<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html>
<head>
<meta content="text/html;charset=ISO-8859-1" http-equiv="Content-Type">
<title></title>
</head>
<body bgcolor="#ffffff" text="#000000">
Hi, Jed. You've been writing a lot, you deserve a response.<br>
Here's some more to think about. Numbers refer to numbers below.<br>
1. "tax" vs "fee." You need to explain how you would structure both the
tax and the fee (and are you using "tax" as a synonym for Special
Improvement District?) to make them equal. I don't know of a scenario
in which they would be equal, or why they'd need to be.<br>
2. <font color="#0000ff" face="Arial" size="2"><span
class="079504420-15022009"></span></font>a) "get around state law?" b)
"using the SID... to accomplish" etc.<br>
Would you mind explaining how using SIDs gets around state law? And
SIDs have been used by cities and counties for, well, at least 50 years
and doubtless many more.<br>
3. Jed, once again you need to explain how using SIDs, which are
explicitly allowed by state law, would be used "<font color="#0000ff"
face="Arial" size="2"><span class="079504420-15022009">to accomplish
things the state law currently prevents."</span></font><br>
4. It costs money to borrow money. I've never worked in a bank, but as
I understand it banks charge money when you borrow money from them. I'd
be glad to hear of a way to get around paying interest and fees to
borrow money, whether from taxpayers or from bankers.<br>
5. "state law forces the city to use sids?" Nope. See above.<br>
For what it's worth, I think the cost to individual property owners
paying for Pineview Park was: not much (in the neighborhood of a dime a
day).<br>
<br>
<br>
<br>
<br>
<br>
<pre class="moz-signature" cols="72">Ed Childers</pre>
Jed Taylor wrote:
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite"><!--[if !mso]>
<STYLE>v\:* {
BEHAVIOR: url(#default#VML)
}
o\:* {
BEHAVIOR: url(#default#VML)
}
w\:* {
BEHAVIOR: url(#default#VML)
}
.shape {
BEHAVIOR: url(#default#VML)
}
</STYLE>
<![endif]--><o:SmartTagType
namespaceuri="urn:schemas-microsoft-com:office:smarttags" name="City"></o:SmartTagType><o:SmartTagType
namespaceuri="urn:schemas-microsoft-com:office:smarttags" name="place"></o:SmartTagType><!--[if !mso]>
<STYLE>st1\:* {
BEHAVIOR: url(#default#ieooui)
}
</STYLE>
<![endif]-->
<style>@font-face {
font-family: Tahoma;
}
@font-face {
font-family: Verdana;
}
@page Section1 {size: 8.5in 11.0in; margin: 1.7in 1.25in 1.0in 1.25in; }
P.MsoNormal {
FONT-SIZE: 12pt; MARGIN: 0in 0in 0pt; FONT-FAMILY: "Times New Roman"
}
LI.MsoNormal {
FONT-SIZE: 12pt; MARGIN: 0in 0in 0pt; FONT-FAMILY: "Times New Roman"
}
DIV.MsoNormal {
FONT-SIZE: 12pt; MARGIN: 0in 0in 0pt; FONT-FAMILY: "Times New Roman"
}
A:link {
COLOR: blue; TEXT-DECORATION: underline
}
SPAN.MsoHyperlink {
COLOR: blue; TEXT-DECORATION: underline
}
A:visited {
COLOR: purple; TEXT-DECORATION: underline
}
SPAN.MsoHyperlinkFollowed {
COLOR: purple; TEXT-DECORATION: underline
}
SPAN.EmailStyle17 {
COLOR: navy; FONT-FAMILY: Arial; mso-style-type: personal-reply
}
DIV.Section1 {
page: Section1
}
</style></blockquote>
1.<br>
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite">
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009">What's the difference
between a tax and a fee in this case? If you live in a taxing
district, whether it's the City of Missoula or a SID, you're making a
payment to government solely on the basis of owning property.</span></font></div>
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009"></span></font> </div>
</blockquote>
2.<br>
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite">
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009">Perhaps the state law needs
to be changed. Under the current system, the city prepares its budget
by accounting for things like COLA payroll increases, rising health
care insurance, more expensive fuel, etc., and then finds that it's
hamstrung in collecting enough money to simply maintain current
operations, let alone undertake new projects like rebuilding a park.
