Property Taxes in the News

Posted on by David Stokes

The Kansas City Star has an interesting article on why property taxes keep going up despite the downturn in the housing market, which would presumably lead to assessments going down. The reason is that property values are supposed to be set at their January 1 value, so the last 11 terrible months in housing values don’t count. Also, the comparable sales method used to set values can come from any time since Jan. 1, 2005. The hope would be that the 2009 assessment would capture much of the housing downturn of the past year, but how much do you want to bet it doesn’t?

On the same subject, the Sunday Joplin Globe had a very reasonable editorial on the assessment situation in Jasper County and around the state. While I don’t agree with the Globe that we should replace property taxes with higher income or sales taxes (particularly income taxes), it was nice to read their well thought-out editorial. I do agree with them on the importance of having a general debate about how we tax and spend here in Missouri. We have not agreed with the Globe’s editorials much here at SMI, with their opposition to toll roads and support of Internet taxation, but this was a good one.

For my own ideas on how we can change the assessment system in Missouri, here is my recent article on the subject. Also, don’t forget that your property taxes are due by December 31! And the above links came from Combest, so let’s give him a Christmas shout-out!

Gun Buyback Program Provides Seed Money for New Guns

Posted on by David Stokes

The one-day flowering of peace and safety in St. Louis city has ended, with the city police purchasing 540 guns from its citizenry as part of a one-day gun buyback program. At least, it might have been citizens of St. Louis; it could well have been people from anywhere who had a worthless gun to unload and found a way to get $50 for it. The Post-Dispatch story is here. It would appear from the totals that they got very few, if any, assault-type weapons off the street. The budget was $20,000, with a price of $100 per assault-type weapon and $50 for handguns and shotguns. A total of 540 guns at $50 each is $27,000, so that did not leave much money for any assault weapons. And what about the guns that were bought with taxpayer dollars? From an article that originally appears in the Chicago Tribune:

The weapons turned in during buy-backs overwhelmingly are older guns, such as revolvers, which in some cases don’t even work. A Harvard study of buy-back programs in Boston in 1993 and 1994 found nearly three-quarters of the guns recovered were made before 1968. In Seattle, one-quarter of the guns collected were inoperable.

Basically, the city is doing nothing more than giving people tax money to go purchase newer, better guns. If the city is trying to become the living embodiment of Robert Heinlein’s statement that "An armed society is a polite society," than I would call the buyback program a success. Somehow, I think the city was going for something else — mostly stemming from a delusional belief that this program was going to improve safety in the city.

The best thing to say about this program is that it only lasted for one day. A study I linked to in last week’s post on this subject found that long-term programs actually increase gun ownership as they lower the overall costs of gun ownership. Among the ways it would do this is by creating a floor value of $50 for any gun, no matter how low the market value, if any, for that gun. Come to think of it, if we could change all stupid government programs from permanent fixtures to one-day events, that would be real progress!

Math Wars

Posted on by Sarah Brodsky

What are "contextual and situational situations"? It has something to do with integrated math, the latest topic of discussion at Schoolhouse Talk:

Integrated math allows students to learn the same content that is taught in algebraic math, but in a different context, with an emphasis on contextual and situational situations rather than formulas and algorithms.

Integrated math (or "new math," or whatever you want to call it) provokes heated discussions in Missouri and around the country. Edspresso has published an essay titled, "Traditional Math Means Never Having to Say You’re Sorry." There’s even an entire website, Weapons of Math Destruction, which has published 85 cartoons on the topic of integrated math.

Anyway, the latest development in Missouri is that some parents are complaining about the Columbia Public Schools’ integrated math curriculum. The district uses integrated math at the elementary level and gives high school students a choice between integrated math and a traditional math track. I haven’t been able to find out whether the middle schools use only one program, or both. Some Columbia parents supplement their kids’ schoolwork with Singapore Math, one of my favorite math curricula. (Yes, I actually have favorite math curricula.)

I’m sympathetic to parents’ objections about new math, but that doesn’t mean the district should necessarily get rid of it. Kids don’t all learn the same way; for many, an integrated approach could be more intuitive or interesting. Columbia Public Schools already give parents a choice about math at the high school level. If they allowed parents to choose traditional math at the elementary level too, more people would be satisfied with the curriculum. Some elementary schools allow parents to choose between single-sex and coed classes; a choice between traditional and integrated math should be even easier for schools to offer, because it affects just one subject rather than the entire school day.

Taxes Go Up Incrementally; Why Shouldn’t They Go Down Incrementally?

