City Government – Perspective

According to the city website, there are 4 key sources of funding that make up Dover’s ~$135,000,000 annual budget (all numbers are estimates for illustration.  For exact numbers please refer to the city’s website linked earlier in this post):

  1. Property Taxes: $77.4m
  2. Fees and Permits: $5.8m
  3. Intergovernmental Charges for Services: $21.8m
  4. Education: $21.4m
  5. Other transfers & misc: $9.2m

Historically tax payers didn’t have a choice in how much property tax they want to pay, we are told how much to pay which is equal to the amount required by the city to run our governmental services and payroll, and if the city needs more money to operate there is little choice but asking its tax payers to pay more every year.  Ultimately this is what led to proposition 13 (https://www.californiataxdata.com/pdf/Prop13.pdf) in 1978 in CA, and has led to several communities following that model to limit property tax increases by instituting a tax cap, Dover included.  The history of what happened in CA, to their education system, shows that this model has a fairly substantial downside long term.  However, that being said, Dover’s tax rate is right near the median for the state, so we shouldn’t necessarily feel like the tax cap in Dover is holding us back from making strong economic and academic growth.  To me this comes down to value, do tax payers ever think they are getting the value they deserve from their tax dollars?  Probably not all at once, but I would bet that when you crumbling street is repaved you feel like those are your tax dollars at work, or if you have kids in public school, you probably feel like you are getting some value from your tax dollars as well.  The problem is this feeling of value is not sustained, it quickly fades and that same neighborhood will again feel under-served by their tax dollars.  Its like your cable bill, initially you feel like there is some value in getting all of those channels, but eventually the introductory pricing expires and you are left with over $100/month for something that doesn’t feel like the amount of value it initially did when you purchased it.  Another analogy would be insurance, no one wants to pay for it, but the moment you need to cash in on it you are thankful that you have it and are experiencing the value of what it provides.  In most cases the money you have paid into insurance is less than the claim you are making and that is what makes insurance valuable during a claim.  For example, let’s say you pay in $90,000 in health insurance premiums over 30 years, then you have a heart attack.  That heart attack will likely cost hundreds of thousands of dollars… That $90k in premiums seems like a pretty good deal now, whereas if you are never sick you will always look  at that $90k as a sunk cost and yielded no personal value to you at all.  Likely you will be pretty ticked off that you ‘lost’ that money paying for someone else’s medical care…and that is rub with socialized coverage, like insurance, of any kind.  Also true of your tax dollars at work, that money is socialized by the city to cover services for the greater good.

I think to a point, all customers (tax payers) understand that there is value for their tax dollars in critical services, like fire and police protection, but when it comes to other services, like education, there can be a wide range of perspectives depending on your specific demographic.  While some in the community feel they are getting value from this service, others without kids in the schools can’t justify any additional investment that hits them financially to ‘improve’ education (new schools for instance).  This is a totally reasonable reaction to someone else spending your money.  Just as in my business, we need to justify expense and investment in a way that demonstrates the broad value of spending someone else’s money.  Customers (tax payers) want assurances that the people spending their money are doing so responsibly and with care to how it will impact every customer (tax payer) in the organization (municipality).  So how do we do this?  Well, it is not easy.  So how do we make it better?  Well, it is not simple…

In my opinion, this is a matter of public engagement.  How can we ensure that residents feel empowered to direct their tax contributions to the city to areas that benefit them directly.  Maybe this isn’t the ultimate answer, but certainly a starting point and the best place to start anything is at the starting line.  What if we had a mechanism to provide both direct lines to city officials, projects and budgets as well as a feedback loop where the public could submit new projects/issues based on what they are seeing in the city?  It may be tough for the city to understand intimately what is happening on every road and sidewalk, but our citizens have their fingers on the pulse of every mile of roadway and every inch of sidewalk.  What if we could crowd-source issues in the city and hold our city accountable to fixing issues as they come up?  I think the city would appreciate this as well, understanding what is happening first hand from the public and being given the opportunity to address public concern quickly and effectively.  Would that demonstrate value as a tax payer?  I would again argue that would be a terrific start.  What do you think?

Check out my Dover 311 blog post for some additional context on connecting the city.

 

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