Mayor John Dickert makes the case for a sales tax increase.Mayor John Dickert is saying publicly he supports increasing the local sales tax.
Political suicide? Maybe not.
Dickert said he backs Gov. Jim Doyle's plan to use a sales tax to pay for regional transit, including buses and commuter rail, because it could save property owners money. Here's the rationale:
1. Money collected from a sales tax could pay for city buses, offsetting the city's $1.5 million contribution to the Belle Urban System. (The $1.5 million number comes from City Administrator Tom Friedel, who pulled it from the 2009 city budget.)
2. Eliminating $1.5 million from the city budget would reduce the property tax about 24 cents per $1,000 - or roughly $24 on a $100,000 home. (The 24-cent number comes from the city's finance department.)
3. Of course, the property tax relief would come at the expense of a sales tax increase. But you'd have to spend $4,800 on taxable items to reach $240 in increased taxes. In other words, simply pulling the buses out of the city budget would save property owners money.
4. A sales tax for the RTA would generate enough money to improve regional transit - a change from the annual cuts to local bus service. Dickert said he wants to see Racine buses going to Kenosha, Caledonia, Union Grove and South Milwaukee. On the west end of the county, he'd like to see Milwaukee buses connecting Burlington. "We need a true regional system," Dickert said. "We need to stop talking about as borders we can't cross."
5. A sales tax is spread over a wider base than property taxes, which are paid by a select group of area residents. Everyone buys things subject to sales tax.
All that said, Dickert acknowledged it could be a difficult sell throughout the county. Democrats Cory Mason and John Lehman have both come out against a sales tax, and KRM commuter rail backers are still leaning on a rental car tax to pay for the train service through Racine County.
But Dickert said a sales tax would provide the framework to create a transit system that would attract businesses to southeastern Wisconsin and connect workers in Racine to jobs throughout the area.
"That's my push," he said, adding he'd work with Lehman, Mason, County Executive Bill McReynolds, and others to pursue the sales tax. "Our biggest failure will be if the train and regional transit system are not put into effect. We will set ourselves back if we don't do something."
Hmmm...it will be interesting to see if Caledonia officials support a sales tax increase. In Caledonia, we budget about $30,000 annually for bus system - because no one uses the buses.
ReplyDeleteLet's see, $30,000 savings spread out over about 10,000 homes - yeah, that's some real property tax savings!
And if anyone really believes that 1.5 million in the city will be returned to the taxpayers, I really do have some swampland you'd be interested in.
Good points ... maybe Caledonia's tax relief includes money for roads? May not work otherwise.
ReplyDeleteI asked Dickert specifically about your last point. Can the city guarantee the money goes to property tax relief? He said, in a word, yes.
Whether that will happen is debatable.
John before you purposed this did you talk to your advisors?
ReplyDeleteWhat if a the sales tax also included funding for parks and horse trails in Caledonia?
ReplyDeleteOh, I forgot public safety too.
ReplyDeleteWhat is the current debt on the city's tifs that are implemented? It's probably an ungodly amount.
ReplyDeleteJohn eliminating 1.5 mil from the budget by adding a sales tax! Lets get rid of unneeded employees like Brian O'Connell and the vacant land that he bought with our tax dollars.
ReplyDelete$0.24 off the mil rate is $24 annually on a $100,000 home.
ReplyDeleteCaledonia -
ReplyDeleteWe get it. You have lots of money and don't want to spend it to help anyone.
Man, I hope he enjoys his 2 year term as mayor. Quite possibly the worst in Racine's history.
ReplyDeleteI prefer to pay more property tax because it provides a much better deduction on the 1040! Moving from property tax to sales tax effectively sends more money to Washington DC.
ReplyDeleteanon 11:33 - want to start a revolution in Caledonia? A sales tax for horse trails would do it from one segment of the population, a sales tax for parks (without horse trails) would do it from the other segment of the population....and I'm thinking our elected officials are well aware of that.
ReplyDeleteDustin, thanks for checking. No matter how much the Mayor "claims", "promises" or "guarantees" that money would be returned, I've had this debate before with county board officials when a sales tax was being debated at the county level. All it takes is the vote of a subsequent elected body to overturn any legislation, well-intended or not, that would provide property tax relief via funding from a sales tax.
anon 6:18 - have you been paying attention? Caledonia's been struggling with budget deficits from the last 3-4 years and is going to continue to struggle because, despite the "wealthy community" moniker, we don't have sufficient taxbase to maintain our current level of services.
