Tom Sheff and state Rep. Ruth Balser are working together to draft a bill that give voters a local option to approve a property tax surcharge to pay for upgrades to crumbling roads, municipal buildings and other municipal infrastructure, the TAB reports.
If I understand the idea, taxpayers could be asked to essentially approve a tax override of sorts dedicated for infrastructure. But it might include possible matching dollars, similar to the way the Community Preservation Act does (although the story doesn’t say where that money comes from).
Good idea? Bad idea?
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We already have the ability to raise monies for infrastructure through something called a debt exclusion override. And on the schools side, the state already has a mechanism for providing significant funding through MSBA.
Other than gaining what some might think as “free money” like was supposedly the case with the Community Preservation Act, we ought not lose sight of the fact that money has to come from somewhere. I much prefer knowing how much a project is going to really cost us, and let the voters decide on a case by case basis whether to fund, without gimmicks to cloud the real cost.
I agree Dan, except if there was a pool of money attached, it would be more than a little tempting to sign on. Say, perhaps the state diverted some money that might otherwise go to local aid or highway dollars to a fund that rewarded communities for caring for infrastructure. That feels regressive and unfair to less affluent communities (just as the CPA does) but again, it would hard to turn away “free” money.
Bob Rooney told the Programs & Services Committee tonight that the Mayor is putting everything on the table to try to meet the capital improvement needs of the city. So the committee approved the item and sent two different versions of former alderman Paul Colletti’s proposal to the Finance Committee. Dan, Bob Rooney advised us that there are hundreds of projects with an estimated price tag of $240 million that need to be commenced over the next five years. Not all of those projects are of the size that warrant a debt exclusion. Nevertheless, they are very real and immediate needs.
Dan, you’re a financial guy with common sense. Let me make this argument as coherently as possible. This fund would increase the cities ability to repair infrastructure by approximately 33%. This means we can cut back 20 years worth of projects to 13-14 years. It saves on 7 years of inflationary costs. We just saw how NNHS went from 70 mil to 200 mil in 10 years. Dont you think the city would save significant money in the long term? A debt exclusion override can increase prop taxes by 3-4% per year, depending on the project, this only increases it by 1% per year. Also, debt exclusions aren’t a shoe in by any means.
Even if you oppose the bill, you and Greg are welcome to paticipate in the early wording of the bill to make sure it funds what you want it to.
Thi is totally different than the CPA in several ways: the CPA has a CPC (Community Preseration Committee) this won’t (as o right now) and the CPA was intended to purchase property that cities and towns wouldn’t normaslly purchase for themselves, this bill is intended to be used for projects that are necessary. It wont cover property already purchased by CPA funds. The funds can be used for schoos, streets, parks, trees, sewage an any other infrastructure need. It will add jobs and improve massachusetts economy. We haven’t talked about wo makes the decision on what to purchase, I am assuming the city’s decision maker (mayor/city manager) who will make the decision on where to use the funds (unless someone hs a better idea).
Not purchase but renovate.
Increased funding for infrastructure sounds like a good idea. I’m just not sure why we need an entire new dedicated tax mechanism to do that. From a local point of view, this is something we can do today if we have the political will. From the state point of view, creating a new tax so that the state can dangle pools of “free money” to the towns does sound like a gimmick.
Jerry,
This bill would add jobs and improve the massachusetts economy, if implemented correctly, why shouldn’t the state partner with cities and towns through matching funds?
This is nothing more than a half hearted attempt to get around Prop 2.5. A tax is a tax is a tax. Personally, I am no fan of Prop 2.5. I think it needlessly hampers towns to provide high quality services. In its blatant disregard for Prop 2.5, the Balser/Sheff proposal is rather insulting to those who actually support that measure. Such deafness of tone on the part of our legislators is all too pervasive.
If you want to solve a problem (cities have too little money) then put forth solutions to solve the real problem (Prop 2.5 is overly constraining) and not some transparent hack bandaid. It’s called leadership.
Tom, it appears the only thing you have determined so far is that you want to take more of my money; you offer no other specifics. You include the possibility that the state may chip in some “free money”. Why don’t you offer coupons for free frappes from Cabots while you are trying to build support for this new tax? And, by the way, there is no “free money” from the state. That is tax money already collected from the taxpayers. Encouraging state politicians to decide who gets that money pits community against community and allows politicians to push their own private agendas.
Bob Rooney is already pushing for a 4% increase on our water bills for infrastructure repairs. Who else wants to add taxes to pay for the overly generous employees’ benefits and the poorly managed high school construction projects?
