Let us hope Denver City Councilwoman Marcia Johnson’s colleagues reject her suggestion to add yet another tax increase – the third or fourth, depending on how you figure it – to the November election ballot.
That kind of piling on top of embattled taxpayers could trigger voter rejection of the whole package.
City leaders already are planning a three-tiered request in November:
A 2.5 mill increase in the property tax to raise $27 million annually to maintain city infrastructure. This proposal is designed to end Denver’s bad habit of neglecting existing facilities, then asking voters every 10 years or so for a big bond issue to catch up on the repairs and maintenance it should have been doing all along.
A $340 million bond issue to, ah, well, basically to catch up on the repairs and maintenance the city should have been doing all along.
The package does include a few new items, like $20 million in permanent housing for the chronically homeless. But for the most part, this bond issue would replace or repair existing facilities like the police crime lab, streets or parks that have been neglected in the past.
The good news is that this bond issue can be funded without an increase in the mill levy, because of growth in the city’s assessed base. That is not a tax rate increase, but if you’re a Denver property owner, you will pay somewhat more if this issue passes than you would pay if it were defeated and your mill levy could be reduced slightly. For the owner of a home valued at $250,000, that cut would be about $50 a year.
The third proposal, like the first, is a tax increase by any definition. It contains 28 projects, totaling $290 million, that would be funded by a property tax hike of about $39 a year for a $250,000 property.
Unlike the first two packages, this proposal is likely to prove controversial. It includes $75 million to remodel Boettcher Concert Hall, built in 1978, and build new recreation centers and branch libraries. The question of adding new facilities is obviously less pressing than repairing and maintaining those we already have, so many taxpayers who favor the first two proposals are likely to vote against the third.
Just between us voters, we actually suspect that these optional spending proposals may have been bundled into a third package in the hope that giving fiscal conservatives an issue on which they can freely vote “no” may actually enhance the chances of the first two, more vital, proposals winning approval.
In contrast, Johnson’s notion of adding a fourth tax increase to the November ballot could put the entire infrastructure reform plan at risk.
Johnson on Monday proposed adding another $8 million annually in property taxes to hire staff to operate the new branch libraries, recreation centers and other facilities voters will be asked to approve.
She wants funding, up front, for facilities that you haven’t even agreed to build yet – and that would require a year or two in design and construction time even if voters did OK them.
Even in the unlikely event that the council’s laundry list of projects does pass voter scrutiny, it would be no great trick to come up with $8 million in future operating funds from the city’s budget. Allocating less than 1 percent of the city’s current general fund of $837.6 million would do nicely – and those revenues are expected to rise 5 percent or more next year.
Council members have already added $63 million of their own priorities to the third bond issue that a task force appointed by Mayor John Hickenlooper had recommended be limited to $227 million. Now, the council is putting the finishing touches on the whole infrastructure package before placing it on the November ballot.
Before the council gets greedy and asks voters for yet a fourth tax increase, it should remember the Wall Street maxim: “Bulls make money, bears make money, but pigs just get slaughtered.”
