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June 30, 2005

Understanding Arlington County's Political Economy

A recent book, The New New Left: How American Politics Works Today, by Steven Malanga of the Manhattan Institute may help Arlington taxpayers understand why since 2000, per capita income has risen 19.1%, but the tax payment on the average residence has increased 94%. The consequence is that Arlington's bloated government has been provided with a substantial windfall from the run-up in the value of Arlington homes. Malanga was interviewed earlier this week by FrontPageMagazine.com. His response to several question was quite informative. For example, he notes that unlike what is happening at the national level where politics is moving rightward, America's cities and states are seeing "the rise of a political party that's neither right nor left, strictly speaking, but rather a coalition of those who benefit from an ever-expanding government . . . in ways that impose steep costs on taxpayers, ways which are not easily unravelled." But Malanga has hope, saying, "I think we are on the verge of seeing a new taxpayers' revolt in the U.S. at the state and local level, as the price of the expanding public economy becomes very difficult to bear. We see all sorts of spending cap initiatives and taxpayer bills of rights emerging in states, as well as legislation to rein in the power of public sector unions." The revolt can't start too soon for us.

June 29, 2005

How do you know Arlington County is overstaffed?

The short answer is to look at all the silly awards the county has been receiving as of late. During the month of June the county has received such awards as:

June 13 - E-Gov Solutions Pioneer Award
June 24 - Award for Leadership in "Green" Fuel Usage
June 27 - Award for Most Sustainable Community Program
June 29 - Commuterdirect.com Corporate Services Regional Award

If county bureaucrats were winning awards for real accomplishments such as largest tax cut in Northern Virginia, or fewest vagrants per capita, or most cost-efficient school system in Virginia, or least subsidized buses and other mass transit systems, or fewest potholes per mile, then taxpayers would know that their tax money was being wisely spent. However, it costs Arlington taxpayers around $200,000 annually for membership in the Washington Council of Government, which awarded Arlington the Commuterdirect.com Corporate Services Regional Award. The cost of belonging to Virginia Clean Cities or the Virginia Sustainable Building Network is not readily available. Maybe the extra staffing is necessary so Arlington can compete against Hong Kong and Ontario, Canada (E-Gov award) to give credence to Arlington bureaucrats' continuous chortling about Arlington being a "world-class residential, business and tourist location."

June 28, 2005

The Problem with "Funding Formulas"

An editorial in today's Washington Examiner addresses the problem with funding formulas, in this case the transit formula. According to the editorial, "Congress has allowed transit agencies 'to overinvest in capital-intensive projects in order to get 'their' share of federal funds,'" but in the process, the funding formula "has created major disincentives to provide the public with the most cost-efficient public transportation available -- and that's bus routes, not rail lines." In the study cited in the editorial, transit ridership in 23 urban areas were compared, and the conclusion was that "(c)ities that emphasize far less expensive bus transit attract riders just as fast -- or even faster -- than those with expensive commuter rail lines. Yet to snare federal funds, transit officials, including those running Washington's Metro system, push to expand rail despite its poor record." The president of one local group opposing Metro's rail to Dulles saying the line could end up "costing taxpayers billions in construction, operating and maintenance costs, plus higher tolls on the Dulles Toll Road." That's ok, I guess, since environmentalists and the rail construction industry will benefit.

