Tuesday, April 24, 2012

Oversold (Tuesday LINKS)

I may have been premature in expressing my support for an increase in the fire tax.  Regretfully, I jumped the gun based on incomplete data and a misunderstanding of the numbers I was looking at.  That's not to say that this proposal does not have merit.  I am simply criticizing my own failure in skepticism and recommending a further review of the facts.

There is an a lot of important data in the Comprehensive Annual Financial Reports for Howard County, which look past the budgeted amounts for County expenditures and get right to the heart of "what does it cost?"

For instance, in 2009, the Fire Tax brought in $65.8 million.  Public safety expenses were $52 million, but there was a transfer out of $9.5 million, leaving the total Fire and Rescue budget at negative $6.6 million after drawing down $2.8 million from the reserve balance.

In 2010, the Fire Tax brought in $68.8 million.  Public safety expenses, although budgeted at $72 million, were only $56.2 million.  There was a transfer out of $2.4 million, leaving a surplus of $10.3 million that was put in the reserve fund.

In 2011, Fire Tax revenues were $66.4 million (further indication of the volatility of this revenue stream).  Public safety expenses were $60.2 million.  There was a transfer out of $2.9 million and yet another surplus of $3.4 million.

Between 2009 and 2011, the Reserve Fund Balance has increased from $8 million to $22.2 million.

In light of all this, the proposed increase may be premature.  What is certain is that the volatility of tax revenue needs to be stabilized, which should be accomplished with the imposition of a homestead tax credit.  If I can get in the head of County leaders, I think that was the original goal here.  Once that was determined, the next concern was that the tax credit would effectively "slow down" fire tax revenue at a time when the market is already low and stagnant.  Hence the increase in the base level tax. 

I'm not sure what mechanisms or laws need to be implemented, but I think the real solution here is the stabilization of revenue.  Based on what I've seen, I'm not sure that the tax needs to be increased, at least not now.  The Reserve Fund is at nearly 30% of total expenditures, which should protect against any short term fluctuations, and the increase in tax in the West would be expected to put revenues in excess of expenses, assuming there has been no dramatic increase in expenses since 2011.

But I learned my lesson yesterday.  I'm not jumping to any conclusions.  I do know that skepticism brings you more information than acceptance. 


Jessica Anderson has a good piece on Bridge Columbia, its proponents, and the concerns raised by some about its overall utility.  I'm excited about Bridge Columbia because my friends are excited about it.  That's what makes this project dangerous.  It is a capital project based on aspiration, ideals, and popular support.  As far as I know, there was never an urban planner that came to the Executive and said, "your costs and transit burdens would be lessened X amount if you build this bridge", which, quite frankly, is the reason most other bridges, roads, and pathways are built.  That's not a knock on my Bridge peeps.  I love my Bridge peeps.  But I think we should be careful and make sure this is a good use of tax-payer money, not just in ideals, but also in practical ways that can be measured with a dollar sign.

The Political Left yesterday morning: "There is no media bias."  The Political Left yesterday afternoon: "Yes, there is a media bias!  It's against Obama!"

Long term tax discounts for development projects in Baltimore are very controversial amongst the Baltimore City politerati.  I think we all would do ourselves well to follow these stories, as I think we can expect similar tax deals to be sought, and granted, in Columbia and the surrounding areas as we become more "urban."

The Port of Baltimore had the fastest growing cargo volume in the United States last year, growing at 15%.  This is expected to further accelerate with the expansion of the Panama Canal in 2014.

While Lee Evans might have dropped that pass, the Ravens are about to own Boston in a much more concrete way.

Featured Blog Post of the Day: Well & Wise further develops the idea that bullies are not third parties that we need to seek out and destroy.  This is an important bit of dialogue that we need to have if we are going to have any success in addressing the bullying problem.  I appreciate the link and want to keep the blog synergy going.

That's all for today.  Have a fantastic Tuesday doing what you love!