So, in order to get around the state law, it begins using the SID
mechanism to accomplish what it can't do in an efficient and
straightforward manner.</span></font></div>
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009"></span></font> </div>
</blockquote>
3.<br>
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite">
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009">To be sure, I see two
advantages to using SIDs. One, it allows subsets of the city to have
higher tax rates to accomplish things the state law currently prevents
(assuming other programs aren't cut), and as has been pointed out, this
subset can equal the city itself. Two, since 40% of a SID can block
the SID, it requires more support than a simple majority, thus implying
only projects with substantial support are funded by the mechanism.</span></font></div>
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009"></span></font> </div>
</blockquote>
4.<br>
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite">
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009">OTOH, as demonstrated by the
park rebuild financing and administrative costs, a SID creates another
layer of bureaucracy and expense. Wouldn't taxpayers get more bang for
their buck under a system in which the budget is set and then the taxes
required to pay for it are collected, and that's it?</span></font></div>
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009"></span></font> </div>
</blockquote>
5.<br>
<blockquote cite="mid:E84FF708D4B34C0ABEA98A2A78F2718B@ryan" type="cite">
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009">One other thing. It seems
to me that there's nothing preventing the Council from saying going
forward that while state law forces the City to use SIDs to raise
additional revenue, only city-wide SIDs will be used. Thus, the park
still gets rebuilt, but the entire city pays for what is an entire city
asset. Perhaps that would permit the SID to piggyback on the standard
property tax system instead of having to create an additional one for
the SID. Yes, I realize that in this example of the park rebuild, the
city would be taxing everyone $5 instead of 1,000 people $750, but if
this approach was used, and you didn't want to separately bill such a
small amount, a city-wide SID could cover a bundle of projects spread
across the city, thus combining financial efficiency with broadly based
political support.</span></font></div>
<div dir="ltr" align="left"><font color="#0000ff" face="Arial"
size="2"><span class="079504420-15022009"></span></font> </div>
<div dir="ltr" align="left"> </div>
<br>
<div dir="ltr" class="OutlookMessageHeader" align="left" lang="en-us">
<hr tabindex="-1"><font face="Tahoma" size="2"><b>From:</b>
<a class="moz-txt-link-abbreviated" href="mailto:missoulagov-bounces@cmslists.com">missoulagov-bounces@cmslists.com</a>
[<a class="moz-txt-link-freetext" href="mailto:missoulagov-bounces@cmslists.com">mailto:missoulagov-bounces@cmslists.com</a>] <b>On Behalf Of </b>Jim
McGrath<br>
<b>Sent:</b> Sunday, February 15, 2009 10:21<br>
<b>To:</b> Jed Taylor; <a class="moz-txt-link-abbreviated" href="mailto:missoulagov@cmslists.com">missoulagov@cmslists.com</a><br>
<b>Subject:</b> Re: [MissoulaGov] On SIDs<br>
</font><br>
</div>
<div class="Section1">
<p class="MsoNormal"><font color="navy" face="Arial" size="2"><span
style="font-size: 10pt; color: navy; font-family: Arial;">In order for
the citizens of <st1:City w:st="on"><st1:place w:st="on">Missoula</st1:place></st1:City>
to raise their own taxes –assuming we agree to that—state law would
need to be changed. The city has extremely limited taxing authority.
Hence the shift to fees by municipalities across the state.<o:p></o:p></span></font></p>
<p class="MsoNormal"><font color="navy" face="Arial" size="2"><span
style="font-size: 10pt; color: navy; font-family: Arial;"><o:p> </o:p></span></font></p>
<div>
<div style="text-align: center;" class="MsoNormal" align="center"><font
face="Times New Roman" size="3"><span style="font-size: 12pt;">
<hr tabindex="-1" align="center" size="2" width="100%"></span></font></div>
<p class="MsoNormal"><b><font face="Tahoma" size="2"><span
style="font-weight: bold; font-size: 10pt; font-family: Tahoma;">From:</span></font></b><font
face="Tahoma" size="2"><span
style="font-size: 10pt; font-family: Tahoma;">
<a class="moz-txt-link-abbreviated" href="mailto:missoulagov-bounces@cmslists.com">missoulagov-bounces@cmslists.com</a>
[<a class="moz-txt-link-freetext" href="mailto:missoulagov-bounces@cmslists.com">mailto:missoulagov-bounces@cmslists.com</a>] <b><span
style="font-weight: bold;">On Behalf Of </span></b>Jed Taylor<br>
<b><span style="font-weight: bold;">Sent:</span></b> Sunday, February
15, 2009 1:57 AM<br>
<b><span style="font-weight: bold;">To:</span></b>
<a class="moz-txt-link-abbreviated" href="mailto:missoulagov@cmslists.com">missoulagov@cmslists.com</a><br>
<b><span style="font-weight: bold;">Subject:</span></b> [MissoulaGov]
On SIDs</span></font><o:p></o:p></p>
</div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"><o:p> </o:p></span></font></p>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">Reading
the discussion on SIDs has been interesting. Here are some thoughts I
have on them.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">SIDs seem
to really go to the question of what is the City of <st1:City w:st="on"><st1:place
w:st="on">Missoula</st1:place></st1:City>. If the city is a single
entity in which its residents share the expense of its maintenance and
improvement regardless of any individual neighborhood's relative
ability to contribute to the pot, and maintenance and improvement is
provided on the basis of need regardless of that same relative ability,
then SIDs in general seem to be about the last way projects should be
paid for. People get the city they're willing to pay for, and it's up
to those who feel more money is needed to convince a majority that
taxes need to be raised, not necessarily so their own street is nicer,
but so the city in general is.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">OTOH, if
Missoula is really a confederation of neighborhoods where basic
services such as the police are paid for based on a city-wide basis,
but more localized projects such as rebuilding a park or putting in
street lights are undertaken only when enough residents of a
neighborhood can force everyone in that neighborhood to participate in
a SID, then SIDs seem a perfectly rational way of financing things.