June 27, 2005

Taxpayer Subsidies for So-Called Affordable Housing in Arlington County

For housing activists, so-called affordable housing seems to be a religion that requires faith. And taxpayers are required to pay for the activists' "anointed visions." As noted in this column in Governing magazine, which describes the author's experience in testifying about one particular housing development before the Arlington County Board: "To housing activists, however, (the number of "affordable" units created by even the most ambitious project is) not especially important. What matters to them is that there is a housing crisis -- also rarely defined in precise terms -- that dealing with it is a morally significant cause, and that any new units created under whatever circumstances, are a contribution to social justice." He further adds, "The claims made in behalf of any new project tend to be rather grandiose," anyway. The cost to taxpayers? According to information prepared for the Affordable Housing Roundtable (Adobe required), the cost is nearly $36 million for fiscal year 2006, which starts July 1. That includes $19.4 million in federal and state tax money and $16.4 million in local tax money. The spending is spread over numerous functions and programs. As noted in the June 23 issue of the Arlington Sun-Gazette, "The housing roundtable group was formed by (the County Board chairman) in the wake of last year's court ruling," which "rejected the county government's policy of coercing housing contributions from developers in exchange for higher density on their projects." Details about the roundtable, including the Arlington County Board's resolution, is available from this county webpage. This project of the Arlington County Board is a microcosm of the growing dependency that Rebecca Hagelin talks about in a recent WorldNetDaily column. Based upon a Heritage Foundation study, she says it "shows that Americans today rely more heavily than ever on government for the money that pays for their education, health care and housing, among other things. "With a population of about 195,000 people, the per capita annual cost for taxpayers is about $185.

June 25, 2005

"Pouring More Taxpayer Money Into Universities Doesn't Lead to Prosperity"

That's the conclusion of economics professor Richard Vedder in his "On My Mind" column in the June 1 issue of Forbes magazine. He adds "the evidence suggests that increased public funding for universities doesn't lead to greater prosperity -- and may even reduce the chances of it." Vedder "compared the 10 states with the highest state funding for universities against the 10 states with the lowest. The result: the low-spending states had far better growth in real income per capita, a median growth of 46% compared with 32% for the states with the highest university spending." The bottom line according to Vedder: "increasing funding to universities means transferring resources from the relatively productive private sector to higher education, which tends to be less productive and efficient." Hey, Senator "Gargantuan Tax Increase" Chichester, can you relate to this?

June 23, 2005

Taxpayers Have Tea Parties; County Board Members Have Lei Parties.

Two members of the Arlington County Board will be heading to Hawaii next month to join about 3,000 county officials from across the nation in attending the annual convention of the National Association of Counties, report the Arlington Sun-Gazette and the Washington Post. In April, the two Board members joined their colleagues in approving a budget that will increase the average residential homeowners' real estate taxes by 13.6%, despite cutting the tax rate by 8 cents. Board members thought attendance at the NACo convention was appropriate and not an abuse of tax dollars, although one of the "stay-at-home" colleagues opined at last Saturday's Board meeting that ACTA's president was "hitting below the belt" for questioning the $6,000 or so in travel expenses the two Board members will incur. County poohbahs tout Arlington as a world-class community so they must think they need to travel half-way around the world to demonstrate to the nation's county officials that it is indeed true. Now if they'd managed to hold residents real estate taxes to less than the inflation rate, the two world-traveling Board members would have had something to tell their fellow county officials. By the way, the county's annual dues to the National Association of Counties (NACo) are about $3,500 annually.

June 22, 2005

An Opportunity to Say 'No'

Libraries generally don't have the "tug 'n pull' effect on taxpayers' hearts as does K-12 public education. However, libraries are usually seen as part of a community's infrastructure since most are not big-ticket items in the budgets of most local governments. Consequently, it was surprising to read this morning on Buffalo's WBEN radio website that voters in Niagara Falls had rejected a library tax by a rather wide margin, 59-41, which means the town's two public libraries will close on July 1.The radio's news report quoted a trustee of the library board saying, "It's not that they don't want a library, they don't want a tax." City officials are scrambling to find other revenue sources. Makes you wonder how a similar vote would turnout in Arlington County. Hat tip to Virginia News Source.

June 21, 2005

Federal Income Taxes: More Being Paid by Fewer and Fewer

The Tax Foundation concludes the "number of Americans outside the income tax system continues to grow" in a study published earlier this month. Looking at five decades of data, the study found the percentage of tax filers who owe zero tax liability increased to 32.4% in 2004 and "does not appear to be slowing." Last year, Vice Presidential candidate John Edwards (D) often spoke about "two Americas," but the study says "One of the biggest obstacles facing President Bush's Advisory Panel on Federal Tax Reform is the fact that America has become divided between a growing class of people who pay no income taxes and a shrinking class of people who are bearing the lion's share of the burden." The study is filled with instructive charts and graphs for those wishing to better understand the phenomenon. For example, while 93% of non-payers reported income of less than $30,000, the profile of non-payers extends past $75,000. The redistribution of wealth continues unabated!

