Prop 2 1/2 has become the gate keeper and should stay: confessions of a convert

As editorial director of WCVB-TV, Channel 5, I was an ardent opponent of Prop 2½. I thought it arbitrary to cap a city’s or town’s property tax levy to 2½ percent of the previous levy, unnecessarily tying the hands of local officials trying to cope with changing financial circumstances. Much of that is still true, but increasingly I have come to believe that, without 2½ there would be substantially less accountability to local taxpayers, essential in good times and bad.

Local officials seeking to override the 2½ cap have to go to the voters for approval to override. And it is those referenda that provide accountability. Communicating with transparency is the sine qua non for building that trust in local government without which an override is next to impossible.

The MA House this week killed a plan offered by Ways and Means Committee Chairman Charles Murphy allowing communities a way to circumvent 2½. Essentially the deal was to let cities and towns convert their overlay accounts (monies set aside for tax abatements, now factored into their annual budgets) into free cash (up to five percent of their total budget), to be used however they wish. It’s far easier to understand debt exclusion overrides than this latest ploy, which would not even require voter approval.

(Barbara Anderson of Citizens for Limited Taxation may be one of the only people in the Commonwealth to understand completely how this would be achieved, and she will be writing on this for the Salem News later this week. )

And that’s my point. This recent Ways and Means strategy gives property taxpayers a sense that someone’s trying to put something over on them. It is anything but transparent in the process and, if passed, would reduce accountability by local officials.

How important is transparency? Take the case of Newton, for example. In 2002, voters felt good about the city administration and passed an $11.5 million override referendum to support city and school services. But, by 2008, having lost faith in Mayor David Cohen and angry about a nearly $200 million new high school (dubbed a Taj Mahal by Boston Globe editorial writers), voters rejected a $12 million override for city and school services. They didn’t believe that City Hall was doing everything humanly possible to trim expenditures, and they weren’t going to pay more money without that confidence.

Today, like many cities, Newton faces a structural deficit exacerbated by employee health and pension costs. New Mayor Setti Warren pledged not to ask for an override his first year in office, but a referendum may be unavoidable next year. He held informational meetings in all eight wards prior to filing the FY ’11 budget. He seems to understand that constant contact and relentless education to engage taxpayers in the decision-making process must be part of the equation.

Cities and towns are not irredeemably opposed to override referenda. A look at the MA Revenue Department data base shows that maybe half of them succeed, though the MA Municipal Association says the recession has understandably slowed that process. In good times and in recession, however, taxpayers need to know that their tax dollars are being spent responsibly, that every conceivable effort is being made to prune budgets, and that, if an override referendum is called, it is absolutely a last resort.

Good for House Speaker Robert DeLeo, Senate President Therese Murray and Governor Deval Patrick for taking a stand against the Murphy move to circumvent the Prop 2½ trickery.

Please let me know your thoughts in the comments section below.

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