One of the DFL and media’s (ptr) hoariest chanting points is the idea that “Republicans raised property taxes!”, and that the DFL – due to its tender regard for the middle class – is hotly engaged in cutting them.
This is a classic low-information voter play, of course; the state doesn’t set property taxes. City and county governments do.
All the state does is send money, in the form of Local Government Aid (LGA) and Market Value Homestead Credit (MVHC) to cities and counties to subsidize their activities…
…and then, theoretically, those lower levels of government use that money to lower their citizens; since they’re getting money from the state in the form of tax dollars redistributed from the rest of the state, they can tax their own citizens less.
Well, no. Usually not. If you’ve read this blog, you already know more than most Democrat voters; that when LGA was “cut” over the past decade, cities and counties raised vastly more in tax hikes than they’d actually gotten from LGA in the first place. Such is the addiction of government at all levels to spending.
And now that the DFL has cranked open the spigot again, what’s going to happen?
A PiPress editorial last week notes that “government will cut property taxes about the time I’m caught by paparazzi leaving a Los Angeles club with Amy Adams” is the proper answer to that. I’ll add emphasis:
A Pioneer Press report this week on 31 metro suburbs cheering the restoration of funding they receive from the state included this note of caution: “There’s no guarantee cities won’t spend all the new state money on services, salaries or public works projects.”
Reporter Bill Salisbury cited findings in a 1990 analysis by the Office of Legislative Auditor that “state aid may boost city spending more than it provides local property tax relief.”
It said cities had used 82 percent of their additional aid to pay for increased spending and only 18 percent to reduce property taxes. Citizens should be prepared to hold their local lawmakers accountable.
But the DFL – and, for the most part, the media – have done their best to diffuse this accountability, to couch this “aid” in terms of “Free money borne down from the sky by unicorns”, rather than money taken from the parts of this state that work – the Twin Cities exurbs and some prosperous outstate communities – and redistributed to smaller towns with lower tax bases (the original intent of LGA) and the Twin Cities and Duluth (which was not, but which became the primary focus of LGA over the past 20 years).
But the editorial is right. The DFL spent most of the past decade trying to make the case that hiking LGA was a matter of cutting property taxes.
It’s not, and has never been. It’s been a money transfer, mostly from the parts of the state that are run responsibly, mostly to the parts of the state that are not. And the smart people already know that this new money is going to overwhelmingly pay for new spending, especially new union-dues-paying government labor.
And as this last election cycle showed us, it’s not enough just to win the smart people.