Posted on by David Stokes

Let me start by saying that I love the St. Louis Business-Journal and read it every week. It plays a great role in our community and does it very well. They are also generous to SMI, carrying our op-eds at times — including today — which we greatly appreciate.

That said, I have to strongly and respectfully disagree with their editorial today. I can’t link to it, because it’s not available on-line, so you’ll just have to trust me on the quotes. In short, they commend the St. Louis County Council for NOT lowering the tax rate by 2 cents, as was proposed by Councilman Greg Quinn. They state that it demonstrated political courage NOT to lower taxes, dismissing the notion of saving homeowners $7.60 per year, on average. They write:

Hefty increases in property taxes throughout the county have fueled a taxpayer revolt. If the council decides to dramatically reduce property taxes, the action should come as part of a studied budget plan that would include new sources of revenue to balance the monies raised by property tax.

So if you are going to cut property taxes, make certain that you raise other taxes, to keep overall tax revenue the same — even if the property tax increases are the result of reassessment, which (and this is the key) are not supposed to raise taxes. The editorial buys into the popular government notion that everything government does is so important that it should never reduce services, or even just hold back the growth rate of services.

It is not "pandering," as the editorial says, to slightly roll back property tax rates for citizens. As the title of this post says, taxes rise incrementally (a slight sales tax increase for fireman pensions here, a property tax increase from reassessment there, a business license fee hike tomorrow) so why shouldn’t they decrease incrementally? Especially when they result from reassessment, which — I repeat — is NOT supposed to result in a tax increase.

St. Louis County government is not legally required to roll back its rate, which is far enough below the authorized cap. The fact that the rate is low is a good thing, but it is really just a loophole in the law. It does not mean they should treat assessment increases as a windfall every year, dismissing a moral obligation to roll back rates. A small rollback says to taxpayers that the county understands the reassessment tax increases people face, and is going to address the issue responsibly — not just take all the new tax money and spend it.

It is not politically courageous to refuse to lower tax rates. St. Louis County has an obligation to lead by example, demonstrating to the many other nearby taxing districts that a rollback after reassessment is the right thing to do, even if it’s not required.

Missouri Cities: Top Places to Educate Kids?

Posted on by Sarah Brodsky

St. Louis has won an unlikely honor. Forbes ranks the area as number nine in its list of the top places to educate a child.

Huh? Where were they when the takeover of the St. Louis public schools made national news? Or when suburban districts refused to accept city students? There are some better public schools in the suburbs, and several good private schools in the area, but it still seems like they need to qualify this. Maybe: "Top Places to Educate Your Kids — If You’re Rich Enough to Afford the Best Real Estate or Private School Tuition."

The only category in which St. Louis gets a low grade is "Library Popularity," in which it earns a C+. That just doesn’t seem like the one category in which the education system here needs the most work.

There are a few comments challenging the article, but they’re not about St. Louis. They’re debating whether Columbia deserves its award: number 19.

Lock Box Strategery

Posted on by Justin Hauke

To the bemoaners of “tax cuts for the rich,” a new Congressional Budget Office report shatters some popular perceptions on which income groups have benefited the most from federal tax reform (see Table 1A).

The report finds that the average effective federal tax rate (this rate includes all federal taxes, not just income taxes) in 2005 was 20.5 percent of income, compared to the 1979-2005 average of 21.6 percent. Although all Americans are paying lower taxes today than they have historically, what’s really interesting is that the tax reduction for lower income quintiles is significantly greater than that of higher income quintiles. The numbers below (the computation idea was stolen from Greg Mankiw’s blog) demonstrate this fact. The first number is the 2005 effective tax rate. Numbers in parentheses are average tax rates from 1979-2005.

All households: 20.5 (21.6)

Lowest quintile: 4.3 (7.2)
Second quintile: 9.9 (13.2)
Middle quintile: 14.2 (17.1)
Fourth quintile: 17.4 (20.1)
Highest quintile: 25.5 (26.1)

Top 10 percent: 27.4 (27.6)
Top 5 percent: 28.9 (29.0)
Top 1 percent: 31.2 (31.7)

Amazing how that works out, isn’t it? The lowest income quintile has seen their federal income tax burden drop from 7.2 percent of their earnings to 4.3 percent, while the highest income quintile’s income tax burden has only dropped from 26.1 percent to 25.5 percent.

To me, the most important thing these numbers highlight is how effectively governments can hide tax burdens. So much emphasis is put on the income tax because it’s the only tax for which we have to spend hours filling out forms in order to comply with it each year. But what we forget about are the umpteen taxes on the things we use every day (our utilities, our gasoline, our food, our clothes, etc.), which we don’t even think about.

