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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Opinion

Property tax hike a necessary plan

The Spokesman-Review

For the longest time, the city of Spokane’s budget was a work of fiction, with a new chapter added each year. The real price of government was shrouded in accounting maneuvers that pushed costs into the future. The budgets balanced, but everything wasn’t paid for.

In recent years, the city has dropped the charade and instituted reality-based budgeting. The pain is palpable and relief is elusive, but at least citizens are getting an honest look at how much it costs to run a city and why.

In 2005, 125 general fund work-force jobs were cut, 75 of them in the police and fire departments. Library hours were curtailed dramatically. Some branches are open only twice a week. Health-care premiums for employees have jumped 95 percent over the past five years.

The city is looking at more of the same in 2006. Expenditures are expected to grow by 6.6 percent, while revenues increase 2.5 percent. The budget shortfall is estimated to be $6.8 million. Without new revenue, the city could lose 60 more firefighters and there could be further cuts from a police department that already can’t respond to many serious citizen calls, including some domestic violence incidents.

Many taxpayers wonder why the cuts are so sudden and deep. It’s partly because the city has lost some traditional funding sources, such as the motor vehicle excise tax, and delayed the day of reckoning. It’s also because fire and police unions enjoy collective bargaining leverage that enables them to exact lucrative contracts. Additionally, Spokane’s economy isn’t generating the kind of revenue needed to support existing services let alone those that anticipated growth will require.

Part of the city’s short-term solution is to ask voters to lift the state-imposed lid on property taxes for the next two years. Doing so would raise an estimated $6.6 million.

The city says it can forgo layoffs and return all library branches to five-day service if voters pass the November ballot measure and if the utility tax is raised from 17 percent to 20 percent and if employee unions accept $850,000 in concessions to lower health-care costs.

That’s a lot of ifs, but we don’t see better short-term solutions. Adding a local business and occupation tax is unwise for a border city that already struggles to attract and retain businesses.

The Police Department has been cut enough. Ask anyone who has reported a property crime. The Fire Department would probably have to close stations if it loses more workers. The part-time status of our libraries is an embarrassment.

We harbor no illusions about a short-term property tax increase. It is a Band-aid. The city needs to come up with reliable revenue sources or risk a steady erosion in services. Even the voter-approved street bond that has financed widespread improvements lasts only 10 years. Then it’s back to the voters.

Possible solutions include the annexation of businesses to expand the tax base, a local gasoline tax (the county would have to agree), collecting taxes on Internet transactions (Congress would have to agree) and getting a tighter handle on payroll costs to include salaries and health-care benefits.

We’re not wild about the property tax proposal, but the short-term alternatives are even worse. For the benefit of its citizens, City Hall needs this short-term infusion of cash. After that, all agencies need to demonstrate better, more frugal management. One chance should be enough.