FEBRUARY 28, 2000

THERE ARE ALWAYS TWO SIDES TO EVERY STORY.

AFTER READING YESTERDAY’S STATESMAN JOURNAL, I AM COMPELLED TO TELL YOU THE OTHER SIDE OF THIS STORY.

IF THEIR FRONT PAGE ARTICLE WEREN’T BAD ENOUGH, THE EDITORIAL REALLY SUMMARIZES THEIR SIDE OF THE ISSUE WELL: “NOBODY LIKES TO RAISE TAXES OR IMPOSE FEES, ESPECIALLY DURING AN ELECTION YEAR. BUT THAT WILL BE A KEY PART OF BRIDGING A FINANCIAL GAP THAT’S ESTIMATED AT $50 MILLION DURING THE NEXT FIVE YEARS.”

THE TAXING RECOMMENDATIONS INCLUDE:

-A BUSINESS LICENSE TAX TO RAISE $1.65 MILLION A

YEAR

-A 5 PERCENT ENTERTAINMENT/ADMISSIONS TAX

THAT COULD RAISE $1 MILLION A YEAR

-A 1 PERCENT RESTAURANT MEALS TAX THAT COULD

RAISE $1 MILLION A YEAR

WHO WOULD PAY THESE TAXES? PREDOMINATELY BUSINESSES AND PEOPLE ALREADY PAYING THE BULK OF TAXES IN SALEM.

AND, THEY’D PAY MORE WITHOUT THEIR CONSENT!

OH, THE STATESMAN JOURNAL GOES ON TO SAY THERE IS A THIRD IDEA – “GOING TO VOTERS FOR APROVAL OF A CITY INCOME TAX” BUT, THEY ARE QUICK TO ADD, IT “SEEMS IMPLAUSIBLE AT THIS POINT.”

WHY IS IT IMPLAUSIBLE? THEY DON’T SAY. IN FACT, THERE IS NO OTHER MENTION OF THIS ALTERNATIVE ANYWHERE IN THE ARTICLE. PERHAPS BECAUSE PEOPLE WOULD NOT PASS A TAX ON THEMSELVES!?

JOURNALISM. AIN’T IT GREAT!! I HAD TO READ THIS ARTICLE MORE THAN ONCE TO UNDERSTAND WHAT THE FACTS ARE.

THE HEADLINE WAS WORDED VERY CAREFULLY: ‘SALEM CITY COUNCIL MULLS THE NEXT STEP TO CLOSING WHAT COULD BECOME A $50 MILLION REVENUE GAP.”

“SALEM OPERATES FOR $479 A HEAD.” THE CITY’S PER CAPITA TAX BURDEN FOR DAY-TO-DAY OPERATIONS. THIS WOULD IMPLY THAT’S WHAT EVERYONE INDIVIDUALLY HIM OR HERSELF PAYS INTO THE CITY.

THE CITY MANAGER SAYS THE CITY INVESTS A LOT OF TIME IN FORCASTING 5, 10 AND EVEN 20 YEARS INTO THE FUTURE. WOULDN’T A REASONABLE PERSON ASK, “WHY THEN AREN’T THEY PREPARED FOR THIS REVENUE SHORTFALL?”

OR, MORE TO THE POINT, “WHY IS THERE ANY SHORTFALL AT ALL?”

THE CITY MANAGER BLAMES THE PROBLEM ON THE LOSS OF FEDERAL FUNDS SINCE THE 70’S, PROPERTY TAX CUTS IN THE 90’S (MEASURE 50), AND THAT 15% OF PROPERTY VALUE IN SALEM IS EXEMPT – IT IS STATE OWNED PROPERTY THAT COULD BRING IN $6 MILLION A YEAR.

WE’VE HAD ALMOST 30 YEARS TO DEAL WITH THE LOSS OF FEDERAL FUNDS. IT WAS CLEARLY TAXPAYERS WHO WANTED TAX REDUCTIONS IN THE EARLY, MID-90’S. WE NEED TO DEAL WITH IT AND UNDERSTAND THE MESSAGE! STATE OWNED PROPERTY HAS NEVER BEEN TAXED. THIS IS MONEY THAT’S NEVER, EVER BEEN AVAILABLE – GET OVER IT!

