Killing The Small Towns Won't Save Iowa Redux
by John Drury
Last week I wrote on the regional government plan that the state legislature has been working on. And as I got to thinking more about it, I realized some things that I didn’t touch on in last week’s column, so with your forgiveness, I’m going to talk about that issue again.
To recap, the plan calls for regions to be set up by the existing 15 community college districts. A state board would be created and eventually, there would be a series of meetings with regional leaders to determine which services could be shared. These proposals would end up on voter’s ballots in each community for approval. If the communities do not approve sharing plans within 6 years, they would be penalized. These penalties include not being able to raise property taxes, and not being eligible for some state grants.
In other words, voters of communities would have to approve sharing plans with regional governments. If they didn’t approve a plan in 6 years, they would be “penalized” by the state. One of the penalties discussed is a freezing of property taxes at the current rate.
And this is where it gets interesting. If the “penalty” is a freezing of property taxes where they are now, isn’t that actually an incentive for the voters to not share? I mean, wouldn’t the voters take a fixed rate as opposed to a variable when it comes to property taxes? There’s certainly no guarantee that property taxes will go down as a result of the sharing. In fact, there are examples showing that sharing services doesn’t necessarily save any money.
What this plan really comes down to is the state legislature is punishing local governments. When the voters do not approve a sharing plan, local governments will not have the ability to raise the funds needed to provide the services their citizens demand. If they are not able to provide those services, the smaller communities will have an even tougher time attracting people to their communities and eventually they will cease to exist; and at that point the state legislature can declare mission accomplished.
The state legislature likes to blame local governments for rising property taxes. Well, in north Iowa, where the population is dwindling, perhaps the rising property tax rates are at least partly due to a smaller base of taxpayers to spread out the costs. And perhaps the dwindling population is due to the lack of any real strategy when it comes to bringing high paying, good jobs to the region. We won’t get into what is happening to Iowa’s air and water.
The legislators in favor of the plan will argue that local governments shouldn’t have the ability to continue to raise property taxes beyond what is reasonable. I agree, and there are already limitations in place. And those same legislators will argue that state has to deal with declining revenues and so should the local governments. And those same legislators, in the face of declining revenues, continue to pass tax cuts and loopholes that don’t make any sense. I guess it’s difficult for me to have sympathy for those who impose hardship on themselves.
Enacting this plan will further enable the incompetent approach we are taking to economic development and rebuilding our rural economy. I said this last week, but it bears repeating: our local governments serve important roles. Consolidation will only make services more difficult to provide. Our state government should be focused on improving the overall health of the state without trying to murder the small towns.
