Valley Governments Not Friendly to Taxpayers

 by Chad Kirkpatrick & Tom Jenney  

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According to a new scorecard from the AZ Federation of Taxpayers, Arizona's local governments, especially in Maricopa County, scored dismally on tax and budget policy, because of things like increasing revenues from property taxes due to inflated property values and "home rule" measures that eliminate any spending caps.

The Arizona Federation of Taxpayers, a state chapter of Americans for Prosperity, recently released its first annual scorecard on local governments in Arizona, grading 563 local officials from around the state on tax and budget policy. The scorecard covers city council members from Bullhead City to Safford, and county supervisors from Apache County to Yuma County.

Weblink to scorecard:

In Maricopa County, seven city council members earned the designation of Friend of the Taxpayer: Danny Arismendez of Surprise, Steven Berman and Don Skousen of Gilbert, Jim Lane, Ron McCullagh, and Tony Nelssen of Scottsdale, and Tom Rawles of Mesa.

The slightly lower but still respectable Ally of the Taxpayer designation went to Ron Aames and Carlo Leone of Peoria, William Conner and Adam Super of El Mirage, Dave Crozier of Gilbert, Mayor Elaine Scruggs of Glendale, all members of the Cave Creek council, and the majorities on the councils of Scottsdale and Surprise.

But most Valley officials will not be happy to see this year's scorecard in the hands of local voters. Majorities on the Glendale and Peoria councils earned the designation of Allies of Big Government. Majorities on the Litchfield Park and Mesa councils earned the lower designation of Friends of Big Government, as did all of the members of the Fountain Hills council. Still lower were the majority on the Avondale council and all of the members of the Phoenix council, who scored as Champions of Big Government. At the bottom of the list were the members of the Chandler City Council, whose skyrocketing budget and property tax levies made them the Heroes of Big Government.

(Among Maricopa County cities and towns, Buckeye, Gila Bend, Guadalupe, Tolleson, Wickenburg, and Youngtown failed to post the relevant documents to their official city websites.)

There are several causes for the generally low scores earned by Valley officials.

Property Taxes: Rates versus Levies. One of the main goals of the AFT-AFP scorecard is to clear up widespread confusion about property tax rates and property tax levies. Many Valley officials were proud to announce that they had lowered property tax rates, but with huge increases in assessed valuations, lower rates can still mean higher taxes. Few Valley officials kept their combined property tax levies from growing faster than the rate of state personal income growth.

No Spending Limits. Thanks to "home rule" measures passed by voters, the only spending limit faced by Valley cities and towns is their ability to bring in tax revenue. That means that in a year of strong revenue growth, city and county spending growth can easily exceed the rate of population growth plus inflation (the fiscally conservative limit) and even exceed the rate of personal income growth (the fiscally moderate limit).

Huge Boom in State-Shared Revenues. State-shared income tax revenues increased by seven percent this year, while state-shared sales tax revenues increased by a whopping 24 percent. Although every indicator shows that state-shared revenues will fall off sharply next year, many local officials chose to use those revenues to boost overall spending this year to levels that may not be sustainable in the future without sizeable budget cuts and/or tax increases. (Note to officials: Do not raise taxes!)

The Growth Illusion. Some officials will no doubt argue that they had to enact large budget increases in order to accommodate rapid population growth with adequate development infrastructure. But the truth is that an official's political philosophy is the main determinant of how much he or she votes to spend. Some Valley officials in high-growth areas voted for small spending increases, and some Valley officials in lower-growth areas voted for large spending increases. The real difference is that fiscally conservative officials relied more on the private sector for development infrastructure, while profligate officials relied more on government.

Nobody's Watching. Too many Valley officials seem to operate under the assumption that no one is watching them, and that their job is simply to spend as much money as they can. With the release of AFT-AFP's scorecard, Valley officials are now on notice that the taxpayers are watching. We look forward to seeing much better scores next year.

Politics: General, Arizona Politics, Econ. & Public Policy, Science, Technology, Energy

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