THE ARTICLE FOCUSED LARGELY ON THE COST OF EMPLOYEES. PERSONNEL COSTS ARE 65% OF THE BUDGET. THE ARGUMENT IS THAT THIS IS TYPICAL FOR GOVERNMENT. GOVERNMENT IS MOSTLY A SERVICE. AND CHARTS ARE USED TO SUPPORT THESE SALARIES AND BENEFITS. WHEN COMPARING SALARIES AND BENEFITS, AND COMING UP WITH AVERAGES, SOMEONE HAS TO BE ON THE BOTTOM, JUST AS SOMEONE WILL BE AT THE TOP ON COMPARISON CHARTS. UNFORTUNATELY, THESE COMPARISON CHARTS ARE AN ENDLESS CIRCLE. ONE GOVERNMENT COMPLAINS ABOUT BEING BELOW AVERAGE, SO THEY HIKE THEIR EMPLOYEES’ PAY, WHICH INCREASES THE AVERAGE. THE RESULT IS THAT SOMEONE ELSE ENDS UP FALLING BELOW THE AVERAGE ON THE CHART. AND, OF COURSE, THEY, TOO, WANT AN INCREASE. THEY CAN’T BE BELOW THE AVERAGE!

MORE CONFUSING AND DISTURBING TO ME IS WHO SALEM IS COMPARED TO IN THIS ARTICLE. TOP EXECUTIVES ARE COMAPRED WITH EUGENE, GRESHAM AND CORVALLIS IN OREGON. BUT THEY ARE ALSO COMPARED TO VANCOUVER, BELLEVUE AND EVERTT, WASHINGTON. IT APPEARS THE STUDY COMPARES COMMUNITIES OF SIMILAR POPULATION AND SIMILAR NUMBER OF SWORN POLICE OFFICERS. BUT IT’S DIFFICULT TO TELL WHAT ELSE IS TRULY SIMILAR.

WHAT ABOUT THE COST OF LIVING? WHAT ABOUT EMPLOYMENT? LOCAL, AND IN THE CASE OF OTHER STATES, STATE TAXES? WE MUST BE SURE WE ARE COMPARING APPLES TO APPLES. THIS COMPARES PEARS AND ORANGES.

WE SHOULD BE LESS INTERESTED IN HOW WE COMPARE ON THESE CHARTS, WHICH ARE DIFFICULT TO VALIDATE FOR ACCURACY, AND MORE CONCERNED WITH THE TAX BURDEN ON THE TAX PAYER.

BUT THAT RAISES THE QUESTION ELECTED OFFICIALS SHOULD BE ANSWERING: WHAT IS THE GOAL?

-PROTECT THE TAXPAYER OR PROTECT THE BUREAUCY?

-REDUCE GOVERNMENT, OR

-PROTECT SERVICES, PROTECT EMPLOYEES, PROTECT EMPLOYEE SALARIES AND BENEFITS - AT ALL COSTS TO THE TAXPAYER?

-IS GOVERNMENT COSTING TOO MUCH RELATIVE TO THE TAXPAYER ABILITY TO PAY?

-IS GOVERNMENT COSTING TOO MUCH RELATIVE TO WHAT THE TAXPAYER WANTS TO PAY?

WE NEED TO ASK OUR ELECTED OFFICIALS WHAT THEIR BASIC PREMISE OF GOVERNMENT IS? TO PROTECT THE GOVERNMENT OR PROTECT THE TAXPAYER?

VOTERS WILL PROBABLY GET A BETTER UNDERSTANDING OF WHAT CANDIDATES AND CURRENT ELECTED OFFICIALS WILL DO AT BUDGET TIME, IF THEY KNOW THAT BASIC PREMISE IS.

AT WHAT POINT DO WE SAY ENOUGH IS ENOUGH. THE COST OF GOVERNMENT IS THE BIGGEST COST TO MANY TAXPAYERS OF ALL THEIR EXPENSES. -- IS THE AMOUNT YOU PAY TO RUN GOVERNMENT (YOUR INDIVIDUAL TAX BITE) MORE THAN IT COST TO PAY FOR HOUSING, FOOD, MEDICAL EXPENSES, AND SCHOOLING FOR YOUR CHILDREN? CAN YOU AFFORD TO SAVE FOR YOUR RETIREMENT?

WHEN DO WE DECIDE IT’S TOO MUCH? AND WHAT IS THE BENEFIT OF GOVERNMENT COSTING SO MUCH? OR, WHAT IS THE TRUE COST TO SOCIETY WHEN GOVERNMENT TAKES SO MUCH OF A TAXPAYER’S EARNINGS?

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