Eric,
This isn’t a “diregard for pro 2 1/2” because prop 2 1/2 has to do with the operational budget and the money can be spent on anything, this bill is airmarked for a specific purpose. Apples and oranges.
Patrick,
The reason why it seems like there is no details is because we’re in the wording phase. Every useful comment on the blog will be considered.
Friends,
Several years ago the CAG came out with a recommendation to increase our bonding capacity from 3.5% to 6%, remember? Everyone liked that idea, projects get done faster and we’re all happy. Where did you think the city was going to find the funds? They were going to find the funds by cutting services. This increases us from 3.5% to 4.5% (maybe more w/ matching funds) without losing any services.
Feel free to keep on debating (I love to hear from you, as long as it doesn’t get personal), but this will be my last post. Keep writing you’re thoughts, I appreciate it.
I don’t advocate a head in the sand approach for the future of Newton. The infrastructure problems are real ones. The generous benefits that some of Newton’s employees get have been negotiated through decades of contracts, they are now an obligation of our city. We can certainly work to negotiate better terms on future contracts, the mayor seems to be doing this, but it is a difficult task. As for the high school, yes, I, like many others, thought we should renovate. It was a huge project that was far too expensive. But we need to evaluate these projects on a case by case basis, and not be frozen by the prospect of higher taxes or the mistakes of the past from doing what it right long term for the community. We also need some amount of flexibility as a debt override can’t be the only answer.
I certainly don’t want my taxes going up any more than they have to. And I don’t want my water bill going up any more either (that has been a real shocker lately). But good communities with high real estate values don’t neglect their infrastructure, or they risk becoming less desireable places to live with lower real estate values. And more importantly, they risk the quality of life status of all citizens.
I acknowledge that a tax increase hits some of my neighbors harder than others. It certainly hits me hard. But I want a community with good schools, good playgrounds, good sewers, nice trees, good school buildings, and excellent employees. It is a delicate balance. In the end, I might not be able to afford it. But that doesn’t mean the community shouldn’t strive to become better and fix the problems. As painful as that may be one day for me personally or economically.
I can’t say whether or not this will fly, but I commend Tom for thinking deeply about this proposal and for putting it on the table for discussion. There are times that things that look great at first blush, but don’t hold up well under scrutiny. Other times things that are dismissed out of hand look better on second reading or with some modifications.
Mr. Sheff, though I am sure you are right technically, you could not be more wrong practically. The simple fact of the matter is that as a tax payer, once the dollar is out of pocket it makes little difference from to most people where exactly it is going. For you to think that the distinction you are trying to draw will be compelling to anyone outside of the relatively small subset of people who already agree with you shows just how out of touch you are. Even more astonishing is your dismissal of the DEO option. We live in a time when people are having real problems making ends meet. Salary increases are pretty small and every time we go to the pump, prices keep going up and up. In this environment, your argument against DEO is that government needs (wants?) more of your money to spend faster and oh, by the way, that whole override thing, well it is kind of annoying since it keeps acquisition of infrastructure funds from being a “shoe in” so let’s bypass it. Do you actually think this is a good argument?
It is not that I disagree with the sentiment that we need infrastructure improvements, but this idea will never fly. Moreover, by floating an idea that is so obviously lacking in its ability to be sold to the average voter, it actually probably hurts the larger cause in the long run by giving skeptics another in a long line of examples of how tone deaf government is.
Eric, please call me Tom, not Mr Sheff, please. I dont believe I a outof touch so we’l allow the voters to decide (hopefully).
Here is a comparison of our taxes under the last override vs this bill:
Assume average home in Newton is $680,000 and the yearly taxes on that house is $6,000.
Last override was for $12 million and the override can be used for basically anything. Approximate increase to the average home is $500 per year!!!!
Now this bill which can only be used strictly for infrastructure needs. Approximate increase to a $6,000 yearly property tax is $60!!!
#500 vs $60 or ($40.00 per month vs $5.00 per month).
