Croker Sack

"Democracy is the theory that the common people know what they want, and deserve to get it good and hard." — Henry Louis Mencken (1880-1956)

Friday, August 18, 2006

Sun Spots: Central Kitsap Fire District Levy Disinformation

The Kitsap Sun got another chance to deal with the questions connected with a property tax levy "lid lift" ballot proposition, and just as before they misled their readers.

This time, it is the Central Kitsap Fire and Rescue District's ballot proposition that got the Sun's misleading coverage.

The "news" article omitted all mention of the magnitude of the proposed property tax increase compared to this year's levy. While it stated the amount that would be collected as a result of the lid lift, it didn't state what percentage increase is involved; nor did it state what this year's levy is. So, readers would be unable to determine that they are being asked to increase the district's levy by more than 50 percent.

If the article had included the fact that the tax increase would exceed 50 percent, or if it had stated the amount of this year's levy so that the estimated 2007 levy increase could be compared with it, readers would have known it's a big increase.

Just as the Sun did in March with the contemplated Kitsap Regional Library lid lift, the "news" article incorrectly stated that the fire district's levy funding has actually declined during the past few years and that annual levy funding increases are limited to one percent per year:

The last time voters approved a levy lid lift was 1999. That lift was for $1.50 per $1,000 of assessed property value to be collected in 2000. Today that levy is $1.04 per $1,000 of assessed value because the district’s primary funding source comes from property taxes. While property taxes have increased since 1999, the fire district’s levy funding has declined due to state law that only allows fire districts’ revenue to increase by 1 percent each year without voter approval.

This "news" article was followed up by today's editorial opinion -- advocating approval of the lid lift, of course.

The editorial also omitted the essential information about the percentage by which the district's regular levy funding would increase if the voters approve the lid lift proposition.

Instead of telling their readers how much the increase is, they dwelled on the current and estimated tax rates:

Currently, CK Fire & Rescue is collecting about $1.04 per $1,000 of assessed property value on its fire levy. With voter approval of the levy lid lift, it would collect $1.36 per $1,000 in 2007. Without voter approval, the fire levy would be approximately 90 cents per $1,000 in 2007.

The per-$1,000 rate is dwindling because of voter-approved Initiative 747, which put a 1 percent lid on tax revenue increases a district can collect annually. Because property values are increasing in the fire district, it takes a lower per-$1,000 amount to meet the 1 percent lid each year.

The fire district doesn't spend its tax rate. It spends its levy funding. So why dwell on the tax rate? Apparently to give the impression that the district's funding has not increased.

The editorial repeats the falsehood about one percent limits on annual revenue increases. Of course, I-747 didn't limit levy funding increases to one percent a year. That's why the district's average annual increase since I-747 went into effect has been 2.9 percent.

Both the article and the editorial pointed out that service demand increased by 24 percent since 1999 -- a bit of information which the district also provides on its web site.

But, what has the district's levy funding done during that same span of time? It has increased by 29.8 percent.

Is that simply an inconvenient fact for the Kitsap Sun and fire district, so they both omit it when telling voters what is proposed?

It seems obvious that inflation has increased the number of dollars the district needs since 1999. Perhaps the district needs an increase in the range of 20 - 25 percent to offset the effects of inflation.

When combined with the increased demand for services, the district may be able to justify an increase in the range of 44 - 49 percent (24 percent demand increase plus 20 - 25 percent inflation over the past 7 years).

But, the district already got a 29.8 increase in levy funding during that 7 years, so the needed increase to offset both an increase in demand and inflation would be in the range of 14.2 - 19.2 percent.

Yet, the district is asking the voters to approve a levy increase in excess of 50 percent -- without telling them that it would be an increase of more than 50 percent.

The editorial opinion does give a nod to the sort of information voters need:

If approved by voters, the tax increase to property owners will be modest; in 2007, it would amount to about $10 a month for the owner of a median-priced $256,000 home in Central Kitsap. That comes to about 33 cents a day. In exchange, residents would be helping maintain and improve fire district services that could save their lives and property.

But note that a house with an assessed value near the median would increase in assessed value by about 20 percent for taxes due in 2007. The county-wide average increase announced in July was 21 percent.

Assume the Sun got the median value right, and assume that it is the median for 2007. The median for 2006 would be less -- approximately $213,333 for taxes due this year.

At this year's tax rate of $1.04 per $1,000 the homeowner's regular fire district tax would be approximately $221.87.

If the lid lift is approved, the tax rate in 2007 would be $1.36 per $1,000, and the assessed value would be $256,000 -- resulting in a tax of $348.16.

The tax increase would be $126.29, which is a 56.9 percent increase.

So it is possible to figure out the magnitude of the increase from the information in the editorial plus knowledge about the extent of the increase in assessed values for next year's taxes.

Why not tell the readers and voters, rather than force them to sit down with pencil and paper (or calculator) to deduce the magnitude of the increase from the given information?

The answer appears to be obvious, once you realize the tax increase would exceed 50 percent.

Has the fire district justified such an increase, or has it hidden the magnitude of the increase with the assistance of the Kitsap Sun?

When this sort of thing happens more than once, it seems reasonable to suspect that the editorial staff at the Kitsap Sun know exactly what they are doing.