Friday, March 4, 2011

Which Tax is the "Best" Tax?

An important pair of bills that I am still trying to get my head around have to do with public school funding. One, HB 301, changes how district schools can levy property tax increases. The other, HB 313, requires school districts to share with charter schools the funds that they get from property tax. This is what I know so far about these bills and the history behind them:

Currently, charter schools cannot claim property tax money. The state makes up the difference from income taxes. When charter schools were first approved in Utah, the claim was that they would be so much more efficiently-run that they could provide education for less and didn’t need the property tax funds. They do receive the WPU from the state and the state has a special line item in the general education budget that helps them with capital and start up expenses.

If these two bills are passed, the extra expenses to the state income tax for charter schools will go away and local property taxes will have to pick up the slack. The bill sponsor claims that having school districts responsible for the cost of funding charter schools in their boundaries is a matter of local control but all of the public school entities (except the charter school administrators) are protesting. The districts have no control over the charter schools in their districts. It would be like telling you as a household that you were responsible for the cost of maintaining your neighbor’s house and grocery bill without giving you a say in how they furnish their home or what food they purchase. This is not local control; it is an unfunded mandate. It also guarantees that your property taxes will go up. This will affect you whether you own your home or rent, since landlords will pass on the expense. Seniors who own their homes but are surviving on a fixed income will be hit hardest. If these bills were combined, they would probably not pass. They look likely to pass one gulp at a time.

Some are seeing a connection between these bills and vouchers. For that perspective, see this.


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