by Tolbert Rowe
I don’t like paying health insurance premiums of $8,400 per year plus a $4,000 deductible before my insurance company pays anything. I don’t like paying $20 parking tickets and $250 cell phone bills, and I especially don’t like paying more taxes. Be it property taxes or income taxes to any of the three branches of government that siphon off pieces of every paycheck. I just don’t have confidence that the government can spend my money better than I can.
But the taxes I pay, and every other working person pays, are necessary for me to enjoy the freedoms of living in the United States of America. The cost to run local government is calculated in millions, state government in billions and federal government in trillions of dollars. The cost of services provided increases as the cost to run government increases.
The most expensive service that most local governments are required to provide is public education. It easily takes 40% to 60% of all local tax revenue to operate a school system. Sure, there is plenty of money from the state and federal government that goes to education, but as a percentage of the county’s budget, education is the biggest expense.
When a need arises to build or renovate school facilities only the wealthiest of counties have the ability to pay everything from the pool of local tax monies collected. Building a school, or significantly renovating one, costs in the tens of millions of dollars. In Caroline County it is not possible to do it without borrowing money.
Our three county commissioners agree that the only way to accomplish this is to raise income taxes, and I agree. For years the only local tax that people got emotional about was the property tax. But property taxes are paid by only those who own property, both individuals and businesses. Income tax is paid by everyone who has earned income, regardless of real estate ownership. And to generate the level of revenue from property taxes being received by the increase in income tax, the property tax rate would have to increase by seven cents.
Since my career is in the lending business and I have served as a school board member for 15 years, I feel somewhat qualified to put forth an explanation of why raising local income taxes is necessary. We must find a way to fund a larger Greensboro Elementary School and a facility worthy of the job our Sheriff’s Department and its 36 sworn officers and four overburdened support personnel do.
Let’s assume that you are a young family of three; Mom, Dad and four year old son. You own your home, your first, a two bedroom starter home in a townhouse community. You are happy and content and the services you are afforded in your community are sufficient for your young family’s needs. You are so content and comfortable that you soon find that you are expecting another addition to your family. But you are somewhat shocked, pleasantly, that you are not only expecting one child but you are expecting twins.
You knew that at some point you would outgrow your little townhouse and you had expected to sell and move up to a more spacious home for your growing family. But twins sort of push you to move a little faster than you had expected.
Similar to this situation is an overcrowded school. Greensboro Elementary currently educates over 800 students in a building designed to accommodate 670. This overcrowding did not happen overnight. It has been a growing issue to the extent that nine portable classrooms have been installed to house the growing number of students. What once were closets have become mini classrooms. The Media Center has lost 40% of its space for new classroom space. Staff and students have learned to “improvise”.
Much like your growing young family with twins, a boy and a girl, to go with their older brother in the two bedroom house, Greensboro Elementary needs more space. Because you live in a townhouse there is no possible way to add on. You have to sell your townhouse and buy a larger home.
But adding on to a school would be a possibility wouldn’t it? After all we can’t “sell” a school and take the proceeds to buy another, like the young family can do with their townhouse. Adding on to what we have just has to be cheaper, right?
The short answer is no. It is not cheaper to just add on to what we have. Greensboro School was built in 1974 using what was, at the time a new design concept of “open classrooms”. If you have been to Greensboro School or one of the others in our county built or renovated at that time, you will quickly see that they are functionally inadequate. The cost to renovate schools of this design exceeds the cost to build new. The Board of Education and Commissioners considered possibly phasing the renovation so as to spread the cost over many years but phasing only adds to the cost, not decreases it.
Because of Caroline County’s low assessable wealth base (total value of all real estate) the state pays 80% of construction costs, excluding soft costs like architectural and engineering costs. So for a $50 million school, Caroline County will have to come up with $10 million.
But a school is not the county’s only new construction need. Getting the Sheriff’s department out of the basement of the jail, into a safer, hygienically cleaner, (raw sewage leaks) more spacious facility is also a major priority for our commissioners and our community.
Because the young family lacks the savings and equity to pay cash for a new, more spacious home, they will need to borrow money. Caroline County also lacks the cash to pay for a new school and Sheriff’s department and will also need to borrow money.
The family will have to prove to a lender that they have the financial ability to repay the mortgage with future cash flows from employment. In much the same way Caroline County must show the ability to repay the loan or bond but with tax revenue instead of employment. Without generating new tax revenue, repayment of the bonds would come from current revenue. Since current revenue is used to fund current services, there would be a decrease in services from other agencies of local government.
As hard as the decision is to make, raising taxes is a decision that rightfully could have been done years ago. The decision to raise local taxes rests squarely on the shoulders of three people, our elected commissioners. They alone are forced to decide to raise taxes on their friends, families, neighbors and themselves. They alone are responsible for making all of us pay more than we would like to be paying in taxes.
My, how easy it is in States like Delaware where school systems have the power to tax. How easy it is for elected officials to place a request to increase taxes before all of the people. The results of a referendum allow individual elected officials to stand behind the screen of the ballot. “The people have decided” is the foundation of our electoral democracy. What a more fair and equitable way to decide how to raise, and spend public monies.
But Maryland is unique in how public schools are funded. Most states are like Delaware and put the decision for raising taxes to fund capital construction on the ballot. In Maryland, we have to rely on the character and integrity of those we elect, and hope they do the right thing. Personally, I know we need a new school in Greensboro and we need a Sheriff’s Department that is not in the basement of the jail.
Our Commissioners have done the right thing by raising income taxes. As much as I despise paying higher taxes, I know it is the only way to fund what is necessary. If anyone doesn’t think a new school or Sheriff’s facility is needed and necessary, please take the time to take a tour. Contact Principal Dawn Swann or Sheriff Randy Bounds. They are more than happy to give you a tour. If you can’t take the time to educate yourself on the need then please refrain from criticizing those who make the hard decisions, and if you know a better way to fund such improvements, please enlighten us all.
I wish everyone a Blessed and Joyous Christmas and Happy Healthy New Year.