A m e r i c a n P o s t – G a z e t t e
Distributed by C O M M O N S E N S E , in Arizona
Friday, August 3, 2012
Special interest lobbyist dupe Legislature! (again)
A proposition will be on the November ballot that will change the way property is taxed, but it doesn’t appear to do anything worthy of changing our constitution. The first thing that quickly becomes obvious is that this proposition, identified as Prop 117, does not reduce property taxes or limit the ability of taxing districts to levy taxes. If it passes it will require all taxes, both primary and secondary, to be levied against the limited property value (LPV), and increases in the LPV would be limited to five percent per year.
The Lincoln Institute of Land Policy, an internationally recognized private institution, published a comprehensive study in 2008 of the problems associated with limiting property values. Their study not only makes a strong case that this is a deeply flawed means to counter rising property taxes, but can result in shifting higher taxes to residential property. You can read excerpts of the report at: http://www.lincolninst.edu/pubs/1412_Property-Tax-Assessment-Limits
Based on a recent Capitol Media Services article by Howard Fischer, The driving force behind this proposition is the Arizona Tax Research Association (ATRA). ATRA acknowledges in the article that this proposition does not reduce property taxes. This excellent article by Mr. Fischer can be found at: http://verdenews.com/main.asp?SectionID=1&SubSectionID=1&ArticleID=48703
Prop 117 began in the State Senate as Senate Concurrent Resolution 1025 sponsored by Senator Steve Yarbrough. You may recall Yarbrough was taken to task earlier this year in an Arizona Republic editorial for “lining his pockets with taxpayer money”. You can find the editorial at: http://www.azcentral.com/arizonarepublic/opinions/articles/2012/03/05/20120305taxpayer-money-senate-finance.html
That editorial pointed out that Yarbrough has sponsored many revisions to the state’s tuition tax credit law that created middle-man organizations to manage the flow of $43 million from taxpayers to students. These middle-men are called School Tuition Organizations (STO), and the good senator runs the second largest STO in the state. STOs are allowed to take 10 percent of the money it channels to students as administrative cost. Guess who put that provision in the law. Another Yarbrough law passed this year doubled the amount individuals can direct toward tuition scholarships thereby doubling his salary that is reported in the editorial at $96,000.
Knowing how the system works, Senator Yarbrough had to have lots of help from ATRA to pass all of his pocket-lining STO laws. Why does ATRA care about Prop 117? Well, if the Lincoln Institute is correct that value limits will cause taxes to shift to homeowners then the property taxes on ATRA members will be less as they are all owners of high value properties. Therefore, they are happy to help Senator Yarbrough line his pockets with his STO legislative changes and he likely returned the favor by sponsoring this sneaky tax shift that could benefit ATRA members.
ATRA and their many lobbyists are masters at “helping” legislators accomplish their goals especially if they are self-serving. They know that somewhere down the road they can call in the chips when they see an opportunity to benefit their members. No doubt that a comprehensive audit of ATRA would reveal that their members have received billions in tax breaks as a result of their influence in the state legislature. Where does a large chunk of ATRA members tax saving go – out of state. What we have is an organization that effectively moves homeowner property taxes to out of state investors.
Any homeowner who thinks Prop 117 will reduce their taxes might want to reconsider. On the one hand you have ATRA and Yarbrough, with records of self interest and enrichment, saying it will help homeowners and on the other hand you have an internationally recognized independent organization saying the opposite is likely. So, take your pick and cast your vote.
Arrrggh. This is indeed the era of screwing the average citizen. Everything we cherish is being taxed, dismantled, regulated or destroyed. I am so mad I could spit rivets. We need to bang some heads together. I don’t know about the rest of you, but I have absolutely had it with what is happening to us. It is time to get ugly I think.
Now I’ve seen it all. An SA poster attacking ATRA, and then Yarbrough, then ATRA, then Yarbrough again. Yarbrough? Are you kidding?
People, heed the “Alliance ” in “Sonoran Alliance” for once. A compendium or amalgamation of various disparate interests aligned for a common purpose. Team, in short.
If you have a problem with ATRA, and with Yarbrough, you got a problem.
This is one of the most misinformed posts I’ve ever seen on SA. ATRA sought Yarbrough as the sponsor of SCR1025 because he chairs the Senate Finance committee – no big mystery there. If someone else was chair, they would probably have been the sponsor. Trying to talk down Prop 117 by misrepresenting the facts re: the STO issue & Yarbrough is the weakest debating tactic you could possibly attempt. Not to mention that your “facts” about him & his STO are way off base.
Efforts to create a legally defensible school choice program and the property tax issue have ABSOLUTELY NOTHING to do with each other. Yarbrough did NOT sponsor the STO expansion bill – Murphy did. Yarbrough’s salary from the STO does NOT change when more scholarship money comes in, but many more kids DO get scholarships with the 95% his STO spends on kids (yes, his STO far exceeds the minimum standard – it’s public record). Not to mention the fact that Yarbrough has consistently cosponsored & voted for voucher bills, which bypass the whole STO process. Ironically, the liberals who complain about the STO admin expenses FORCE the necessity of them by suing to stop the voucher programs that would make STOs unnecessary!
