John:
I agree that a taxing district tends to think only of itself and
ignore the effect of other coterminous taxing districts. Where I live, we
have 4 districts - the city, county, schools and abulance. But other people
in the city can have up to six depending on where they live and if they are
part of a cemetary, irrigation etc. district.
But I do not agree that a tax is "any funds which go from private to
public/semi-public orgs". There are several reasons for this. First is
that these services that are paid for by fees could be done by private
organizations as well as public ones. For example, in Boise, you do not
have city water or sewer service. Istead these are provided by private
companies. You do have to use these services if you live in these areas
since they have obtained a franchise from the city to provide these services
(and it would bu much more expensive to duplicate these sevices). In Idaho
Falls, the city provides the service. The advantage is that in the city we
have a fixed geographic base and can achieve econonmies of scale that
private providers outside the city cannot. Also, we do not have to pay
shareholders or investors so we can deliver services at cost. Another way
of looking at it is that the city residents become the shareholders of the
company and, instead of paying dividends, we give lower rates.
Second, you may not be aware that, by law, the proceeds of a
city-owned enterprise may not be used for public purposes but must be used
only for payment of the operations of that enterprise. The only exception
is that the city may charge a franchise fee to the city-owned enterprise in
the same way it would charge a fee to a private company. The purpose of
this fee is to compensate the city for the use of city rights-of-way or
facilities. Also, by law, the city may not use property taxes to fund the
operations of an enterprise fund. It is as though there were a wall between
these two kinds of operations. (An exception to this is that a city may
issue G.O. bonds to finance infrastructure such as building the Idaho Falls
hydroelectric plants, but this is not operations but capital investment.)
- Brad
>Yes, I used "use-tax" as you described it. A payment for a specific
>service (as apposed to general collection of funds by a governmental
>entity and re-distribution of those funds to other gov/service entities).
>
>Had the city/county the option to impose other types of taxes, or choosen
>allocate property taxes to the specific purpose of garbage, sewer, water, etc,
>then there would not be specific additional fees for those services. I think
>Fire departments have their own taxing districts, as do road/highway districts,
>and cemetaries(sp?).
>
>If you abstract it away a bit, then any funds which go from private to
>public/semi-public orgs are taxes and should be viewed as such. Looking
>only at property taxes, and the re-allocation of them to services is only
>a part of the picture (even locally). The rural towns are "taxed" in order
>to obtain law enforcement coverage from the umbrella county organization
>(even tho the residents of the city have already paid for law enforcement
>from that same organization through other channels).
>
>Licences are in the bag too, I think. The personal property tax for your
>car is in your "licence" fee (as well as a $2.00 admin fee to support the
>collecting of the licence fee).
>
>One problem, as I see it, is that citizens are requuired to pay taxes/fees/etc.
>to a wide variety of organizations, while the organizations only have a view
>of their own turf. The county is rather insensitive to the fire tax, but
>very in tune to the property tax, as an example.
>
>johnt
>
Associate Professor
Dept. of Ag. Economics & Rural Soc.
University of Idaho
Moscow, ID 83843
http://www.uidaho.edu/~scooke/onepercent
208-885-7170 (phone)
208-885-5759 (fax)