GRANOLAPARK: Whose money?


Dear Readers,

Hey, remember your money? That tax money the county returned to you?

Yeah, that tax-duplication rebate that went to Takoma Park six months ago. That money?

Maybe you don’t remember because it went bye-bye. The city council voted 7-2 to hold onto it because the recession was bad and Romney might win. We might need that money, best to wait.

But now, the waiting is over! Romney is defeated, and the recession isn’t as bad. That’s what council member Fred Schultz reminded his colleagues at the Nov.19th city council meeting. The were discussing, again, what to do with about $650,000 in tax duplication funds, and $750,000 the city manager was holding to pay down a bond loan. That adds up to $1.4 million.

On the level

Schultz, as he does, methodically stepped through his level-headed logic for the sake of the public and other council members. He said he supported holding onto the money in those anxious days in May, but now he doesn’t. He’d like to return it to you by reducing the tax rate this year.

Unfortunately, this may be a minority view.

Councilmembers Terry Seamens and Seth Grimes voted last May to return the money via tax-rate cut in May. They mentioned this, but, they also each had a list of things to spend it (or the other pot of money, or both, it wasn’t clear) on.

Seamens noted he was “originally” for returning the rebate to the taxpayers, but “since the council didn’t agree,” he’d prefer to use it to pay down debt on municipal bonds. Those are loans the city takes out to fund large building projects such as the new Public Works building. Seamens would also like to modernize the city library, bringing it up to date with digital publications.

Grimes also said he also originally favored returning the money to taxpayers, but he now favored paying down debt. That, he said, was a way of repaying taxpayers.

Er, hold on there, said council member Schultz. Actually, the reason the city uses long term financing in the form of bonds “is so we don’t have to use up all of our cash.” It’s the same reason people get 30 year, not 10 year, mortgages. Paying off a chunk of a loan would be pointless considering the “historically low interest rates,” the city has been able to get.

“My inclination” said Schultz of the $1.4 million “is to use some for programs, some to reduce the tax burden.”

Taxpaying in place

Councilmember Kay Daniels-Cohen, asked if there was a way to lower the tax-rate permanently. No, said acting city-manger Suzanne Ludlow, the council sets the tax rate each year.

Otherwise, Daniel-Cohen’s interests lay in funding the revitalization of Takoma Junction, a “teen-gardener” position, opening the city library on Sundays, and programs for seniors. She, Grimes, and council member Jarrett Smith were fired up by citizen effort for seniors they call “aging in place.” This appears to be a program to help senior citizens stay in their Takoma Park homes as they age.

It is ironic that instead of reducing the tax rate, these concilmembers would favor spending the rebate to fund a program to find out what seniors need to stay in the city. As council member Schultz pointed out (again, Mr. Level-Head) retired people on fixed-incomes, such as himself,  are faced with increasing property tax assessments and therefore higher taxes every year. “I’ve lived here a long time and it’s depressing, the assessed value goes up,” said Schultz.

Councilmember Tim Male was not in attendance, and Mayor Bruce Williams didn’t express a strong opinion about what to do with the money, though he predicted a future in which the county turns the city’s tax-duplication arguments “on their heads,” and institutes a new punishing tax system on us.

The Big Issue

Tax duplication has been Takoma Park’s big issue for decades. The county takes city resident’s property tax money and keeps it for county services. But, the city provides some of the SAME services, so the county by rights should turn over that portion of the tax money. They turn over some, but not enough, so the city has to include those costs in its own taxes. SO, residents end up paying twice. Citizens and their representatives have been ranting about this since at least the 80s. Studies have been done, negotiations entered into. And, this is the first time the city has had such a rebate.

The council discussion will continue in January, Dear Readers.

Until then, you can wonder if you’ll ever see your money again. Don’t wonder too hard. As Fred Schultz said, the council “will never find a shortage of ideas to spend this on.”

– Gilbert

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About the Author

Gilbert is the pseudonym of a hard-bitten, hard-drinking, long-time Takoma Park resident who maintains the granolapark blog. Gilbert and William L. Brown — Granola Park's mild-mannered chief of staff, researcher, and drink pourer — have never been seen in the same place at the same time.

4 Comments on "GRANOLAPARK: Whose money?"

  1. If there is to be any rebate to city residents, it should be means tested, so that those who are wealthy do not get cash back they don’t really need. That is what was wrong with Grimes’s and Seamans’s original (extremely rushed) proposal: it would have given the bulk of money to those who pay the most in property taxes, i.e., those in the most expensive houses, who are mostly rich.

  2. The rebate is the return of money that shouldn’t have been collected in the first place. It should go back to the people it came from, not redistributed to others. That would be like returning something to a store for a refund and the store gives you half what you paid and say the rest goes to charity.

  3. Steve Davies | December 7, 2012 at 4:54 pm |

    Means testing, in addition to not being feasible for Takoma Park to carry out, likely would not hold up in court, either

    The owners of the apt complexes also would be due something and I doubt they’d take redistribution lying down (and they’d probably be joined by a few of those “rich” homeowners)

  4. M on Sligo Creek Parkway | May 29, 2013 at 4:23 pm |

    Coming in late to the discussion because I just learned about this blog while looking for opposition to the Safe Grow legislation. Indeed, Takoma Park seems to penalize people for owning their own homes and somehow sees justice in deciding who has too much money, so therefore, should be forced to give it away. A tax rebate should reflect what the taxpayer pays–not based on income. On that same note, if ability to pay is criteria, it is the high taxes that are forcing our senior out. Nope. If there is a tax rebate (something I pray fervently for), taxpayers should get what they paid in to support duplicate services, regardless of their income level. As well, putting it toward paying down debt accrued by stupid decisions made by City Council is unfair. There is only one thing worse than a neoconservative–a neoliberal. In the end, they look alike–both pushing ridiculous agendas supported by small but vocal activists. And those of us seeking balance almost always pay the price.

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