June 20, 2005

More Metro Mismanagement

Two weeks ago, we Growled about what can only be called mismanagement at Metro. For example, we noted that after investing more than $1 billion, internal records showed the projects created new problems. We also noted that in the fiscal year that will start July 1, Arlington taxpayers will provide over $30 million in subsidies to Metro, including $13 million directly from Arlington taxpayers. The editorial in today's Washington Examiner says it's "Time for Metro to get real." Specifically, the Examiner notes that last "Thursday, the Metro Board approved a $1.5 billion budget -- the largest in the transit agency's history -- which includes an 8% increase in the subsidies paid by local governments. But even that won't be enough." They note that Metro's management is trying to get $1.5 billion from the federal government, which is in addition to $1.8 billion in "emergency funding" it has already received, not to mention it's push for a "regional Metro tax." The editorial also notes: "Yet Metro is still planning a $4.2 billion expansion to Tysons Corner, even though the Final Environmental Impact Statement candidly admits that 'the increase in transit ridership associated with (Dulles Rail) would have very little effect on vehicle-trip reduction at the regional level.'" As the Examiner suggested in titling their editorial, it's time for Metro to get real. We would add that it's time for Metro to stop putting the squeeze on Arlington taxpayers.

June 19, 2005

A Luxury of Living in Arlington County, Virginia

We were reminded of this by a story in last Friday's Loudoun Today. After noting the rising cost of construction and that high school athletic complexes now cost about $6 million, the article goes on the discuss some of the tradeoffs, alternatives, and need to prioritize spending that some school districts have to consider in lieu of ever greater reliance on taxpayers' deep pockets. For example, the two high schools in Roanoke share the 63 year-old Victory Stadium owned by the city. The great movers and shakers of Arlington, aka the Arlington County Board and the Arlington School Board, unlike their counterparts throughout Virginia, have the luxury of not having to prioritize spending. At least it sure seems that way as we've watched the replacement of Washington-Lee High School move along.

June 17, 2005

One More Time: Was That Tax Increase Really Necessary?

A year ago, we growled a great deal about the $1.5 billion tax increased passed by the 2004 General Assembly. The necessity of that largest tax increase in Virginia history is about to be talked about again by the candidates for Virginia governor in light of the news that tax revenues are literally flooding into Virginia state coffers, predicts today's Washington Post. According to the Post, the Secretary of Finance "told the Senate Finance Committee that tax collections have increased by 15.2% over the first 11 months of the last fiscal year . . . well ahead of the official forecast of 10.3% growth for fiscal 2005, which ends in two weeks. Revenue grew at an even higher rate in May, increasing by 23% over last year." The AP story in today's Newport News Daily Press points out, "Even without last year's $1.4 billion tax increase, revenue would have been up 19.2% last month." The bottom line, as usual, seems to be provided in a Richmond Times-Dispatch editorial: either Governor Warner's fiscal analysts "are woefully off base in their revenue projections . . . or Warner and his staff continue lowballing estimates in order to increase support for the Governor's political agenda." Let's find out if either gubernatorial candidate supports legislation for a Colorado-like Taxpayer Bill of Rights, which would control spending and result in refunding the excess revenues back to the taxpayers!

June 16, 2005

Are Newspapers Adequate Watchdogs of Virginia's Public Schools?

A recent study published by the Clare Booth Luce Policy Institute (Adobe required for the reports' individual sections) suggests that daily newspapers in Virginia may not be providing the public with fair and balanced coverage of elementary and secondary education. The study reports in the executive summary that "Public education consistently ranks at or near the top of (most Americans) domestic concerns . . . readers would have to look long and hard to find the larger education story in their daily newspapers." That would seem to be our impression of the coverage of Arlington's public schools by the region's daily newspapers. The study points out that "newspapers rely on the public school industry to set the education news agenda" and that "newspapers education news coverage is largely a conversation of, by, and for the public school industry." On the other hand, the study says that "taxpayers who bear the cost of the public school service received scant attention from newspapers," e.g., in a survey of 261 publc school funding related news articles, "individual taxpayers were quoted six times . . . and taxpayer advocacy groups were never quoted." The study involved a phone survey of education print reporters and analysis of 403 education-related news articles published over eight months by four daily newspapers in Virginia. For coverage of Arlington's public schools, our impression is that Arlington taxpayers are better served by the Arlington Connection and Arlington Sun-Gazette than the three dailies.

