consultants are sandburs

Thursday, July 17, 2014

Blaine does roads. The old fashioned way. 4F. Free from franchise fees.

Eric Hagen, ABC Newspapers reporting, July 16, 2014, here. This excerpt, (and there's a photo showing a road comparable to some in Ramsey).

ABC photo credit - click to enlarge and view
The Blaine City Council July 10, over the course of four votes, approved street renovation projects and a bond sale to pay for these projects in the short-term before funds are available to cover all costs.

[...] To have the funds for the city’s pavement management program for projects like this, the council also approved the sale of $3,245,000 of general obligation bonds. The interest rate will be 1.88 percent.

“It’s darn near free money,” Councilmember Russ Herbst said.

Finance Director Joe Huss originally anticipated the principal amount of the bond sale would be $3,420,000 and the interest rate would be 1.91 percent, but the nine bids the city received came in favorably. The city received a AA-plus bond rating from Standard & Poor’s, which is the second-highest rating a city can receive.

Mayor Tom Ryan said they are entering the fifth year of the pavement management program that seeks to have a more defined schedule and budget on road projects and an emphasis on keeping up with maintenance needs – such as sealcoating and overlays – before more expensive reconstructions are needed. The council approved bids for these lower-cost maintenance projects in other areas of the city earlier this year.

That is bond for the capital, service the debt from general funds [levy funds]. For the lower cost stuff, just budget general [levy] funds. No retrogressive taxation. Just, the old fashioned way.

I believe it was Jim Bendtsen who was the most vocal [indeed the only speaking] citizen at the last council franchise fee public hearing, with Bendtsen strongly arguing that general funds raised by the levy should be used for fundamental, expected municipal expenses subsumed in the very nature of operating a town and providing expected, anticipated, needed public goods.

Not rocket science. Not disfavored assessment. General funds. Bonding where you have to, meaning state statutory levels of assessment might be required, but no turning to franchise fees.

For another untraditional approach [avoidance of using general funds for general needs], other ideas exist. They may not be perfect ideas, or may need enabling legislation to see usage, but what's wrong with the old fashioned way?

That being -- Those more able, as reflected in having higher value property in the town, pay proportionately more, but with a flat levy rate and not a graduated scale where the marginal extra half million or million in property, whatever, is taxed at a higher rate. That IS another way to run city taxation. Our better off citizens should not forget or ignore it. Once getting them thinking that way, they may be more amenable to plain old general fund ways and means. More favorable to those having less, but not unfavorable to the plutocrats as far as a graduated property tax would be, (or having an excise tax attaching on say any single family home over a half-million in assessed valuation).

The old saying is there are many ways to skin a cat; (and likely it's cats alone that most dislike that expression). Get to skinning plutocrats ...

2 comments:

Randy Backous said...

First, we aren't Blaine. We have a $10 million budget and we'd have a much easier time fitting roads into the budget had the boys that Anonymous supported not blown all our resources on their friend's pipe dream of manipulating the free market. We finally got out from under the Landform contract on July 1, 2014 and if the original deal - which Anonymous’ friends crafted - had been allowed to stand, we'd still have 42 more months to go. Anonymous talks a good game like so many others in his cult, but they created the problem to begin with - along with the HRA which they created essentially to tax citizens to funnel money to Landform. Anonymous got up and made his appearances on TV but in the end, he still supported his fellow cult members. Anonymous can beat his chest all he wants but most of us know he’s part of the problem. “I pledge allegiance to the Party…” Us REAL conservatives recognize and reject their hypocrisy (see November 2012 election results).

Second, we’ve discussed transit taxing districts. A concept that’s intriguing to me as long as it's applied city-wide based on type of use (not imposed narrowly or differently by area) and we remove the road line items from the general levy. I like it because we could impose a higher fee on large commercial trucks that do most of the damage. It has many down sides though like everything else. That’s a discussion that will have to wait because we've done so much talking it's time to fix the roads. For now we’ll have to tweak the assessment shadow tax that Anonymous likes so much.

eric zaetsch said...

Thanks, Randy. Complications in Ramsey deserve being pointed out, and now is as good a time as any. With your not seeking another term on council I cannot see anyone justifiably criticizing your thoughts as politically motivated, that way.