Tom, I would vote for the bill in a hartbeat. Five bucks a month to fix or crumbling infrastructure seems like a bargain. It is just that I do not believe there is snowball’s chance in Hades that most people will concur. From the national dialogue to the local, a tax is a tax is a tax and all of them are bad. Well reasoned, even quantitatively accurate arguments are ignored or somehow argued as false. Here in Newton, it is going to take some time for the NNHS experience to dissipate. I would argue that you and Ms. Balser should really put yourself into the mind of the middle-of-the-road voter; a Newtonian with kids in the schools who voted against the last override or voted for it while holding their nose. What would they think of this? I believe such folks would view this as an attempt at an end around to Prop 2.5; taxation by other means if you will. Maybe this is not technically accurate, but perception and truth are as we all know not equivalent. These folks are facing rising fees from the schools for busses, sporting activities and such. They are seeing gas prices in Newton going up and up. In short, they are being nickeled and dimed from here to eternity. This comes across as one more toll in the road at a time when it is least affordable. For people with such a perspective, just because something is needed does not mean it is needed now if it means more $$ out of their pockets. If you could make an airtight case for your new tax proposal that adequately countered such sentiments, then perhaps it would pass. I just do not see it.
Eric,
Everything you said is 100% accurate. We are all getting hit with more and more taxes and/or expenses. I feel it, just like everyone else. The alternative is to sit here and do nothing. I can’t accept that. If anyone has a better idea than the bill (besides doing nothing) I am all ears.
We all went through and watched NNHS go from a $70 mil project to a $200 mil project because our leadership sat by and did nothing for 10 years. Now the stake is even higher, we’re are starting off at $250 mil worth of projects…..where will we be in 10 years? I know the NNHS situation still hurts,but sometimes you have to do whats right. I believe this is whats right. I know some of you maybe ticked at me for having the audacity to propose this, but I saw a problem no one was attending to and I did my best to come up with an answer to the problem as least harmful way as possible.
While I support the premise of the bill, I take issue with the magnitude.
As Ted stated; we have $240 million of projects to start in the next 5 years. So lets assume that if we really want to get Newton’s infrastructure back on-track it’s going to take $40 M annually for a long time. A 1% surcharge would raise $2,5 M annually … 1/16th of that.
My worry is after a big political fight to pass this – as big as any overrride I’m sure – most residents will say “didn’t we just give money to infrastructure?” when we need to actually fix something. I just can’t see this solving the problem it purports to solve.
What Anne just said.
One can only go to the well sparingly, so it better be worth it, so as to not kill the larger override that’s still needed.
I don’t like the idea of getting “free money” from the state as the justification for this. We pay for things directly [property taxes] or indirectly [state taxes].
Folks argue for the value of transparency and then want to support an approach that several have already characterized as a “gimmick.”
Dan,
You can characterize this anyway you’d like, but the matching funds is not a gimmick…it’s a partnership. The cities that pass this bill are saying our citizenry is willing to increase construction projects in the city which will increase employment in the construction field which will improve the overall state economy in lieu of the state helping out with some funds. It’s a partnership. Any city in the state can have that partnership.
Anne — I think you’re addressing whether Newton voters would elect to apply the surcharge that is being proposed? If this surcharged is made law, why wouldn’t we elect to enter into it? If we did not, we would be sending a portion of our state income taxes to those communities that did elect into it and not get a benefit out of something that we are committed to funding with or without state contribution.
Hoss – what I’m addressing is that there will be 1 fight to pass this in the state house (and convince the state to set matching funds aside out of the limited pool of income tax) and a 2nd fight to pass this in Newton. Now, should we succeed in both of those efforts it would STILL be insufficient to fix Newton’s infrastructure. Unless the state is offering a 15:1 match.
My argument is that this isn’t enough money. And since it isn’t enough money, spending the political capital to get it though could hurt Newton’s infrastructure in the long run. Mainly because to get it passed you’re going to have to convince the average- and low-information votors that this will FIX the problem; it won’t.
So – if the state is kicking in at 15:1 with a 1% surcharge, 2:1 with 4%, 1:1 with 8% , or 1:2 with 10% – then I can support it wholeheartedly because THAT would be enough money. Of course, if it’s enough money to get something done I’d expect my income taxes to increase to give the state the money…
Anne — I see your point, however the 15:1 math works only because we’ve neglected this type of spending and this proposal encourages it. So a generation from now we should find that the proposed subsidization level fits nicely. Again, it’s a re-allocation of funds such that the smart taxpayers benefit on something they will do anyway. It’s even better than watching lottery players scratch away my tax dollars
So then the question becomes: what’s our expected annual commitment?
