RES PUBLICA - Gloversville, NY Edition

Former Councilwoman Cynthia Morey (2004 - 2007) called up during the 4-12-08 Talk of the Town radio show (AM 1340 WENT) to discuss the idea of switching to a fee for various city services (fire, police, and some DPW functions, including garbage collection, were mentioned).

She said the idea had been brought up in the past, but no one had acted on it yet. That is true.

As a colleague of hers at the time, I was, and remain, in favor of the idea of Fee for Service, but I am not in favor of requiring non profits and not for profits* to participate.

Let me explain.

Cynthia and I agree on a great many things. The issue of making non profits/not for profits pay for service is, apparently, not one of them. That happens. Hopefully she won't hold it against me!

There is a constant underlying belief that non profits/not for profits are sucking the financial lifeblood out of Gloversville. In the fall of 2004, someone suggested to me that reducing the number of non profits/not for profits in the city would be one solution to help Gloversville recover financially. I then embarked on an informal study of the non profit/not for profit situation in the city and was amazed to find out how utterly untrue that common mythical belief, as espoused by one of my constituents, happens to be.

When city, county, state, federal, and school district properties are removed from consideration because they are untaxed, and when Economic Development Corporation properties (the Gloversville Crossroads and Business parks, and the Estee Commons project) are removed because they fall under a progressive taxation system separate from regular taxes, but are still taxed.....

..... what is left amounts to just 12.4% of the total potential taxable property of the City of Gloversville.

The majority of these properties (11.49%) are houses of worship. The second runner up (.91%) consists of the 14 properties owned by The Lexington Center.

There are three reasons why charging a fee for service to houses of worship is a really bad idea:

1. Churches perform good works in the community in lieu of taxes or fees

Parishioner donations are given to operate the organization and support the good works of the church in the community.

To require those funds be given instead to the "tax" man or "fee" man depletes the group’s ability to give back to the community through the socially supportive programs the church(es) supply at no cost to the taxpayer.

The unintended consequence of siphoning off funds for the city could be to induce people to give less since they realize their money is simply going to feed government services. It could also cause greater needs issues among poorer residents of the city which only government could meet, potentially raising taxes far more than the value of the "fees" received from these churches.

2. Parishioners, who are Taxpayers, already pay for the services the church receives

This mindset was explained to the Common Council in 2004 through an open letter by Reverend Splittgerber of the Kingsboro Assembly of God Church to the Common Council, when the Fair Share program was being championed by former Councilman-at-Large Duke Caruso (2001 - 2004), that churches are not businesses. They are, in Reverend Splittgerber's words, "... a Body of People. Without the people there is no "church."

And who makes up this “Body of People?” People who are, by and large, already residents of the city.

That means these folks, either through their ownership of property, or through their rental agreements, pay into the taxation system already.

I don't know about you, but when I leave my home I fully expect that the taxes I've paid on my residential property entitle me to full police and fire protection regardless of where in the City of Gloversville I happen to be at the time of need.

So, if I have a heart attack in my house, or in my church, I'm covered. Why should my church have to pay a second time? If I am assaulted in my house or in my church, why should I have to pay for police protection with my property tax AND with my tithes and offerings? If the building catches on fire, why doesn't my fire protection, again bought and paid for with my taxes, cover me regardless of the structure I happen to be inhabiting at the time?

3. Using property value as a way of calculating the fee

While the only other statistically significant portion of the non profit/not for profit pie is comprised by The Lexington Center, I am troubled by the mindset that first inflates Lexington's overall effect within the City of Gloversville, and then uses the antipathy some residents have toward that organization to attempt to convince us that if all non profits/not for profits were paying a fee for the services they receive, we would significantly reduce the cost of services to the residents in the city.

It will have no such effect.

If we choose, for a moment, to avoid taking into consideration the potential increase in social services related costs incurred by a reduction or elimination of social programs currently provided at no cost to the taxpayers by city churches, we must take into consideration the fact that the actual number of churches in the city is just not that statistically significant, when it comes to the idea that including them in a fee for service plan will somehow help dilute the amount taxpayers currently pay.

Certainly, if one is expecting to dilute the overall cost of, say, garbage pick-up by including all of the churches, the math on that doesn't agree. At best, homeowners might save a few dollars annually - and by a few I mean A FEW, like $3 or less per year (not per thousand) - if they're lucky.

Pursuing this notion can only hope to create a huge amount of heartache and have far reaching effects throughout our social support and quality of life infrastructure which will vastly exceed any financial return to the city.

It should not be entertained.

* Non-Profit: A legal structure authorized by state law allowing people to come together to either benefit members of an organization (a club, or mutual benefit society) or for some public purpose (such as a hospital, environmental organization or literary society). Nonprofit corporations, despite the name, can make a profit, but the business cannot be designed primarily for profit-making purposes, and the profits must be used for the benefit of the organization or purpose the corporation was created to help....

** Not for Profit: A subset of the classification of Non-Profit dealing largely with associations, trusts, and societies.

I recently had the rare good fortune to listen in on Talk of the Town. One of the topics of discussion was the creation of a quarterly payment plan for city taxes. A gentleman called up wanting to know why it wasn't possible to do this. He was, apparently, frustrated that it was so difficult for him to get his taxes together annually.

While Councilman Castiglione did call in as well and say he would look into that, I can tell him right now (having already looked into the matter three years ago) that the primary reason it cannot be done is that it would undoubtedly require the dedicated services of a finance employee - a finance employee who does not currently exist - meaning a slight raise in taxes or decrease in some other worthy city business, to hire a new employee.

If the city feels it is in the financial position to make that happen, then by all means go for it.

I still think it is a waste of time and effort.

The caller's problem has nothing to do with an inability to pay annually. The problem is his inability to budget effectively. Changing payments to quarterly may seem like an adequate solution, but one has to ask oneself how that is supposed to improve his apparent inability to budget monthly. All he has to do is remove $XX from his income every month to cover the cost. Why is either he or the local government supposed to believe paying every three months will make that process easier? It is budgeting 101. He either has it, or he doesn't.

Another reason this is a waste of time is that there is already this really cool little financial vehicle known as an Escrow Account. True, when people pay off their homes their escrow account often goes away too; but it doesn't have to.

Anyone can set up an escrow account and make regular payments into it. Let a for-profit financial institution cover the cost of the labor necessary to do this function, rather than forcing the city, and therefore the taxpayers to (I hate to be obscenely rude here but...) foot the bill for one guy who apparently is incompetent at managing his money.

That's my position, and I'm sticking to it.

Lance