ReplyDeleteJust so you understand, Caledonia doesn't need an expansive bus system, because for the most part, there's nothing here to warrant it. If our village was to grow and develop, particularly from a commercial/retail standpoint and bring in some jobs, additional bus service might make sense.
Should we ask city residents to pay taxes to increase our greenspace?
Finally somebody with some courage. Get the bus system off the property taxes. If you change it out for sales tax, then renters are now chipping into the system. Placing the entire burden on homeowners is crazy.
ReplyDeleteLet renters and visitors to the area pay a portion. Our sales tax rate will still be really low compared to surrounding areas (especially IL).
This is a no brainer.
I am glad that Mayor Dickert wants lower property taxes. As mayor, he can do that when he prepares the next budget. I can suggest many services that we could do without.
ReplyDeleteHere's a crazy idea, why don't the people that ride the bus/transit pay for the bus/transit in fee's. Why do the rest of the world have to pay for their transportation? I don't see the goverment helping me make my car payment, why do we all have to pay for their (Car) rides?
ReplyDeleteNO! Sales tax increase NO!
ReplyDeleteNo KRM NO!
This is a fight you do not want. Try to if you like you will then be a mini term Mayor
Pete and Dustin - I think you could have picked a better picture of Dickert - it looks like he is laughing at Racine at the thought of a new sales tax - was that your intention?
ReplyDeleteCut property taxes, give real assessments in today's market.Which we all know if you could sell your house it would be for half the assessed value.
ReplyDeleteIf we cannot afford buses. Why the heck should we even entertain the idea of a public subsidized train?
There is no point going to Chicago or Milwaukee faster. They need to bring in businesses too. We need to work on some manufacturing jobs. I see too many grown men on front porches all day long.
8:17
ReplyDeleteIts because our masters have told The Mayor to bring them a train.
I gave the Mayor a chance to see what he would guess I know now.
Anon 7:02, Just a comment - renters already pay property taxes. It's figured into the price of their rent.
ReplyDelete..."We need a true regional system," Dickert said. "We need to stop talking about as borders we can't cross."
ReplyDeleteI wonder if this applies to local governments in general. Maybe we should do away with City Councils & Village Boards and make SE Wis just one big municipality, larger than the county(s).
Would somebody please let out of town visitors help pay our bills. The bus shouldn't be on the property taxes.
ReplyDeleteUgh ... 24-cents is $24 off a home valued at $100,000. The number is adjusted in the story. Apologies for the lousy math. Thanks for the commenter pointing out the mistake.
ReplyDeleteIOW, if you purchase a car for $15,000 your additional sales tax under Dickert's proposal will be $75.00 or 3 times what you (might) see in savings on property taxes if you own a $100,000 home?
ReplyDeleteUnless you're buying cars and houses everyday, you'd hardly notice the difference.
ReplyDeleteYes, unusual purchases of high dollar amounts would result in higher tax. The $75 example assumes a 0.5% additional sales tax. I have heard a 0.25% number out there also. That would cut the $75 to $37.50.
The key is offsetting property tax. It won't be a wash in all cases, but it wouldn't be dramatically different either (unless you have regular big ticket item purchases).
Fuzzy math. Dickert's, not Dustin's.
ReplyDelete11:44
ReplyDeleteHell if that's the case let's tax soda say .10 a can $1.00 a six pack
raise parking by .25 a hour a fee for having satellite dishes a wheel tax. God knows Racine could use the money.
More Sister Cities and trips to visit them, join more business groups and of course go to meetings, after all our job is to shut up and pay our taxes. The Mayor's job is to find ways to get more of our money.
Hell if that's the case let's tax soda say .10 a can $1.00 a six pack raise parking by .25 a hour a fee for having satellite dishes a wheel tax
ReplyDeleteYikes don't give them any ideas. Between the city, RUSD, Madison and Washington, they're already looking to take every last dollar we have.
Here's a novel idea: Let's put a special sales tax on bus or train tickets to pay for the bus or train.
ReplyDeleteOf course, we could always raise the fare to cover the costs, but democrats seem enamored with taxes, so I thought they might prefer this approach.
At least it doesn't result in the rest of us paying more for things we don't use.
Funny. They never mention the tax increases when running for office.
ReplyDeleteIs that the ten year plan? Tax Tax tax?
ReplyDeleteIs there anything in the plan to eliminate waste and corruption?
ReplyDeleteTypical liberal Democrat: Dickert.
ReplyDeleteMaybe next time we can get it right. Can we get a real conservative to run?
