Tag: property tax
Casino Closings Wipe $2B From Atlantic City Property-Tax Values

Casino Closings Wipe $2B From Atlantic City Property-Tax Values

By Harold Brubaker, The Philadelphia Inquirer

The closure of three Atlantic City casinos by mid-September will wipe $2 billion from the city’s property-tax values next year, exacerbating the already cash-strapped city’s financial plight, Mayor Don Guardian warned Tuesday.

By 2017, property values are expected to have fallen to as little as $7.5 billion from $20 billion five years ago, Guardian said during a conference call to discuss Atlantic City’s way forward as a tourism center following the rout of its casino industry.

In the short term, Guardian said the New Jersey Department of Community Affairs has made money “available for some bridge loans to make sure that the city continues functioning with this year’s budget because of any concern that we might have that a casino’s closing, going bankrupt might hold off payments.”

Over the next four years, the city needs to trim $40 million from its budget, Guardian said. The city recently passed a 2014 budget of $261.4 million.

Part of the savings will come from the elimination of entire departments, though Guardian said he couldn’t name them at this point. As many as 300 positions must be eliminated from the city’s workforce, some of which have already disappeared because of attrition, he said. As of July, 2013, Atlantic City had 1,267 full-time employees, according to a bond prospectus.

The Department of Community Affairs has also agreed to back a $140 million municipal bond offering that will be used to pay tax refunds and settlements. For example, the city owes the owner of Borgata $88 million for tax settlements covering the years 2011 through 2013.

Photo: Philadelphia Inquirer/MCT/Clem Murray

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Rick Perry Knowingly Put Texas In The Red

Rick Perry talks about cutting taxes, spending, and managing budgets as if his ten years as Texas’ chief executive have lent him the knowledge and experience to be a wise fiscal manager. Unfortunately for Texans and, now that he is seeking the presidency, possibly for Americans as well, that does not appear to be true, in more ways than one, as Washington Spectator editor Lou Dubose explains:

Because there is no income tax [in Texas], property taxes are high. In 2006, Perry called a special session to address property taxes. With no income tax, there are no easy fixes. Yet Perry found one. A business-margins tax he said would provide enough revenue to allow for reductions in property taxes.

It was evident at the time that the new tax would not deliver what the governor promised. The state comptroller, [Republican] Carole Strayhorn, had her staff run the numbers on Perry’s tax-reform proposal.

“In 2007,” she wrote in a letter to Perry, “your plan is $3.4 billion short; in 2009, it is $5.4 billion short; in 2010 it is $4.9 billion short, and in 2011 it is $5 billion short. These are conservative estimates.”

The comptroller warned that “no economic miracle will close the gap your plan creates. Even if every dollar of the current [2006] $8.2 billion surplus was poured into the plan, it would not cover the plan’s cost for more than two years, 2007 and 2008. The gap is going to continue to grow year by year.” The shortfall the bill created could only be closed by tax increases, the comptroller warned, “or massive cuts in essential public services — like public education.

By now we all know what Rick Perry is selling. He collaborates with the private sector to create jobs and to attract jobs from other states. The Texas Enterprise Fund and the Emerging Technologies Fund, his creations, have had unprecedented success.

It’s not as simple as Perry would have you believe.

The two big economic development funds Perry controls operate on a trickle-up economic theory. The state takes money from taxpayers and gives it to corporations to entice them to create new jobs.

Yet corporations often fail to deliver, and the governor and his staff rewrite corporations’ contracts to relax their job-creation requirements.

Grants are often made to companies that would move into the state or expand their workforce without a taxpayer-funded incentive.

The governor hands over millions of dollars to corporations whose executives have contributed hundreds of thousands of dollars to his campaigns.