It's not the model I prefer, because it seems that this would tend to
Balkanize the city, but it would have the benefit of keeping the
fundamental tax rate lower than the alternative and letting specific
areas decide what they want and what they can live without (although
living without is often not much of a choice, but rather a necessity).</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">In either
case, I do think it would be a good thing strategically for the council
to state which model they think is appropriate so <st1:City w:st="on"><st1:place
w:st="on">Missoula</st1:place></st1:City> residents know where its
government is coming from and so individual project decisions don't
seem ad hoc.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">There's
never going to be a perfect time or method to transition from SIDs to
city-wide funding. Anyone who's already participated in a SID has
already decided how they're going to pay for it, even if they haven't
cut the check yet. Should the council decide to stop using 'mandatory'
SIDs (as opposed to using the mechanism to help a group voluntarily
donate something like a park rebuild to the city), I would suggest that
the council should adopt a 'that-was-then, this-is-now' approach,
declare a new strategic vision, and say something along the lines of,
"Starting in 2010, we 're one city and everyone in the city is going to
help each other pay for what's needed. Therefore, we're no longer
going to use mandatory SIDs as a way of paying for projects."</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">Concerning
sidewalks, it seems that the city could make them the responsibility of
each property owner to maintain his to a minimum standard, much as it
does requiring a property owner to keep his sidewalk clear of snow and
ice. If a property owner wants to tear his up once a year and lay a
new one down, let him. If his sidewalk falls below minimum standards,
order it repaired or have the city do it and bill him. And if he
doesn't have a sidewalk, then the city pays for putting one in and he
enjoys the increase in property value while also acquiring the
responsibility to maintain it.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">Regarding
letting a property owner defer his SID payment until the sale of his
property, is the city charging interest on what amounts to a loan?
What happens if there isn't enough money from the proceeds of the sale
to pay what he owes?</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">The cost
of financing of the recent park rebuild SID seems to point to marked
benefits that could be made available to city residents if the city
created something along the lines of a municipal credit union to help
them finance local governmentally imposed financial obligations. From
what I heard from the committee meeting during which the financing of
this park rebuild was discussed, only ~$250k of the cost is going to
outside contractors, who obviously won't want to wait to get paid.
Another ~$250k is actually budgeted items being provided by the city,
such as the use of a dump truck, that are being billed to the SID as if
the SID is renting them from the city (and that's as it should be given
the financial design of this project). Surely, the city doesn't need
to paid right away for these items - it's paying for the dump truck
regardless. Therefore, this project is incurring ~$65k of legal and
underwriting fees to produce ~$250k of revenue that's needed decently
soon. Maybe this is indeed the absolutely only way to finance this
project, and maybe the SID members find this ratio of fees to revenue
acceptable in order to get the park rebuilt, but these kind of numbers
suggest that there's a very strong need to put in place a program for
the future that makes it possible to cover the cash flow before SID
income is available without spending money on lawyers and underwriters.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">BTW - am I
correct in assuming that the members of this SID are, in effect,
donating this park rebuild to the city?</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">Finally,
because parks are really something for everyone, both within and
without the city, to enjoy, and because there's quite a business
function aspect to running the park system, it seems to me that a
separate Missoula Park District would be something well worth
consideration. This District could be, by design, larger than the city
itself, and since it would be a separate taxing district, people could
more readily determine how much they're will to pay for their Park
District and whether they're getting what they're paying for.</span></font><o:p></o:p></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font face="Times New Roman" size="3"><span
style="font-size: 12pt;"> <o:p></o:p></span></font></p>
</div>
<div>
<p class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;"><o:p> </o:p></span></font></p>
<div class="MsoNormal"><font color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;">
<hr style="width: 337.5pt;" align="left" color="#990000" noshade="noshade"
size="2" width="450"></span></font></div>
<p class="MsoNormal"><font color="#990000" face="Verdana" size="2"><span
style="font-size: 10pt; color: rgb(153, 0, 0); font-family: Verdana;">“Be
the change you want to see in the world.” - Mahatma Gandhi</span></font><font
color="navy" face="Verdana" size="2"><span
style="font-size: 10pt; color: navy; font-family: Verdana;"> </span></font><o:p></o:p></p>
</div>
</div>
<pre wrap="">
<hr size="4" width="90%">
_______________________________________________
-----Please delete extra content when replying to messages------
Note: This list is NOT an official service of the City Of Missoula. But posts to this list may be entered into the public record.
Subscribe or view archives at Missoulagov.org
List Serve hosting provided by <a class="moz-txt-link-abbreviated" href="http://www.CedarMountainSoftware.com">www.CedarMountainSoftware.com</a>. </pre>
</blockquote>
</body>
</html>