“It’s Only……”

Last week the Palm Bay City Council voted 3-2 to increase the storm water fees that residents pay. The average increase seems to be roughly three times the amount property owners are paying now.

Prior to the vote, the Council sent out letters to property owners advising them of the proposed change.

One of the points raised in the letter was this one:

Why use special assessments to fund stormwater management services?

The use of special assessments requires the City to meet the Florida case law requirements for a valid special assessment including fair and reasonable apportionment. This means that unlike taxes, which can be used for any general purpose, the revenues collected through the stormwater special assessment can only be used to fund stormwater management services like ongoing maintenance of City-owned storm drainage infrastructure, as well as water quality monitoring, evaluation and improvements.

If it weren’t so sad, we’d be laughing. This is essentially saying “because we can’t stick to a budget where funds are allocated to certain line items, we want to have you pay more for our lack of fiscal responsibility and discipline.

However, there is a much more damning reason for the assessment fees as opposed to a tax.

Palm Bay has an ordinance that requires taxes to get approval by the voters. By in effect admitting the City cannot spend responsibly, they certainly don’t want voters to have a say in the City taking more money from the voters’ pockets.

(Let’s be clear about this too – while there is a legal technical difference in a fee and a tax, that difference is not known to peoples’ wallets, pocketbooks and bank accounts. To the citizen, the money is coming out of the same place. It is the government who determines where it will go.)

People showed up in droves to the City Council meeting. So many people showed up that the City had to make provisions to have people hear the meeting outside of the building because the Council Chambers were overflowing with people.

In addition, if one looks at the agenda packet, (found here) you’ll see that there were lots of letters and emails written to the City.

This was an issue that had raised the ire and the passions of city residents so they communicated and showed up to communicate in droves.

The vast majority of people voiced their displeasure at the increase. The City website has a page devoted to “participating” in the City and City government and people did just that.

They participated.

And for that participation and raising of voices and concerns, the City Council said “huh? We can’t hear you and are voting to raise the fees.”

Councilman Brian Anderson was one of the three Council members who voted for the increase. Anderson had this to say:

Stormwater is a real problem,” Anderson said. “It takes guts to vote this through because we have to.”

What kind of “guts” is Anderson talking about?

It takes “guts” not to listen to the people? That kind of “guts?”

It takes “guts” not to spend within the budget? That kind of “guts?

It takes “guts” to circumvent the process the voters implemented for raising taxes by raising “fees?” That kind of “guts?”

Imagine if you will a person who has made bad choices all their lives. They dropped out of school. Can’t keep a job because they don’t show up to work. Would rather pay for a big screen TV rather than pay their bills. So without money they come up to you, pull out a knife and say “give me your money.”

Anderson would consider that person as having “guts” as it is hard to rob other people. It takes “courage” to demand more money from people.

And the only difference between the thief and Anderson is that Anderson is taking money under the color of law.

(We realize that is an extreme example and we don’t mean to inflame passions. We just don’t understand how it “takes guts” to reach into someone else’s pockets and say “give us more money because we can’t exist within our means.”)

However, the comment that riled us up the most was this one by Councilman Tres Holton.

Councilman Tres Holton said two-thirds of the residents are looking at a $10 a month increase to repair serious storm water problems. In what it accomplishes, it’s fair and responsible, he said.

We’re talking about two Little Ceasars pizzas,” Holton said. (emphasis ours)

(We wrote about Holton awhile back after he and Councilman Bailey got into a bizarre argument of Holton not listening to speakers while doing other things on his computer. Holton wants to codify listening and being polite into the Council rules, but did not demonstrate those proposed rules in his own actions. Holton seems to be a big proponent of “lead by fiat, not actions.” After the brief dust-up, Holton got up and walked out of the meeting, and did not participate or vote on any other issues. )

There are several economic issues with Holton’s statement on Little Caesar’s Pizza.

First, the people who want to buy a couple of pizzas often do so not because it is an extravagant or discretionary expense. For $10, a family of four can be fed a meal which isn’t too bad when you think about it.

Secondly, in Palm Bay there are two Little Caesar’s Pizza Shop. Both are franchises and considered “small businesses.” Small businesses revenues are anywhere from $100,000 to $5,000,000 a year.

According to the City of Palm Bay, the increase in stormwater fees will bring into the City coffers some $11,869,757.00.

That means that the money that would have gone to the two Little Caesar’s and instead is going to the City means the two pizza locations may have to close.

While that seems unlikely and a stretch, the bottom line is that there will be a net loss in the economy of Palm Bay of almost $12 million dollars. That’s the “base dollars” money.

Yet when governments give tax breaks to businesses, that break is always predicated on what is called a “multiplier effect.” That is where the money that is a tax break is said to go back into the area economy and expand at the rate of roughly 2.5 – 5 times per dollar in tax relief. The reverse must be true as well. For every increase in tax dollars, 2.5 – 5 times the amount is removed from the local economy.

We are going to be charitable here and work with the low end of those figures.

If one subscribes to the multiplier theory, the City of Palm Bay has just removed $30 million dollars from the local economy.

Think about that for a moment. The City claims there are $40 million dollars in unfunded storm water management projects but yet is removing 75% of that amount right out of the economy.

Last but not least, we are tired of the “it’s only” argument from elected officials when it comes to taxes.

When the lagoon tax was passed, it was sold as “it’s only…..” When the school tax was passed, it was said to be “it’s only….” You can insert whatever small thing you want in there. A coffee, a pizza, a Happy Meal, a dinner out…..

All those “it’s only’s” add up.

The Chinese had a name for it: death by a thousand cuts.

In addition to the “death by a thousand cuts,” there is also this argument. Cities and governments seem to think they know how to spend your money better than you do. There is a certain amount of hubris when a Councilman says “you don’t need a couple pizzas. We can spend that money better than you can. We’re taking it.”

For many people, $10 bucks is an hour’s work – or more.

It is a shame that people like Holton don’t realize or understand that simple fact.

It is easy to vote to take people’s hard earned money away. It is difficult to stand on principle and say “the people are paying enough and we need to be better stewards of their taxes and trust.”

P.S. To support the fee increase the City of Palm Bay made this little video:

It’s so nice that the City had to the time, money and resources (paid for by the taxpayers) to make this little piece of propaganda but the first two slides puzzle us to no end:

“Did you know….

Palm Bay’s Existing stormwater infrastructure is nearly half a century old.

The sad thing about this is that in 2010, the City passed a stormwater assessment fee to increase funding for stormwater projects. If the “infrastructure is nearly half a century old,” where did that money go?

The design of some parts of the infrastructure might be that old. Some of the actual pipes and drainage might be that old. (And we doubt that it is.) But the implication by the City in the video is that all of the infrastructure is that old.

It’s not.

So why does the City lie or misrepresent the truth right out of the gate?

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