Perry’s scornful attitude toward science — made plain in his explicit endorsement of teaching “intelligent design,” his dismissal of evolution and his extreme skepticism of climate change — apparently applies to basic mathematics as well. His style of accounting rejects empirical facts and projections about budgets and revenues in favor of “economic miracles” that will supposedly allow government to “grow out of it” when faced with hard choices between deficits and taxes.

Despite his poor personal relationship with George W. Bush, Perry’s version of economics sounds an awful lot like what Bush believed when he embraced tax cuts and supply-side doctrine regardless of nonpartisan estimates awash with red ink. (There’s a similar whiff of cronyism to boot.) If a Republican who specialized in budget gimmickry is so enthusiastically supported by Tea Party voters, imagine how they might respond to a candidate who actually reduced the deficit in a responsible manner — like President Obama with his health-care reform. Then again, perhaps we already know.

Alabama Residents Still Required to Pay Taxes For Confederate Memorial

Most Southern states, especially in the Deep South, are very conservative, and tend to send people to Congress who uniformly oppose taxes. But residents apparently don’t mind continuing to pay a tax originally designed to provide benefits for Confederate veterans of the Civil War:

Despite fire-and-brimstone opposition to taxes among many in a state that still has “Heart of Dixie” on its license plates, officials never stopped collecting a property tax that once funded the Alabama Confederate Soldiers’ Home, which closed 72 years ago. The tax now pays for Confederate Memorial Park, which sits on the same 102-acre tract where elderly veterans used to stroll.

The tax once brought in millions for Confederate pensions, but lawmakers sliced up the levy and sent money elsewhere as the men and their wives died. No one has seriously challenged the continued use of the money for a memorial to the “Lost Cause,” in part because few realize it exists; one long-serving black legislator who thought the tax had been done away with said he wants to eliminate state funding for the park.

These days, 150 years after the Civil War started, officials say the old tax typically brings in more than $400,000 annually for the park, where Confederate flags flapped on a recent steamy afternoon. That’s not much compared to Alabama’s total operating budget of $1.8 billion, but it’s sufficient to give the park plenty of money to operate and even enough for investments, all at a time when other historic sites are struggling just to keep the grass cut for lack of state funding.

This serves to remind us that many conservatives don’t necessarily oppose public spending, or even taxation. What they find existentially threatening, though, are taxes that they envision going to undeserving “others,” specifically blacks. Indeed, political scientists have shown time and again that individual views that blacks are “lazy” are strongly correlated with opposition to social welfare spending, and that people tend to wrongly believe most welfare recipients are black.

That Alabama, a state where roughly a quarter of children grow up in poverty, is raising hundreds of thousands annually to remember an ill-fated campaign to preserve slavery without any kind of right-wing backlash, reminds us of the extent to which attitudes about race are intricately tied up with anti-tax sentiment. Lest we forget, opposition to healthcare reform is inextricably linked with racial resentment.

Alabama Residents Still Paying Taxes for Confederate Veterans’ Benefits

MOUNTAIN CREEK, Ala. (AP) — The last of the more than 60,000 Confederate veterans who came home to Alabama after the Civil War died generations ago, yet residents are still paying a tax that supported the neediest among them.

Despite fire-and-brimstone opposition to taxes among many in a state that still has “Heart of Dixie” on its license plates, officials never stopped collecting a property tax that once funded the Alabama Confederate Soldiers’ Home, which closed 72 years ago. The tax now pays for Confederate Memorial Park, which sits on the same 102-acre tract where elderly veterans used to stroll.

The tax once brought in millions for Confederate pensions, but lawmakers sliced up the levy and sent money elsewhere as the men and their wives died. No one has seriously challenged the continued use of the money for a memorial to the “Lost Cause,” in part because few realize it exists; one long-serving black legislator who thought the tax had been done away with said he wants to eliminate state funding for the park.

These days, 150 years after the Civil War started, officials say the old tax typically brings in more than $400,000 annually for the park, where Confederate flags flapped on a recent steamy afternoon. That’s not much compared to Alabama’s total operating budget of $1.8 billion, but it’s sufficient to give the park plenty of money to operate and even enough for investments, all at a time when other historic sites are struggling just to keep the grass cut for lack of state funding.

