Those who believe government is too big have a tendency to scoff when (as has happened since the Florida property tax cuts were ratified by voters in January) advocates forecast fiscal doom and gloom. They argue that there's fat to be cut, and that imposing big tax cuts can force government officials to make the hard decisions about unnecessary spending.

An interesting article in the Jacksonville Times-Union makes a broader case, applicable to governments, corporations and plain 0ld citizens, that sometimes we need to have a gun to our head before we do what's smart. The city of Jacksonville is replacing the least-fuel-efficient motor vehicles in its fleet with gas-sipping hybrids. The good news is that this is having a measurable impact on the city's transportation budget:

The effort is shaving $3 million from the proposed fleet management budget in a year when statewide property tax reform and a sluggish economy are expected to cramp city finances.

The bad news is that the economy is relentlessly pushing these costs up in a way that cost savings just can't cover:

While city officials say fleet cutbacks have saved $3 million, the fleet department's proposed 2008-09 budget, $48.6 million, grew by $11 million.
Skipper said a 47 percent jump in the cost of fuel was mostly to
blame, but the budget would be closer to $51.6 million without the efficiencies.

In other words, fuel prices are imposing big new costs on local governments at a time when the mandate from the state is that locals must cut costs.

One more reason why this is not the best time to be holding a gun to local governments' head and demanding more efficiency.

So should the example of Jacksonville's saved $3 million be used as ammo by anti-tax advocates looking for examples of "government waste?"

Only if they're prepared to make the same admissions themselves. Private citizens and companies nationwide are responding to high gas prices in exactly the same way the city of Jacksonville has done, by driving less and buying more fuel-efficient cars. If these folks are willing to characterize their past purchases of gas-guzzling SUV's as "wasteful," then it's acceptable to describe Jacksonville's actions in the same way. But don't expect such an admission from most Floridians anytime soon...