With the month of May coming, it time for flowers to bloom and for our school district to trim resources. Every year when this happens I appreciate the flowers and figure there has to be a better way to fund our schools. Below is the text of a letter I send to Representative Insko with copy to County Commissioner Alice Gordon. There has to be a better approach that what we have now. Thoughts and comments are appreciated.
Dear Representative Insko,
We have had some correspondence over the years on school funding. For your constituents who live in the Chapel Hill Carrboro School District, who care about education, and who understand that a vibrant, successful and, therefore, well-funded school system is a cornerstone in the foundation of our community, May is always a depressing month. May is the month every year where we confront the impending budget short fall, fret over the choices of which resources our children will lose next year, watch our children’s teachers and mentors worry about whether they will still be employed in August, and will line up to speak to Commission Gordon (on copy) and her colleagues imploring them to raise taxes, particularly the special district tax. The Commissioners sort through this the best they can but only have the blunt instrument of regressive taxation to address the funding short falls.
It’s like watching the same movie year after year with no hope of a better outcome. On the bright side, this situation is easy to fix. If legislation were passed in Raleigh which allowed a special district tax to be progressive instead of regressive the Commissioners could sort this out in short order. I have not gone through the math (but would be happy to do so if it would help in drafting a proposal) but this example should serve to illustrate the point. You set the special district tax such that on the first amount of property value e.g. $100,000 the tax rate is lower than it is today, perhaps zero. On the property value above the threshold, the tax rate is set higher than today. The legislation should be arranged to allow for the possibility of reduced taxation for seniors and farms. With this simple change, the taxation burden would be shifted to people who can better afford it like me and the schools could start adding resources rather than reducing them.
I am convinced that if we continue as we are our beloved school district will wither and lose its reputation for excellences and its place in the foundation of our community. I don’t believe than any of us, parents, teachers, students, or local officials want this to be legacy of our time as stewards of the Chapel Hill Carrboro School District. So representative Insko, I ask you to consider introducing legislation to give the Commissioners this type of taxation latitude. If you are successful, it will be an accomplishment that makes you proud as you what the district grow and flourish. If you have doubts about whether there is support for the initiative I suggest you ask Commissioner Gordon to recount her experiences over the years at the June meetings when school funding comes up. If you need any assistance on this initiative please let me know I and can raise up an army of fellow parents who would support this.
Best regards,
Jeff Danner
Issues:
Comments
It would appear that you
It would appear that you have proposed this taxation idea before? What has been the the response of elected officals? One footnote I believe the deadline has passed for new bills to be introduced at the General Assembly.
Legislative Deadlines
I had some correspondence with Representative Insko's staff about 3 years ago with some interest expressed. The problem is, as you point out, I tend to only remember to try to address in April/May which is generally too late for the legislative calendar for the year. This a long term problem, though so if it's too late for this session I hope it gets some consideration in the next.
Bubble Burst
I hate to burst your bubble but it is already progressive, The higher the value of your house the more tax you pay. Also with revaluation it seems the higher the value of your house the higher percentage of valuation growth so higher valued house face this almost exponential growth every 5 years while lower value than average houses actually pay less after revaluation with a revenue neutral adjustment. If that isn't progressive than I don't know what is. The system relies 88% on property tax and this percentage is growing. We need a comprehensive plan that generates revenue from many sources (ie real estate transfer, sales tax, income tax, school usage fees, combined with low income adjustments for fixed income, managed commercial growth and most importantly reduced property tax). It doesn't cost anymore to educate higher valued houses children than lower valued houses children so why should higher valued house valued pay so much more of the revenue share with this ridiculous monumental valuation adjustments on higher valued houses every 5 years. This plan should be presented to voters in a comprehensive package that educates that property tax will go down with the addition of these new sources of revenue and revenue generation will be shared more evenly by all. The problem is new growth revenues do not cover new services provided so we need new methods to grow revenues so causes of growth pay appropriate share of new services needed.
Progressive v. Regressive Taxation
Regressive taxation is when you pay the same amount on the entire valuation of the item being taxed. In the case of property taxes, you pay the same tax on the first and last dollar of the home value. The equivalent regressive tax in income taxes would be a flat tax. Progressive taxation, like our current national income tax, applies increasing percentage as the amount being taxed grows. Orange County's current system of property taxation follows the regressive model.My bubble remains safely intact.
