GUEST OPINION: Utility tax designed to dupe city taxpayers
The City of Spokane contends that its utility tax is 20 percent. So, if a resident uses $100 worth of water, grade school math tells you that adding 20 percent for the tax will bring the total to $120, right?
Wrong! The actual bill amount is $125.
How did 20 percent of $100 become $25? City officials call the process gross up. Twenty percent of your $125 bill, they explain, is $25. Bingo!
The way these characters at City Hall play this shell game is: when paying your water bill, one would think for $125 you are receiving service for that amount. Nope! The user is only receiving $100 worth of service (actually less than that because the state of Washington sucks out the state utility tax).
The 20 percent figure given for the tax is merely an untruth by the city. I have observed these lies since being annexed into the city of Spokane in 1989. I am still angry about the deception.
Most city utility users have no idea how much the Spokane city utility tax is. This is obscene and criminal.
Well, citizens of Spokane, the employees we pay at City Hall are pilfering our pocket books. The 6 percent city utility tax on your Avista and telephone billing is also leveraged up, even though state law restricts the tax on an electricity bill to 6 percent. You are charged an effective rate of 6.38 percent, although the city would have us believe it is 6 percent.
Your cable TV billing shows city utility tax in Spokane at 6 percent, but they add another 6 percent city franchise fee. Talk about blindfolding the citizens from the facts. The city grosses up the city utility tax portion to 6.38 percent.
Has anyone wondered how much they actually pay in city taxes? Peruse your City of Spokane utility billing; it lists water, sewer and garbage, reserve accounts, stabilization costs, etc. Included is a 25 percent effective city utility tax, grossed up from 20 percent.
Note that the city utility taxes for these services are not itemized, as your private city utility billing is. Why? It’s a continuing theft of your money.
I have taken much time to study other cities relative to both utility rates and local taxes. I’ve found that the utility rates are mixed, some cities higher and some lower. To my knowledge, however, Spokane has the highest city utility tax in the nation.
Spokane officials love to compare apples to oranges. They tell us how much higher the actual water rates are in Seattle, but they don’t mention that the Seattle city utility tax is relatively small by comparison with Spokane.
We love to be number one, but not in stealing money from our residents for life’s necessary services. I think it’s a crime that Spokane`s city utility taxes are the number one source of tax revenue.
Gavin Cooley, the city finance officer, uses smoke and mirrors to imply otherwise. He treats utility tax collections separately, depending on whether they’re assessed on public or private utilities.
About a year ago, I sent Cooley a note, telling him he was misleading the citizens and City Council by not showing the grand total of all city utility taxes during his dissertations at council meetings. Then there would be no doubt about the number one source of tax revenue for our city.
By his calculations that year, the property tax accounted for 24.89 percent of revenues, sales and use taxes 22.34 percent, private utility tax 17.42 percent and city utility tax 13.4 percent.
The only thing I asked the city to do was total both utility tax entries, which would work out to 30.82 percent. That is almost 6 percentage points higher than property taxes generate.
The saying, if it walks like a duck and quacks like a duck, it is a duck, is not true at City Hall. They know knowledge is power, and they would rather dumb down the utility users.