Too bad these are probably the lowest taxes Americans will see for a LONG time. Makes that whole "Roth IRA" thing sound like a good idea. …

An Awesome Idea

Posted on by Sarah Brodsky

It’s because of stories like this (thanks, Edspresso!) that I’m happy and optimistic. It’s about a public school in Houston that combats the dropout problem by offering students flexible school hours. Students can take courses in the evenings to make up for the time they’re out of school during the day. A Texas state representative explains why the regular school day just isn’t for everyone:

State Rep. Scott Hochberg, who proposed the bill, said he hopes it encourages districts to offer evening or weekend classes for students who must work to support their families and cannot attend school during the conventional 8 a.m. to 3 p.m. day.

"For anybody who has to work, that schedule just doesn’t work," the Houston Democrat said. "We were forcing kids to give up the possibility of completing their high school education and going on to any higher education."

I’m not familiar with any public schools that do this in Missouri, but at least one private school, Dayspring, offers homeschoolers opportunities to attend classes part-time. And many public GED courses in the St. Louis area are taught in the evening. If you can teach GED preparation in the evening, why not teach regular high school courses then, too? That could prevent students from dropping out, so they won’t need to take the GED.

Teachers’ Test Scores Going Up

Posted on by Sarah Brodsky

There’s good news in this article on teacher quality:

The average SAT verbal scores of prospective teachers passing the Praxis tests to teach English, science, social studies, math and art from 2002 to 2005 were higher than those of prospective teachers in the mid-1990s — and were also higher than the average SAT scores for all college graduates, the report said.

I wonder how much of this improvement has to do with alternative teacher certification, which allows people who majored in subjects other than education, and who may have work experience in other fields, to become teachers. (Statistics on the growing numbers of teachers who have completed alternative routes are available at www.teach-now.org.) Under alternative certification, a retired scientist could teach a high school biology course or a history professor could teach AP Government without having to go back to college for an undergraduate education degree.

The article notes that the SAT scores of potential elementary school and physical education teachers are still below the average for college graduates. For physical education, I don’t think we need to care. Teaching kids about basketball and teamwork just doesn’t require a lot of complex reasoning. But maybe we still have work to do at the elementary level.

Good Time for Criminals to Sell Old, Crappy Guns in Order to Buy Better Guns

Posted on by David Stokes

There are few things as worthless as a gun buyback program. Here is the article on this weekend’s one-day exercise in giving people taxpayer money to purchase new guns. After the "tremendous" success of the 1991 St. Louis City Police Department gun buyback, as the Post-Dispatch puts it:

The 1991 cache was a huge success — but it was based on a 30-day program. The 2007 effort is one day only.

We are going to do it again. It was such as success in 1991 that the City of St. Louis became one of the safest cities in America in 1992 and has remained so ever since. Oh, wait — check that — it has consistently been one of the murder capitals of America since right about that time. …

I got rid of an old shotgun a few months back, and now I feel like a moron. I should have held onto it and sold it to the city police for $50. That’s $50 more than I got for it.

These programs are like the forced sterilization programs in India in the 1970s. If I recall correctly from history class, the government ordered every family to have at least one male be sterilized in an effort to control population growth. Not surprisingly, a lot of 80-year-old grandpas showed up for their vasectomies. A gun buyback program is exactly the same. If someone has an old gun lying around, this is a good time to git rid of it. Check out this study for evidence. (Sorry, but I can only link to the summary. You have to pay for the whole thing.)

Economist Glen Whitman writes on this subject:

Consider the case of gun buy-back programs. These programs aim to reduce the number of guns on the streets by having authorities buy them up. Cities with gun buy-back programs tout their success by announcing the number of guns purchased. It’s possible, however, that people will bring guns to town just for the purpose of selling them?after all, if the city paid less than the market price, gun owners would sell their guns privately. The real question is not how many guns are purchased, but how many guns remain on the street. And this is setting aside the difficult question of whether reducing the number of guns actually reduces violent crime. Since criminals presumably have the greatest need for guns?their livelihoods depend on them?they are probably the least likely to sell them.

Or you can read this article, which originally appeared in the Chicago Tribune.

I know somebody who reads this is going to think to themself, "But if it just saves one life it is worth it." And, yes, that is an impossible argument to refute, and saving one life is wonderful. But you will never know whether the program saves one life — you just have the data which tells you it is totally ineffective and a waste of money. But it makes people feel good and provides good PR, so if you have a crappy gun lying around and would like to get $50 toward a better one, this is your opportunity.

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