A Taxing Session…

For the past few years, Councilmembers have leaned forward to pat themselves on the back for not increasing the City’s property tax assessment. The maximum allowable increase is 2% ($500,000) each year; foregoing the increase saved the average citizen about $2.25…not enough for a hot fudge sundae at Dairy Queen, but a savings, nevertheless!

 

taxesCuriously, Councilmembers also pat themselves on the back when they report City sales tax collections have increased since the depths of the recession (even though they can point to no action they took to prompt this recovery.) Who do they think is paying these higher sales taxes?

 

Some of the sales tax recovery is due to tourists returning to visit and spend, but the greatest portion of the higher tax receipts are assessments on Scottsdale citizens. Once citizens regained their financial footing and returned to auto showrooms, department stores and dining out, the City got in line to collect 1.65% sales tax on these long-deferred purchases. If the price of goods and services or rents had increased because of inflation, the city stood to collect even more tax dollars.

 

Consider this: Sales tax collections next year, for the General Fund alone, will be about $16 million higher than six years ago. Assuming $4 million (25% perhaps) is generously contributed by tourists, citizens spending in Scottsdale will pay the other $12 million. That’s about $53.25 per citizen.

 

Drowned out by the sounds of all the back slapping, we might miss the irony of these two statements. Council relieved each of us of a $2.25 increase that might have been put on our property tax bill. But by keeping the sales tax rate the same, they automatically assessed each of us $53.25 more in sales tax dollars than we paid six years ago. No Councilmember ever suggested we reduce the sales tax rate!

 

Selective communication of lower taxes is not transparent; it may be a popular political boast, but it is a misleading communication to citizens. As citizens, if we knew we were actually paying a lot more in taxes than we did six years ago, we would wonder, “What are we getting for all that extra money?” Hours at our libraries are shorter. Fees for bridge at our senior centers are higher. Maintenance of our City assets has been deferred. Contributions to our Capital Fund are a fraction of what they once were.

 

We do know a few things our extra taxes paid for: The City now has a new compensation policy that guarantees “newly hired” city employees will always be paid 5% above other valley cities. The City expanded WestWorld to seven acres, under roof (air-conditioned!) and now pays millions for electricity and debt service while the facility sits cool and empty most of the time. The City spends millions of dollars for public safety in the Entertainment District each weekend night. The list goes on!

 

You should expect your Council will give you a proper accounting of your taxes – what dollars they have collected from you and how they have spent those dollars for your benefit. I am experienced doing that; I am committed to do that! I encourage you to join my campaign and ask for your vote on August 26.