June 15, 2005

Freedom and Prosperity -- Endorsement of an Agenda

At its monthly meeting this evening, the board of directors of the Arlington County Taxpayers Association (ACTA) endorsed the Freedom & Prosperity Agenda unveiled by a coalition of Virginia conservatives in Richmond on April 12th. The agenda is an 11-point plan designed, in the words of Virginia Institute for Public Policy president John Taylor, "To protect the properties, incomes and futures of Virginia's citizens." Taylor noted that, "It took 386 years for Virginia to reach a $30 billion biennial budget. It only took the last 10 years to add another $30 billion. The Freedom and Prosperity Agenda gives conservatives in the General Assembly and throughout the Commonwealth a game plan to restore the balance between the people and their government." ACTA becomes probably the first taxpayer organization in Virginia to endorse the agenda, which focuses on taxes and spending, property rights, education reform and transportation.

The Freedom & Prosperity Agenda includes the following planks:
+ Eliminate the War of 1812 tax (BPOL)
+ Pass a Taxpayer's Bill of Rights (TABOR)
+ Eliminate the Death tax
+ Eliminate the prepayment of the Sales and Use tax
+ Redefine and limit the public uses for which private property may be confiscated
+ Constitutional Amendment to base real estate taxes on the acquisition value of the property
+ Parental choice in education
+ Protect the transportation trust fund with a Constitutional Amendment
+ Proposals for new taxes must contain sunset provisions
+ Freedom and Fiscal Accountability Act for Virginia's Public Colleges and Universities
+ Eliminate the Car tax

We will be providing additional information about the agenda in the coming days and months. If you have any questions in the meantime, contact ACTA's president.

June 14, 2005

It's True, It's True! "If It Moves, Tax It!"

In one of his famous sayings, the late President Reagan said that "if it moves, tax it." As if to prove how true that saying is, London's Indenpendent newspaper reported yesterday that "Finance ministers from the G8 (group of nations) agreed at the weekend to look at using income from airline traffic to boost aid . . . The move, which could add a pound on to air fares, was greeted with delight by environmental groups who said it was a first step towards making people pay the true cost of plane travel . . . The G8 backed a pilot project, led by France and Germany, for a 'contribution of air travel tickets to support specific development projects.'" It never ceases to amaze the delight displayed by leftists in putting forth yet another tax scheme.

June 12, 2005

States Looking for ways to Calm Tax Revolts

This story in last Tuesday's Christian Science Monitor described what states are doing "to ease property-tax rise." For example, "123 property-tax relief bills have been introduced" in the New Jersey legislature while "Sen. Jon Corzine, the front-running Democratic candidate, announced his support for the (constitutional) convention and for lowering property taxes." To push the idea of a convention, Citizens for Property Tax Reform has a "tea party" planned for June 16 in Trenton. The article quoted an expert on property taxes who said, "Almost every state is looking at some form of property-tax cap." In addition, "The talk of a real estate bubble is causing additional angst because many homeowners are afraid that their taxes may be based on a market value that no longer exists." Two Virginians, both members of Virginians Over-Taxed on Residences (VOTORS), including its chairman and founder, were cited in the article. Unfortunately, a point little-mentioned is that if government, especially local government in the case of real estate property taxes, were not so greedy, there would be far less pressure for taxpayers to revolt.

June 11, 2005

What Does Real Tax Reform Look Like?

The Tax Foundation provides the answer by pointing to Slovakia, and calling it a 'tax reform miracle.' According to the Tax Foundation, "In 2004, the Slovak Republic launched the kind of truly radical tax reforms that are unthinkable in the current political climate in the U.S." They add, "In one sweeping bill, Slovak policymakers collapsed five income tax brackets into one, eliminated virtually all exemptions and tax deductions, repealed several forms of double taxation (transfer taxes, donation taxes, and inheritance taxes), and set their corporate tax rate equal to their flat individual income tax rate . . . a shocking political accomplishment that should serve as a beacon of hope for tax policymakers everywhere."

