CITIZENS   FOR  LIMITED  TAXATION
and the
Citizens Economic Research Foundation

Barbara's Column
May #2

Override mania:
You pay more so city, town employees can get more
by Barbara Anderson


The Salem News
Thursday, May 10, 2007

As I have written before this time of year: in spring, as Proposition 2 override signs pop up with the dandelions, the sound of the cuckoo is heard in the land, singing, "Higher taxes!" I think for many voters, that sound is more annoying than it used to be.

When Prop 2 was being drafted as an initiative petition and ballot question by Citizens for Limited Taxation in 1979, I recall the discussion about an override provision. It was accepted as a "safety net" to address concerns that a community might have an emergency -- a sudden unanticipated expense like a court judgment, or the police station burning down.

At a time when our property taxes were arguably the highest in the world, and people were very angry about this, it never occurred to us that someday voters might choose to raise their own taxes to pay for operating expenses -- like pay raises and benefits for some town unions that exceed anything the voters themselves receive from their health insurance and Social Security and/or pensions.

Of course the overrides aren't usually promoted for these "fixed costs," which are considered by local officials to be inevitably funded; voters are told the extra money is needed "for the children" or to preserve "community values" or avoid the loss of a program.

The town of Saugus has a budget crisis in 2007 because its town government negotiated unsustainable benefits with its unions. So taxpayers were told to raise their taxes or lose their library and senior center. Since this seems a disconnect to me, I was glad to see the override defeated -- especially since Saugus had the highest percentage support for Prop 2 when the ballot question passed in 1980. Apparently its voters haven't changed their minds about keeping control over their taxes.

It was good to see the Shrewsbury override go down for a different reason. We have often seen students used by school administrations to sell overrides. In this year's new twist, the Shrewsbury League of Women Voters arranged for kids old enough to vote to take a limousine to the polls in order "to start students off with a memorable voting experience that will encourage them to be lifelong voters."

I can see them at my age, still standing on the curb, waiting for that limousine to take them to vote again. The LWV, always a Prop 2 opponent, clearly tried to help the town get some votes for its override, giving new meaning to the phrase "limousine liberal."

Since that ploy didn't work, some override proponents in Shrewsbury have come up with a new idea -- voluntary contributions. Good idea, but if the money is used for "fixed costs" this will have to be a permanent, annual commitment.

Other override proponents have other ideas. Some argue that it's time to change Prop 2 to Prop 3 or 4, increasing the additional amount that can be raised each year without an override. Another original Prop 2 opponent, Ed Moscovitch of Cape Ann Economics, is advocating a state property tax in place of the local property tax to pay for education. The intent is to equalize the spending on students from wealthy and poor communities.

Education vouchers, funded by broad-based state taxes, would accomplish that goal without continuing reliance on the property tax, which Governor Patrick has recently criticized. He who promised "property tax relief" during his campaign says that his administration is working on a plan to address that reliance. So many hints, so little detail.

Proposition 2 has limited the property tax levy, as it was meant to do. But it can't make the right spending choices; only town meetings and city councils can do that.

Prop 2 encouraged the state to share more of its own revenues with the cities and towns, which is a good thing. State money from existing, broad-based taxes is a better source of funding for education than the property tax. But too often, the state money was used to increase the personnel expenses which then became "fixed costs" that cannot be sustained.

Too many local leaders couldn't say "No" to their public employee unions; so when the local aid ran out, they needed more property tax revenue to sustain the spending. Fortunately the voters themselves are able, because of the override provision, to say "No more."

After numerous newspaper articles about public employee pension abuses, citizens are becoming aware of the coming crisis in pension liabilities. Many have also been surprised to learn that many government employees have been promised health insurance for life, and that they become eligible for these benefits long before the rest of us are eligible for Social Security and Medicare.

Governor Patrick has proposed the beginning of reform in the benefits arena. We must not only wish him well in this endeavor, but help if we can.

If there is to be reform, Saugus and Shrewsbury voters did their part by voting against overrides. The difficulties that some communities face this year must inspire all politicians to take on the public employee unions to get the necessary reforms done now. Then we can all have a debate on the way education is funded.


Barbara Anderson is executive director of Citizens for Limited Taxation. Her column appears weekly in the Salem News and Eagle Tribune, and often in the Newburyport Times, Gloucester Times, and Lowell Sun; bi-weekly in the Tinytown Gazette; and occasionally in the Providence (RI) Journal and other newspapers.