Wednesday, January 18, 2017

Wylie Tax Rate Kept Artificially High


As the highest taxed city in Collin County, at 84.89 cents per $100 assessed property valuation, Wylie’s taxpayers shouldn’t expect our city to be gouging us. It is especially unconscionable when one hears just how much money the city netted with the massive property valuation hike Collin County gave taxpayers for several years running. Wylie has been holding a ridiculously inflated property tax rate stable, despite publicity claiming they lowered our tax rate between a ¼ cent and 2 cents for the past handful of years.

So exactly how can a city provide a “tax break”, yet still increase taxes? Here is a prime example that took place last fall during the budget process. The City Manager Mindy Manson told council members that the $2.9 million projected revenue in excess last year, one of the best excess leaps the city has seen in years I might add, would not be enough to cover expenses because of additional spending requests, and because she intimated the city was under-insured from the catastrophic hail storm that took place on April 11, 2016.

Further scrutiny of that lagging hail claim payout actually represents upgrading and remodeling the entire public safety building instead of just repairing it to pre-storm condition. Yet Manson suggested the city hold tight on the bloated tax rate, just in case the insurance deal did not pan out for their total remodel.

Reading between the lines, Manson told council members that staff was increasing spending to take up the rather generous sales and property tax revenue, and that they intended to do a full remodel of the public safety building, adding on expenses far beyond repairs that insurance would reasonably cover.

To appear accommodating, Wylie Mayor Eric Hogue ultimately suggested a 2 cent tax decrease during the budget season, hoping taxpayers would heave a collective sigh of relief. Even with this decrease, our taxes went up.

Not only is the city spending like a drunken sailor, but they are artificially keeping the tax rate high by ignoring the effective tax rate. Each year, after Collin County completes assessments, they inform each city of the tax rate needed to keep taxpayer burden stable. This year the effective tax rate for Wylie was .795191. Each year, the city council ignores the effective tax rate, instead tossing small breaks back to the taxpayers, which does nothing to offset the growing burden of improving property values. This year they had over 7 cents they could return to taxpayers to keep their tax burden the same, instead they gave us 2 cents, earmarking the rest for spending.

Many taxpayers simply ignore this sleight of hand routine, erroneously thinking their duty is to improve the growing city, and that they are getting tangible things in return, such as road improvements and increases in fire and police protection. Taxpayers neglect to understand that growth pays for growth, and city administrators do not want them to understand this concept.

Cities coerce taxpayer capitulation through fear, by explaining that they need the additional funds to help cover growth and that if they don’t receive them, services must be cut. Taxpayers altruistically buy into this scheme, thinking they are covering growth and helping the good of all citizens. This fallacious system means cities across Texas are keeping the excess funds from increased property values, instead of allowing growth to pay for itself as each new business and homeowner is tapped.

A prime example of the increase can be seen in comparing our total annual tax payment when we built our home in 2001 which ran approximately $3900 in taxes, to what our current property tax burden is at approximately $5600. Growth from approximately 4600 citizens to over 50,000 during this time has more than paid for the new roads and services. So exactly what did we get for the doubling of our taxes?

As a side-note, as I was poll greeting outside the library during the primary last year, one of the city councilmen told me that the city would be coming to the taxpayers soon for a bond to improve the roads. This mindset is completely unacceptable.

This example shows why it is critical that citizens become involved in the budget process each year, and demand that Wylie adopt the effective tax rate. Expect an initial budget look around municipal elections, with regular budget meetings ramping up through the summer, toward final adoption in the fall. The alternative to getting involved in the process is to continue unwittingly funding the city’s spending sprees each year, and watching money needlessly drain from our bank accounts.

Image: http://www.understandglobalization.com/wp-content/uploads/2014/09/tax-burden.jpg