“It’s a beautifully maintained park. It’s one of the best because of the funding source,” said Clara Nobles of the Alabama Historical Commission, which oversees Confederate Memorial Park.

Longtime park director Bill Rambo is more succinct.

“Everyone is jealous of us,” he said.

Tax experts say they know of no other state that still collects a tax so directly connected to the Civil War, although some federal excise taxes on tobacco and alcohol first were enacted during the war to help fund the Union.

“Broadly speaking, almost all taxes have their start in a war of some sort,” said Joseph J. Thorndike, director of a tax history project at Tax Analysts, a nonprofit organization that studies taxation.

Alabama’s tax structure was enshrined in its 1901 Constitution, passed after Reconstruction at a time when historians say state legislators’ main goal was to keep power in the hands of wealthy white landowners by disenfranchising blacks and poor whites.

The Constitution allowed a state property tax of up to 6.5 mills, which now amounts to $39 annually on a home worth $100,000. Of that tax, 3 mills went to schools; 2.5 mills went to the operating budget; and 1 mill went to pensions for Confederate veterans and widows.

The state used the pension tax to fund the veterans home once it assumed control of the operation in 1903. The last Confederate veteran living at the home died in 1934, and its hospital was converted into apartments for widows. It closed in 1939, and the five women who lived there were moved to Montgomery.

Legislators whittled away at the Confederate tax through the decades, and millions of dollars that once went to the home and pensions now go to fund veteran services, the state welfare agency and other needs. But the park still gets 1 percent of one mill, and its budget for this year came to $542,469, which includes money carried over from previous years plus certificates of deposit.

All that money has created a manicured, modern park that’s the envy of other Alabama historic sites, which are funded primarily by grants, donations and friends groups. Legislators created the park in 1964 during a period that marked both the 100th anniversary of the Civil War and the height of the civil rights movement in the Deep South.

Nothing is left of the veterans home but a few foundations and two cemeteries with 313 graves, but a museum with Civil War artifacts and modern displays opened at the park in 2007. Rebel flags fly all around the historic site, which Rambo said draws more than 10,000 visitors annually despite being hidden in the country nine miles and three turns off Interstate 65 in the central part of the state.

While the park flourishes quietly, other historic attractions around the state are fighting for survival.

Workers at Helen Keller’s privately run home in northwest Alabama fear losing letters written by the famed activist because of a lack of state funding for preservation of artifacts. On the Gulf Coast at Dauphin Island, preservationists say the state-owned Fort Gaines is in danger of being undermined by waves after nearly 160 years standing guard at the entry to Mobile Bay.

The old Confederate pension tax that funds the park has never been seriously threatened, Rambo said. Backers were upset this year when Gov. Robert Bentley’s budget plan eliminated state funding for historic sites because of tight revenues, he said, but the park’s earmarked funding survived.

“Once I informed the public what was going on the support just rose up,” said Rambo, the director since 1989. Two heritage groups, the Sons of Confederate Veterans and United Daughters of the Confederacy, led the charge, but ordinary citizens complained too, he said.

“Some were people who don’t belong to those organizations who really like the park and come out here for picnics and all and were really upset,” he said.

State Rep. Alvin Holmes, a black Democrat who’s been in the Legislature since 1974, said he thought funding for the park had been slashed.

“We should not be spending one nickel for that,” said Holmes, of Montgomery. “I’m going to try to get rid of it.”

Holmes may have a hard time gaining support with Republicans in control of Legislature and the governor’s office.

In the meantime, a contractor recently measured the museum for a new paint job, and plans calls for using invested money to construct replicas of some of the 22 buildings that stood on the site when it was home to hundreds of Confederate veterans and their wives.

Copyright 2011 The Associated Press.