A similar accomplishment in America would be passage of the Fair Tax (HB 25. which you can search at Congress' THOMAS website). It is endorsed by the National Taxpayers Union. You can also learn more at the Fair Tax website.

Unleash the American economy! Pass true tax reform. Pass the Fair Tax!

June 09, 2005

Planting the Seed for a Virginia Taxpayer Bill of Rights

If future generations of Virginians can point to the day that enables them to live in greater freedom and properity, it may very well be June 8, 2005. According to an AP story in today's Washington Times, "Anti-tax activists from across the country met in Richmond yesterday (and today) to discuss their strategy for persuading states to adopt a taxpayer bill of rights, similar to one that Colorado voters approved in 1992 . . . Colorado's law restricts government spending growth and requires the state to return supluses to taxpayers." More specifically, the newspaper reported, "In Virginia, a conservative coalition called the Tuesday Morning Group is pushing for such a law as part of an 11-point agenda." Essentially, a taxpayer bill of rights means putting more money into the hands of individuals and families rather than leaving it in the hands of government and their sycophantic special interest groups.

June 07, 2005

Tale of Two High Schools, Part II

On May 30 of last week, we growled about the cost of Fauquier County's third high school (1,500 students) being significantly less than Arlington's replacement of Washington-Lee (1,600). A third high school can now be added to the comparison, i.e., Alexandria's new T.C. Williams High School (2,500 students, press release) that just broke ground last November. A comparison of the cost of the three schools are:

Washington-Lee/$95.2 million/cost per student seat -- $59,500
Fauquier's 3rd H.S./$50.6 million/cost per student seat -- $33.733
T.C. Williams/$88 million/cost per student seat -- $35,200

There are legitimate reasons for the differences, e.g., the new W-L will have a 10-lane swimming pool, more classrooms, LEED certification, etc. However, we will ask the School Board to provide a cost comparison that provides transparency so that Arlington taxpayers understand whether or not the School Board is building will be built of ordinary brick and mortar or whether it will indeed be deserving of being called a Taj Mahal.

June 06, 2005

Your Tax Dollars (Not) at Work at Metro

Yesterday, the Washington Post published the first of a four-part series on Washington's subway system (today's second part is here). They found the system "has fallen into a decline -- and mismanagement has been a key factor," according to records reviewed by the reporters. One particular problem involved the floors of the cars, which Metro managers blamed on the Metro's board of directors who were pushing a speedy opening of the Green Line stations by January 2001. And after spending "nearly $1 billion in recent years to turn around the nation's second busiest subway system . . . internal records show that the projects have created new problems." By the way, a member of the Arlington County Board is a member of Metro's board of directors. For Fiscal Year 2006, Arlington taxpayers will provide $30.7 million in subsidies to Metro. Half of it comes in the form of state transit aid and a regional gas tax, but $13 million comes directly from the general fund, aka Arlington's taxpayers. Why even have a County Board representative on the Metro board? We'll update you if there are significant revelations in the Post's final two installments.

June 04, 2005

Some Things About Taxation Remain Unchanged Over the Centuries

Several years ago, our newsletter, The ACTA Watchdog, featured a trend analysis showing how the federal income tax had grown over time. Specifically, it showed how the income tax started small in the early 1900's, and how it grew over time. This post at Cafe Hayek notes that in the 14th century, Muslim scholar Abu Zayd Ibn Khaldun said, "In the early stages of the state, taxes are light in their incidence, but fetch in a large revenue . . . As time passes and kings succeed each other, they lose their tribal habits in favor of more civilized ones. Their needs and exigencies grow . . . owing to the luxury in which they have been brought up. Hence they improse fresh taxes on their subjects . . . (and) sharply raise the rate of old taxes to increase their yield. . . ." Isn't it nice to know that some things do not change over time. And you thought that today's politicians were smarter, eh?