The City of Madison has put off a public vote on its new special maintenance fee... by rescinding the special maintenance fee. I generally get cranky when citizens are denied a chance to vote. One of my correspondents expressed concern that a special election would cost the city money. However, Gale Pifer reports that a referendum would cost more than $2,000. That's a small premium to pay on $386,000 in new property taxes, as well as the opportunity to legitimize said taxes with a popular vote. Besides, we could cover that election cost simply by asking Custom Touch to pass on the city's kickback on a couple of its houses.
But I'll hold off a bit on bawling out Mayor Lindsay and the Madison City Commission for anti-democratic sentiments. They are at least responding to public criticism with changes in policy:
According to Lindsay, he and the city commissioners would consider making adjustments to the original special maintenance fee proposal during the next two weeks. He outlined one proposal that would assess a special maintenance fee of $2 per foot for up to 50 feet of property per lot. Lindsay's adjusted fee formula would effectively cap the fee at $100 per piece of property that is at least 50 feet wide.
Lindsay said the capped fee formula would raise about $270,000 annually, and it would still need the commissioners to vote each year to enact it [Chuck Clement, "City rescinds street maintenance fee, officials expect a return to funding issue," Madison Daily Leader, 2013.06.24].
O.K., I'll tweak the city a little. I appreciate the city commission's desire to seek tax alternatives more palatable to the public. But I wonder: would it be so bad to hold the vote? Sure, petitioners got 525 signatures asking for a vote. But there are over 5,000 registered voters. If darn near everyone agrees that Madison's streets are the pits, a majority might well give the special maintenance fee their stamp of approval. A yes vote makes the city look golden. A no vote still makes the city look golden: Mayor Lindsay gets to say, "The people have spoken!" and then present his capped fee formula as Plan B.
Unsatisfyingly unanswered is the question of whether any special maintenance fee, capped or not, can be referred to a public vote. That was the pretext under which the commission stalled on certifying the referendum petitions last week, saying they wanted the Attorney General to explain whether the special maintenance fee is legislative (referrable) or administrative (non-referrable). AG Marty Jackley apparently hasn't gotten back to Madison on that question. The 2012 law authorizing special maintenance fees seems to make clear that citizens can refer such fees to a vote, but it would be nice to have AG Jackley tell Madison so... so that I could tell Madison "I told you so."
A friend owns a flood lot on a gravel road with an assessed valued of $175. Basically no value, but with this collection method he'll pay $100 a year. Prostrollo's Motors, or a house assessed at $200,000 would also pay a maximum of $100 a year. The inequity is staggering. By not using the assessed values it pushes the burden down and the $100 cap actually extends that burden to the lowest value properties.
They will never keep everyone happy.
Yes, but some things shock the conscience. We have historically collected revenue based on assessments, so this would be a huge departure with the bottom end picking up more of the tab.
If the statute below applies, I don't think a cap would be allowed, and further each lot would have to pay directly for the improvements collected by the specific assessment. Or have I read it incorrectly?
9-43-79. Assessment according to special benefit. In lieu of the method prescribed in § 9-43-78, the governing body may provide by resolution that the costs of the local improvement shall be assessed against all lots and tracts according to the benefits determined by the governing body to accrue to each lot and tract from the construction of the improvement. In such event the governing body shall make an investigation and shall determine the amount in which each lot and tract will be specially benefitted by the construction of the improvement and shall assess against each lot and tract the amount, not exceeding the special benefit, as is necessary to pay its just portion of the total cost of the work to be assessed.
I would have expected it to be based on assessed property values as well. I think we will see a petition regardless of how they decide to assess the fee. I don't think they are going to let any fee/tax go through without a vote.
Our city attorney contends it is an administrative action and a petition can not be made, so we will have to see how the city commission moves forward.
"I don't think they are going to let any fee/tax go through without a vote."
"they" was in regards to the petitioners. That was just the impression I got from the person trying to get signatures. I believe this person was on a fixed income so they would fight against any fee/tax.
John, your gravel lot vs. Prostrollo's example puts the unfairness of a capped fee in great context. Hmm... I wonder, should we just put a toll booth at the end of everyone's driveway? Or, if we really are trying to assess a fee in proportion to benefit, how about a municipal gas tax?