In fairness, it's North
In fairness, it's North Carolina's system of property taxation, not Orange County's. State law mandates that ad valorem property taxes work in one particular way and no other. Also, there is the Homestead Exemption for lower income senior citizens, so NC's property tax system is not a pure flat tax.
Understood
Mark,Thanks for the clarification. I know the change would be required to be addressed in Raleigh, hence the entreaty to Verla. Also, I though that there might be more potential for adjustments in a special district tax compared to a county-wide ad valorem property tax.
Property Taxation (hope this didn't post twice)
Apologize for burst comment and causing this thread to morph into
definitions rather than addressing the problem. The proposal does not
resolve the problem Orange County has with way to much reliance on
property tax and the huge and growing burden placed on over average
valuations. The proposal only places more burden on a population (higher
than average valued properties) that is already extremely overburdened.
For example it does nothing to help out middle class retiress thay have
worked all there lives for their houses but may be faced with losing
when shifting to a fixed income that cannot cover the extreme growth in
property taxes mainly cause by revaluation. Again it seems like a system
that utilizes other sources of tax revenue combined with LOWER property
taxes and lower reliance on property taxes might be the way to go.
Now if you are only talking about the district tax then the proposal might be something to think about.
Note: the current rules to help seniors only applies to an extremely
small population and does nothing to help middle class retirees faced
with huge property tax bills. To get any help now you pretty much have
to be so income deficient that you probably can't afford to own a house
in Orange county anyway. Of course if your rich you can smoke your way
into an agricultural tax break.
nice picture showing the concept
here's a picture that shows % of your income paid by each income bracket in various taxes in NC -- http://www.itepnet.org/wp2009/nc_whopays_factsheet.pdfYou can see how % goes up for income taxes and down for sales. Property taxes are fairly flat. Overall burden is regressive in NC
Per pupil expenditures and learning
According to the National Science Foundation, "No direct correlation can be made between spending and academic performance. Several states that ranked in the lower two quartiles of this indicator ranked in the upper quartiles of the National Assessment of Educational Progress indicators."http://www.nsf.gov/statistics/seind10/c8/c8s1o11.htmMaybe instead of bankrupting the county by continually asking for more money, the school board should simply use their SAPFO rights and tell the elected officials that the schools are full and cannot handle any new development.
Limits
Terri,Based on previous interactions I would not expect us to come to agreement on this one. However, I would suggest that the "no direct correlation" at some point must have limits. I don't particularly want to continue to run the experiment of finding out out many resources you need to remove until you see an impact. I do take issue with "continually asking for more money". With the cost of inflation and other mandated expenses, the district does ask for more money each year, but your sentence makes and inferrence which is not consistent with my experience with the schools.In the 9 years my chidren have been in the district the resources have consistently declined. Fewer teachers, reduced world language teachers, lack of textbooks. I never imagined that my children would go to school and there would not be enough math textbooks for them to bring one home at night to assist in their studies.This is not the direction that I want my school district to go. The suggestion to Representative Insko above would address this problem by relying on resources which would come from those most able to provide them.
Inflation?
Jeff,The inflation rate for 2010 was 1.5% so I don't really think that's much of a problem. I supported you in your campaign for the school board because you ran on a platform of data-driven decision making. What percentage of the budget goes for administration vs classroom expenses? What process/data are used to evaluate special programs and determine which to continue and which to cut? There are a lot of ways to look at budgets and assuming that more is always needed doesn't benefit anyone. The CHCCS has gotten used to a much larger per pupil expenditure than other districts in NC have. So clearly the residents have Chapel Hill/Carrboro have made a commitment to education. But there have to be limits. Continually escalating budgets are unsustainable. At some point, we have to say there are other priorities within the county that need resources too and the schools will simply have to adapt.
SAPFO report
Here's the annual report on SAPFO. With all the new schools built over the past 5 years, it looks like we're not overcapacity for middle and high schools in either district, but the elementary schools in CHCCS are over capacity. So my comment above was more true 5 years ago than it is today. http://www.co.orange.nc.us/planning/documents/ReportDraftClean032911.pdf
It costs taxpayers
a million dollars per soldier. We know where our tax money is actually going.