Bottom line: If you’re going to oppose Prop 117, fine. Please just do it in an intellectually honest fashion that relies on the relative merits of your position rather than Alinsky-style “reasoning” & unrelated attacks.
Look ATRA trolls! Love the defence of Yarbrough. The article just quotes others that talk about his past enrichment schemes. Who cares who or why this was introduced. It a stupid idea. Even ATRA admits this will not reduce taxes so why are they doing this?
The Lincoln Institute of Land Policy has no dog in this fight and they say this is a bad idea. This will shift the tax burden to the homeowner. I don’t know about yours but, my taxes are high enough already. Read the fiscal note on SCR1025. Did anyone talk to subject matter experts of just lobbyist? This is a really stupid idea.
Vote NO on Proposition 117
Published in the statewide Voter Informational Pamphlet
November 2012 election
Vote NO on Proposition 117, Property Tax Assessed Valuation.
Prop 117 does nothing to limit your property tax bill or annual tax increases.
Prop 117 just pretends to offer property tax relief or reform. It lacks any restraint on tax rate increases so does nothing to curb how much money taxing districts can collect from you. It still allows the addition of new taxing districts, more debt, and higher tax “overrides” to your bill.
The Legislature put Prop 117 on the ballot and at the same time came close to passing HB 2405. Passage would have allowed every school district in the state to double their bond debt capacity which would then double the 2nd largest item on your property tax bill. Many in the Legislature are working to raise your property taxes, not limit them.
Prop 117 is proof that property tax reform won’t come from the Legislature. We must do it ourselves using the initiative process.
Prop 13 Arizona, a Citizens Initiative for the 2014 ballot, is the reform we need. It uses purchase price (or decline-in-value provisions) as your tax basis, limits valuation increases to no more than 2% per year, and caps your total tax rate at 0.5% for all residential property or 1% for all other real property. No parcel taxes, overrides or exceptions to the tax caps.
Prop 13 Arizona provides plenty of tax revenue for the government, just not unlimited tax increases as the current system allows. It puts family budgets first, not government’s desire to tax and spend without limit.
Vote NO on Proposition 117. It does nothing to fix our broken tax system.
Lynne Weaver
Prop 13 Arizona, Chairman
Phoenix
The bottom line on 117, no matter who supports it, calls for the shifting of tax burden on to the middle class homeowner!
What else is new?
Why doesn’t someone, somewhere start slashing the spending which is at the bottom of the tax burden?
This article couldn’t be more misleading. ATRA is a taxpayer watchdog organization and to argue that ATRA would propose something that is harmful to taxpayers is absolutely absurd.
The main opposition to Prop 117 is coming from the property tax consultants who charge taxpayers contingency fees based on the amount of “savings” they can generate when the assessor overvalues their property (and benefit the most from our flawed system) and the advocates of California’s Prop 13 (those that don’t care about what a measure like that would do to our system or the citizens of Arizona).
If you follow the link to the referenced report, it does talk about a tax shift between residents as a result of implementing a Prop-13 type of reform. Prop 13 is an acquisition-based system that causes huge tax shifts among its taxpayers. Prop 117, however, is not an acquisition-based system. Anyone who knows Arizona’s property tax system understands that the only way to shift taxes among its residents and businesses is to change the assessment ratio between the different classes of property and Prop 117 does no such thing.
Unlike Prop 13, Prop 117 will limit the annual value growth of all locally assessed property to 5% whether or not the property sells or transfers ownership. Locally assessed property does not include mines and utilities (centrally assessed property). However, all property taxpayers will benefit from the stabilizing effect of Prop 117, which eliminates the whipsaw effect that huge fluctuations in values can have on tax rates. For example, as market values climbed 95% between 2004 and 2009, many taxing jurisdictions kept their tax rates the same and caused huge tax increases. Since the collapse of the real estate market, property values have resumed to 2006 levels. However, if Prop 117 had been in effect during that time, it would have prevented $33 billion in value from being added to the tax rolls that was ultimately removed.
Arizona’s property tax system already has in place levy limits on the maintenance and operation budgets of counties, community colleges, cities, and most recently, fire districts. For those levies that don’t have limits, the majority do have tax rate caps. Prop 117 will help to complement the existing levy limits and tax rate caps that are currently in place in Arizona’s property tax system.
ATRA is a lobbyist group that lobbies for paying clients, some of whom want higher taxes or tax revenue carve-outs. ATRA is not a group working to lower or limit your taxes. They work for clients.
Jennifer – you are either a liar or severely misinformed. ATRA is a lobby group. The only taxpayers they care about are their members. You are probably one of them. Try getting their membership list.
