Tax and Spend Republicans??

       This first part was an earlier response to a friend who sent me an article several months ago from the Orlando Sentinel regarding the increase in county millage rate.  As usual, the young woman who wrote it was ignorant in many areas, including economics, where she, like the current President, just doesn’t get it. After the earlier part I have written an addendum, based on my amazement that many of my liberal Democrat brethren also seem not to “get” the economics involved.

       "Interesting article but, as usual, based on partial information and fudged data. There is no doubt that the 2020 Sumter county mil rate will increase by about 20%. It needs be specified that the figure is year to year. Nowhere in this biased piece of op-ed does it mention the “rest of the story” as Paul Harvey used to say. The Sentinel has been anti-Villages from day one for reasons I have yet to fathom.  The Villages isn’t in Orange county, so it really isn’t their problem in the first place.

        It is undeniable that The Villages has had major impact on Sumter County and until this year, no one has complained because it has also meant job creation and employment in many service industry sectors. 

        It is also undeniable that Sumter County has focused a significant level of “going the extra mile” on the Villages area from libraries to county service centers to the best damned driver’s license renewal experience ever in the world. This in spite of the fact that Villages is unique among Sumter population centers in paying local taxes, not to the county but to a CDD, in the form of amenities fees which controls the spending to local interests.  One can argue “water use”, etc. but there is no evidence to support any such negative impact. No one, however, in the Villages really has a gripe, since much of the expansion of law enforcement and public safety directly affects us, as do many, if not most, of the road construction and repair expenditures.

  

       A significant issue is that many folks look at the immediate and eschew the change over time. This precisely the same phenomenon as those who bitch continually about the price of gas, while in truth, adjusted for inflation, even at $2.50 per gallon, it’s cheaper than it was in 1955. One more example: a 2005 Ford Escape (entry level) cost $19,425 in 2020 the entry level Escape costs $25,980. That’s 33% more. Who’s complaining?

        In 2008 the Sumter county millage rate was 5.89, but that was down from a 2005 rate of 7.8! (that, even unadjusted for inflation is 15% HIGHER than the recently adopted 6.7 % for 2020. Understand, that, from 2005 to 2020 even without adjustment for inflation, the millage rate is lower. 

       Had the Sumter County Commissioners decided in 2008 to simply index the millage rate to the CPI, the new rate would be 7.26 (.5 higher).  Adding adjustment for the CPI increase over time means in real dollars that the effect of the new increase is more like 16% lower than 12 years earlier, since the inflation rate over the period 2005 to 2020 (projected) is 23.4%.

In simpler terms. Let’s assume a house valued at 400k. For simplicity’s sake and because it’s been ages since I took statistics, let’s assume what is unknowable, which is a uniform appreciation of 2% annually (remember this period includes “the bubble” collapse). What I will do is take the historical mil rates at several points between 2005 and the proposed 2020 and average them. That gives an average rate 2005 to 2019 of 6.25 millage, but wait, taking just the 2008 rate and adjusting for inflation, which would have raised no eyebrows, or shouldn’t have, in any case, yields an adjusted rate, even if only inflation was considered, of 7.2, which is .5 higher than the new rate.

So? So it takes a broader view than some obviously have, to understand that while the new rate is a 25% jump, which seems high, it really reflects years of lower taxes, since infrastructure (roads) were new and required little maintenance or as is being done currently, resurfacing and pothole repair on county roads.

       One can argue Villages expansion is excessive, but that’s a relative opinion. When roads were new and what existed was sufficient, millage rates were still sometimes high, but over the past 8 years have decreased, unlike the cost of just about everything else we pay for. In that, Sumter County was unique, and gave taxpayers a break because they could. People in Bunnell might have a real reason to complain, because they (with some justification) see the new rates which affect them as well, as being due to Villages expansion. They will bitch about this while they are driving to their jobs working new construction in Fenney, or to their Mike Scott plumbing job in the Villages, etc., etc.

       If, in 2005, Sumter had simply said, “We won’t increase millage rates for the next 15 years”, church bells would have rung out in celebration, and the 2020 millage rate would still be, even unadjusted for CPI increase, 7.8%!  In fact, they reduced rates. Name one other facet of economic life which decreased in cost over the last 8 years. Can’t? Me neither. Still, being economic dunces, many will bitch about paying the new rate and ignore the significant savings of the last 15 years."

  Addendum: 7/17/2020   

I note with some bewilderment (in light of the real numbers in the piece above) the efforts of some to remove the current county commissioners based, apparently only on the recent tax increase. The rub here is that much of the tax increase was occasioned by escalating infrastructure needs of Villages expansion south of CR 44. Many are so short sighted that they can’t seem to see the new paving on Buena Vista, or the other road work funded by tax dollars. Meanwhile Orange County taxpayers are dealing with potholes and paying an effective 18% property tax.

        And here’s the other thing the Villages should just keep shtum (shut up) about. As an unincorporated “town” the CDD residents don’t pay local taxes on top of county taxes.  

      Yeah, that’s correct; residents of Bushnell have the “privilege” of paying another 3.8% on top of the relatively low county appraisal. I’m a liberal Democrat. I’m also fiscally literate. This apparently is not universally true among Democrats. Adjusted for inflation, let me repeat, the current millage rate for Villagers is 16% less than it was 12 years ago. Is anything else you buy, (other than Chinese TV sets) cheaper now ?   I thought not.

        And, finally, I recently read a “Talk of the Villages” post implying that increased revenues will go “into the pockets” of the commissioners. Only if they embezzle it. Salaries are determined by a 2017 act of the Florida legislature and for county commissioners are “slotted” into levels based on the population of the constituency served. In other words, a Dade or Duval county commissioner makes a lot more than a Sumter commissioner, but neither can “vote themselves a pay raise.”   Sumter County gets good service and the Villages get exceptional customer service and road work. For a decade, as the CPI increased, taxes went down. The sudden spate in growth (Fenney, Chitty Chatty, etc.), all involves new or improved county roads. This boom has created short term debt, which part of the raise in millage rate is aimed at retiring. Much of that expansion is in Sumter County.  Simple, really, when you really think instead of just react. That’s more like the other guys.