John - I am not sure how the value of what is on the property should affect the amount of the "fee". If the fee is for road improvements, it should not cost more or less to improve roads based on the assessed value of the property. People who own land abutting a road should not be solely responsible to bear the costs for improvements to the roads. Everyone vehicle in Madison can drive on any road in Madison, so shouldn't a "fee" be placed on vehicles registered in Madison rather than on the land abutting the roads?
Jim, I would suggest John's point on unfairness remains valid: Prostrollo's business depends on streets more than others. But I will agree that if we're trying to target street users for street repairs, a vehicle-based tax makes much more sense than a land-based tax. Of course there, we may need to get into the proportionality our friend Doug Wiken has often mentioned, noting that big trucks do a lot more damage than typical cars.
Cory - I read John's comment and came away feeling he was concerned with the value of the property, not the amount of business done at the property. He mentioned a $200,000 house and Prostrollo's, along with a $175 lot. Basing the fee on the value, or amount of business done, does not seem right, nor does placing the entire burden on property owners, no matter what the value of their property is. I drive on the roads that abut Madison's businesses, but I don't drive on them for the sole purpose of doing business. Placing a tax on vehicles seems to me to be the fairest way, but not the easiest. What about all the vehicles the college students drive? They are not registered in Madison, but they use our roads. Would it be easy to add a fee of a penny per gallon of gas purchased in Madison?
I can still see the possibility that it would be fair to assess a higher tax on a business that puts more cars on the road than on some guy who has an empty gravel lot that doesn't draw traffic.
That said, you are very right to talk about all the college kids who get out of paying that tax directly (although landlords will pass on their tax in the rent). A city gas tax would access some of the money of users... although people can dodge a local gas tax by fueling up in Colman or Winfred. I'm not sure if cities have authority to add a local gas tax to the state's 22-cent gas tax. We can add municipal taxes on bed, booze, and other tourism-related stuff; why not gasoline?
I'm next to positive that there is nothing in state law that enables a city to withdraw a motion / resolution / ordinance that has been passed and referred to a vote by the citizens... The legislature just gave itself the ability to do so two sessions ago, and left out any inclusion of muni governments... This move runs afoul of the referendum law.. These people should still get their vote..
...Cities cannot add to the gas tax. Cities are between a rock and a hard place when it comes to funding roads. The front footage that Madison was exploring here can only be used for maintenance and not new roads and has to be re-applied with a vote every year. Special assessments to adjacent property owners is an option but piles a lot of burden on a few people. Opt Outs excuse the cities and schools from paying for projects.. It is time for the legislature to address this and give cities a road funding mechanism..
Hey, Planning Student, which bill was that you cite? And is there a specific statute in Title 9 (the municipal gov't statutes) that says submission of referendum petitions freezes an ordinance until the public votes? And if the city delayed certifying the petitions, does the city still have freedom to rescind, since a referendum isn't on until the petitions are certified?
It was a deb peters bill? in 2012...
http://legis.state.sd.us/sessions/2012/Bill.aspx?Bill=93
"Pending the election, the governing body may take no action with respect to the subject matter of the petition that would alter or preempt the effect of the proposed petition."
http://legis.state.sd.us/statutes/DisplayStatute.aspx?Type=Statute&Statute=9-20-11
I think that's what you're looking for... Sorry for the multiple posts. The Peters Bill, SB 93, seems to only apply to the legislature's ability to back step from a referendum; while 9-20-11 seems to clearly say you can't do anything to change the occurrence of an election after the petition has been acknowledged..
Surely if it was as easy as back pedaling, Sioux Falls and many other munis would have done so before; think Shape Places in SuFu right now.
I love it when readers help research! PS, the Peters bill you point to does not appear to empower the Legislature to cancel a referendum (hey, remember when they tried to do that with the Governor's Large Project Fund during the 2012 session?). It says "two-thirds of the petition sponsors" can "file with the secretary of state, in writing, their request for withdrawal of the question from the ballot" up to 120 days before the general election. And you're right, that applies only to state-level referenda.
You also may be right about the municipal statute. It ties the city's hands upon presentation, not certification, of the referendum petition.