The ONLY way to reduce property tax is to reduce the levy. This only shifts the burden to homeowners from business. Reducing tax on business is a good thing, but not if it pushes it to already stressed homeowners. This does not reduce property tax. Even your god Mccarthy admits that:
http://azleg.granicus.com/MediaPlayer.php?view_id=7&clip_id=2327
Move slide bar to 1 hour 8 minutes (1:08:00) to watch the video of Kevin McCarthy’s statement below.
Why SCR 1025 does nothing to limit property taxes –
Kevin McCarthy, ATRA, in his own words:
“One of the reasons why for ever since I’ve been doing this somebody runs a measure to put on the ballot some significant limitation on growth in value. Instead of a 10% limit its going to be 2 like Prop 13. Local governments don’t show up and oppose that. Why? They couldn’t care less. If you don’t do anything to limit their take on revenue they’ll just adjust the tax rate. The notion that they are that spooked about raising the tax rate is a misnomer. They’ll increase the tax rate if they have the ability to do it and grow the levy so short answer is yeah, that is actually built into the system. That’s the way the toggle works.”
SCR 1025 is that measure being put on the ballot to limit valuation growth, exactly what Mr. McCarthy describes as an inconsequential action. “…they’ll just adjust the tax rate.”
SCR 1025 does nothing to limit tax rate increases.
SCR 1025 does nothing to limit the levy.
SCR 1025 does nothing to limit your property tax bill increases.
VOTE NO! Then demand your legislator get their collective heads out of the dark place they keep it and do some real reform.
Roger, I am the Vice President of ATRA and we do lobby on behalf of taxpayers at the capitol. Taxpayers benefit from the reforms that we advocate for whether or not they are one of our members, which we have over 400.
I don’t know who misled you but Prop 117 absolutely does not shift taxes from businesses to homeowners. And if you read my previous comments, I correctly stated that Prop 117 will limit the limited property value (LPV) to 5%, which will be the only taxable value (No longer will property be taxed on its market value). The reforms of Prop 117, coupled with the existing levy limitations and tax rate caps, will add greatly to the stability of our system.
This measure would have never received the bipartisan support it did if your analysis were accurate. The only opposition to 117 is from the property tax consultants who charge property owners on a contingency-fee basis, and therefore, profit the most from the current system and local governments that benefit from huge valuation increases.
Prop 117 has widespread support from numerous organizations, which includes the Arizona Association of Realtors, Arizona Farm Bureau Federation, National Association of Industrial and Office Properties (NAIOP), Home Builders Association of Central Arizona, Arizona Chamber of Commerce, Arizona Cattle Feeders’ Association…and the list goes on.
Here’s the “existing levy limitations and tax rate caps” Jennifer Stielow, ATRA, refers to. As you can see, with all the exceptions listed there are no limits. Those who want to tax and spend always trot out these “limitations”.
Quote is from the Arizona Constitution, Article 9, Section 18 -
18.¦¦Residential ad valorem tax limits; limit on increase in values; definitions
Section 18. (1) The maximum amount of ad valorem taxes that may be collected from residential property in any tax year shall not exceed one per cent of the property’s full cash value as limited by this section.
(2) The limitation provided in subsection (1) does not apply to:
(a) Ad valorem taxes or special assessments levied to pay the principal of and interest and redemption charges on bonded indebtedness or other lawful long-term obligations issued or incurred for a specific purpose.
(b) Ad valorem taxes or assessments levied by or for property improvement assessment districts, improvement districts and other special purpose districts other than counties, cities, towns, school districts and community college districts.
(c) Ad valorem taxes levied pursuant to an election to exceed a budget, expenditure or tax limitation.
Roger, I emailed the information you posted to Legislators before they voted on SCR 1025, now Prop 117. They knew it did nothing to limit property taxes.
Jennifer Stielow is the Vice President of the Arizona Tax Research Association (ATRA), and a member of the school facilities board. The question is did she get on the SFB to push ATRA’s agenda? Looks like that’s a big yes!
If prop 117 passes, it will reduce the schools ability to bond. That’s something the unions and schools will not like. It will also increase tax on homeowners. That’s something they won’t like. Looks like the only people that benefit are ATRA members.
Jennifer – your lies don’t hold water. McCarthy even admitted 117 will not reduce the levy. Levy = tax. Therefore if you aren’t reducing the levy what are you doing? A look at who you listed as supporters might shed some light on that question. 117 shifts the tax from your clients (commercial) to the other classes, mostly residential. So while 117 doesn’t increase the levy (taxes) it will have the affect of raising the share homeowners pay. Anyone wonder why taxes didn’t go down when your values fell through the floor? Like McCarthy points out, they just raise the rate.
There is no doubt taxes are too high and going higher. The only way to reduce them is to get rid of the waste in the schools. Then you can reduce the levy. Money doesn’t equal better schools. If it did D.C would have the best schools in the country instead of the worst.