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<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>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 size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
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<p class=MsoNormal><b><font size=2 face=Tahoma><span style='font-size:10.0pt;
font-family:Tahoma;font-weight:bold'>From:</span></font></b><font size=2
face=Tahoma><span style='font-size:10.0pt;font-family:Tahoma'>
missoulagov-bounces@cmslists.com [mailto:missoulagov-bounces@cmslists.com] <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> missoulagov@cmslists.com<br>
<b><span style='font-weight:bold'>Subject:</span></b> [MissoulaGov] On SIDs</span></font><o:p></o:p></p>
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12.0pt'><o:p> </o:p></span></font></p>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>Reading the discussion on SIDs has been
interesting. Here are some thoughts I have on them.</span></font><o:p></o:p></p>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color=navy face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:navy'>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>
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<p class=MsoNormal><font size=2 color="#990000" face=Verdana><span
style='font-size:10.0pt;font-family:Verdana;color:#990000'>“Be the change
you want to see in the world.” - Mahatma Gandhi</span></font><font
size=2 color=navy face=Verdana><span style='font-size:10.0pt;font-family:Verdana;
color:navy'> </span></font><o:p></o:p></p>
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