Looking at the road replacement costs and map in the capital plan (which doesn’t even address all of our roads with a condition under 60); I can easily see Newton spending $2.5M annually to just “keep up” with the wear and tear
Water & Sewer – this is $57M in the plan (let’s say $10M annually) and shouldn’t need to be re-done for about 50 years. However – the replacement schedule map goes out 10 years to 2022. So it’s really going to be more like $100M when all’s said and done. Annualized over 50 years – about $2M
Buildings are the biggest item in the plan – so let’s ignore the outstanding repairs and estimate what it would cost to keep them ship-shape. The city has 2.5M square feet of building space across 78 buildings. If we use the guideline of you should set aside 3% of your housing cost for repairs/upkeep/upgrades every year and assume a conservative value of $300/SF for city buildings, we’d need to come up with 2,500,000 SF x $200 $/SF x 0.03 = $2.25 M annually (although it could be double this).
Rolling stock needs to be replaced, depending on the type, in 5-15 years. The plan calls for $10M over 5 years, or about $2M annually. I’m not sure how much of this is backlogged from insufficient prior spending, so we’ll go with $1M annually
From the above we have $7.75M in annual infrastructure costs; throw in the parks, parking lots, etc. and $8M annually for infrastructure doesn’t seem unreasonable.
Therefore $2.5M – even matched to $5M – is not going to be enough to even maintain what Newton has. And we can’t deny that this isn’t going to fix what’s currently deficient without an override. So I stand by what I said; this isn’t a big enough fix to spend the political capital to push it through.
So Anne, you’re in line with Paul Coletti’s proposal.
Just to make sure people understand I have absolutely nothing to do with Paul’s proposal which is: He wants to go through Home Rule Petition which means he needs 2/3 of the BOA’s support plus the Mayor’s support and then it goes through the state legislature and what he wants, is up to 2 1/2% of everyone’s property taxes, instead of 1% and since a home rule petition is for a single city, I would imagine less likely to get matching funds. Remember, the CAG recommends that the city should spend 6% of the budget on infrastructure and we’re only paying roughly 3 1/2 now..so the 2 1/2 would get us up to or close to the 6%.
This is my last post, really.
This is just an idea folks; one way of looking at how to solve a sizable problem. It is folly to think that infrastructure will be addressed without more revenue. With union agreements in place, and the school population increasing, there is not much left to be squeezed out of the budget.
So, other than choosing to let the City crumble, we need to start moving toward infrastructure rehabilitation. I like this idea because it provides a fixed revenue stream for infrastructure, while we would reserve the option to do some sort of override if necessary. However, we have to first figure out scope and prioritization before we head down any path. But this is as good a point as any to start the conversation.
You know, this tiny plot called Massachusetts is fairly good shape. In a global comparison – Massachusetts does very well. Critical infrastructure is what separates Massachusetts from many other less comfortable global areas. Yet pan this focus from globally to USA and I see decades of politically motivated decisions in Massachusetts that put us at a vulnerable situation compared to other areas in the same government. We aren’t far from Louisiana and Rhode Island in terms of political motivation and down right corruption — three felons for house leaders says a lot.
So seeing that someone wants to develop motivation for Massachusetts to direct funds to water, waste, schools and similar things where other global sections do not and in fact, we in Massachusetts are badly neglecting ourselves, attracts me. I say this only for us neighbors to stop thinking NEWTON in this water/waste/schools proposal and start thinking MASSACHUSETTS. Let’s clean up our legislative proposals such that they benefit each and every one of us, rich and poor, and not only those that lobby and befriend leadership and political types
nothing more than a political sucker punch to Ruth in leveling the mayoral playing field. Setti will have to bite the override bullet come reelection time and doesn’t want to die of lead poisoning alone. Now quit the sensationalism and get real – we live in a tax and spend liberal Dem city with grandiose $ 200 million eyes and small stomach indebted bonding capability.
Tom is trying to argue in support of something that in truth makes no sense. It’s simply another avenue for taxation which, once it’s in existence, can grow much more easily. The problem can be solved with some sort of an over-ride, if the residents of Newton think it’s worth it. That’s the purpose of Proposition 2 1/2, to force residences to think about where their money is going and then vote on it, up or down.
The matching funds will not magically appear from some generous philanthropist. It’s tax money we have paid to the state, and all cities and towns will vie for a share of it. Given that incomes in Newton are much higher than the average in Massachusetts, we probably will get a disproportionately small share of the matching funds, compared to the state taxes we pay.
Balser never saw a tax that she didn’t love. It’s amazing, because she, her friends, and any relatives she has here must pay them as well, but I guess this doesn’t bother her.
The real solution is not to allow projects like NNHS ever occur. Tom’s argument that our current needs will triple in cost if we wait, just like NNHS, is specious. That went up as features increased, and because the original estimates were lies anyway, not due to inflation over the time during which it was being considered.