ReplyDeleteHow many rides per year does the current system provide. dived it by 1.5 Million and increase the fare by that much or round up to the nearest nickle.
ReplyDeleteThen Dickert can CUT our property taxes by $24.00 per year..improve the bus system and let us NOT raise our Sales tax. The Racine City and County can continue to be the Low Tax magnet in SE Wisconsin. Of course we have lot's of other spending and cutting that need to be done. but here's a Start!
anon 11:33 - you don't need to have a single big purchase item to quickly be in the spending category past $10,000 on an annual basis. Add up your every day purchases sometime - you'd be surprised how quickly they mount.
ReplyDeleteAnd if that sales tax increase isn't sufficient at .5%, what's next? An even further increase, or do we add sales tax to even more of our essential spending?
Some other posters have the idea - let those who use the service pay for it either via increased fares or a special tax on the cost of train/bus ticket.
Downtown
ReplyDeleteYou said we should continue to be a low tax magnet.
Well, if we've been a low tax magnet, then where are all the companies and jobs that conservatives promise?
Just more proof that tax policy doesn't solve every problem. We need a new direction and investment.
I want all of these riders pay for it people sign up for toll booths on every corner so they can pay for the roads.
Caledonia
ReplyDeleteYou do realize that groceries and other items are not taxed.
$10,000 a year is almost $1,000 a month on taxable purchses.
2:13
ReplyDeleteGet new talking points. Use some of the money that Transit Now has and get better writers please.
You do have something to fear. A more conservative media outlet is coming to tell Racine what The Mayor and the other power brokers do not want you to know.
2:20
ReplyDeleteI see, you only want pay per service if it helps your weak argument but you won't apply it to anything else? OK, you didn't like toll booths for riders to pay for roads they use.....how about paying for police only when you call them? How about making garbage pick-up optional and you only pay when you want it removed
Trains, highways, bus system is all part of internal transit infrastructure. You can exempt highways and roads from your argument because you happen to like them.
You should be aware there has been a push by some state organizations to remove the sales tax exemptions on EVERYTHING...including groceries. My point being, when a .5% sales tax increase does not sufficiently fund transit, you will see either that sales tax increase, or things like groceries being taxed.
ReplyDeleteYou will pay more ultimately to fund transit, just the vehicle name by which you pay will change.
anon 2:13 - we already pay in excess of .50/gallon in taxes for the roads. Unfortunately, thieves like Jim Doyle have raided the transportation fund, depleting the amount set aside for roads.
ReplyDeleteI was told by many to give the Mayor a chance that he was more a business man then a Democrat. He was also a leader someone who could think out of the box.
ReplyDeleteThinking I could give him a chance I had hope what I was told was true.
I do not know how much more of The Mayor being a typical Democrat I can take. From being told one thing was going on to finding anther from staff. Doing ground breaking work to have hard core Dickert backers steal the idea soon I believe there will be no more time to give him.
Please for the love of God no more taxes
All of the Dickert supporters were flat out fooled. When these shenanigans stop in 2 years, I certainly hope they vote with their heads and not their foolish hearts.
ReplyDeleteAnon 2:13 apparently does not understand the concept of cynicism. In small words, so you can understand it Anon, Racine is NOT a low tax magnet. Here’s a sample of cynicism: I love living in Racine because of the low crime rate, outstanding school system, extremely low taxes and unusually business-friendly city council. Oh, and let’s not forget the great mayor we have and his promise during his campaign NOT to raise taxes and NOT to hire a city administrator because the city can’t afford it.
ReplyDeleteWhat the hell is wrong with these clowns! Stop the damn taxing and spending. Attact business that will create jobs so people can afford to pay your little tax increased. For people out of work right now, litterally every penny matters.
ReplyDeleteTypical Democratic move. Raise taxes to lower taxes. Hmmmmmmmm.
ReplyDeleteWe have pared the budget to the bone but inflation and other factors still persist. Get real folks if you want to improve things it will cost. so suck it up and shut up. The mayor is right. We need this and it will cost. deal with it you cowards
ReplyDeletehow do you lower taxes?? STOP THE SPENDING !!! NO_NO more spending for useless projects. $50K For art ? $63k for playground. Buying houses for how much ?? Fancy street lights.Stop spending for things we don't need NOW !!!
ReplyDelete11:25 - don't be so cheap!
ReplyDeletehas anybody done a ridership study lately? It seems to me all I see going down the road are empty busses.Exception to the rule is when kids are going to and comming from school,which our taxes already are paying for.
ReplyDelete