Tomorrow the citizens of the state of Alabama will have the chance to add to the copious number (nearing 800) of amendments to the 1901 Constitution. There are three statewide choices tomorrow. Numbers 1 and 3 are testaments to the failures of the 1901 document, insofar as they are very local matters that nonetheless have to be decided by a statewide vote. Amendment 1 would allow:
the City of Prichard to establish an Alabama Foreign Trade Investment Zone as a special tax district for the purpose of importing duty free and quota free articles eligible under the United States General System of Preferences and the Africa Growth and Opportunities Act,
Pretty heady stuff to be sure. The amendment is necessary due to prohibitions in the 1901 charter against allowing government entities in the state to promote business.
Amendment 3 proposes:
to provide for the election of the Macon County Board of Education from four single-member districts and the county at large, and to provide for staggered six-year terms of office
Which, it seems to me, is the business of Macon County, but I guess I get to weigh in anyway…
Amendment 2 is, for Alabama, controversial. It would:
to require the levy of an additional local ad valorem property tax in those school districts of the State in which local ad valorem property taxes for general public school purposes totaling less than 10.0 mils are otherwise levied, so as to ensure that such taxes totaling at least such amount are levied for such purposes in every school district in the State of Alabama.
It is controversial because it would, gasp! raise taxes. However, before everyone gets their panties in a knot, let’s note that it would be allowable for counties that do not already charge the 10 mil rate (most do, only 31 do not) to simple raise property taxes and lower sales taxes as an editorial in the Press-Register noted:
This isn’t about raising taxes. Most systems already collect this minimal amount, or more. The other 31 systems could impose the minimum and reduce sales taxes if they want to keep their tax load level.The important thing is that the amendment would require a minimum of property tax at the local level. Property taxes are the best way to fund public education because their revenues don’t fluctuate with changes in the economy.
Indeed, I would far rather pay slightly higher property taxes and have the City of Montgomery lower it 10 cent sales taxes.
The issue was well covered in a Montgomery Advertiser piece written by Jim Carnes of Alabama Arise:
Some reports have implied that the 30 systems with fewer than 10 mills of property tax for schools aren’t following the law. That’s not the problem. The fact is that they’re complying with current law when they use a mixture of property and sales taxes to come up with “10 mills or the equivalent.”So what’s wrong with a mixture?
The property tax is the most stable of the four major taxes. (The others are income, sales and business taxes.) Using the property tax for education can moderate the ups and downs of the budget roller-coaster caused by fluctuations in the state’s economy. Compared to the sales tax, property tax is also fairer, because it doesn’t take a bigger bite out of the household budget for low-income people than it does for higher earners.
Requiring all districts to provide a minimum of 10 mills in property tax for schools wouldn’t make all schools equal, but it would give every school system the same stable floor of funding. All of Alabama’s children, regardless of where they live, deserve that basic security (at a maximum cost - in only a few districts - of $30 more per year on that $100,000 house.)
When a measure of the common good such as average income or public health or education comes up short in Alabama, we often joke, “Thank God for Mississippi!” In this case, the joke’s on us: Mississippi’s lowest local school tax is 22.45 mills, and 80 percent of Alabama districts fall below that level. Amendment 2 won’t catch us up, but at least it will move us in the right direction.
The stability issue is also quite salient for Alabama, as anyone who has gone to school here and had to go through proration because of budget shortfalls can attest.
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Ah yes, I remember voting on all those constitutional amendments. Actually, my rule of thumb was that if it did not affect me whatsoever (like the Pritchard Business Zone thing), then I just left the line blank.
Comment by Mark — Monday, November 6, 2024 @ 9:22 pm
“insofar as they very local matters that nonetheless have to decided by a statewide vote.”
I think you are missing an “are” and a “be” in that sentence.
And thanks!
Comment by Jan — Monday, November 6, 2024 @ 10:15 pm
Here’s the hitch, though, Steven: if the local governments raise the property tax to the required level, will they concomitantly lower the sales tax? Realistically, how many tax decreses have you seen enacted at the local level? Unless the sales taxes are lowered, the net effect would be a tax increase.
Comment by Scott Gosnell — Tuesday, November 7, 2024 @ 6:32 am
[…] Steven Taylor at Poliblog has an excellent post explaining Amendment Two on the ballot today. Essentially, Amendment Two, if passed would require county governments to enact a minimum 10 mil property tax for schools, assuming they don’t already fund them at that level. 31 of the 67 counties are not already funding schools at that minimum through property taxes — many make up the difference through other taxes, primarily sales tax. […]
Pingback by Pros and Cons » Local Politics Post — Tuesday, November 7, 2024 @ 6:42 am
I was wondering about Scott’s point as well.
Comment by Jan — Tuesday, November 7, 2024 @ 7:29 am
Scott is correct.
However, given a) that we area talking about probably a $30/year per 100,000 valuation on one’s property taxes, it is a risk I am more than willing to take. Money is not the solution to all our education woes, but anyone even passingly familiar with Montgomery County schools knows that money is part of the problem. I would vote for the 10 mil minimum even if that’s all there was on the ballot.
So yes, it could potentially be a tax increase.
Of course, given that it might be, I expect it to lose today–because this state gets a rash about raising taxes.
I am not a fan, in general, of raising taxes but do think that we well-underpay in terms of property taxes for schools. And, as a result, I think that we end up paying for it, so to speak, in terms of economic output ultimately because of under-educated students and the fact that lousy schools make it far, far less likely that we can attract businesses to invest here.
Comment by Dr. Steven Taylor — Tuesday, November 7, 2024 @ 9:03 am
[…] I think Scott actually missed the “best” part about Amendment 2, as did Dr. Taylor. I heard an ad on the radio last night telling me that I, as a privileged and highly taxed resident of Jefferson County, will not have to pay anything if I vote for Amendment Two. It’s like voting to increase taxes on the Britons to fund some worthy scheme. We think the killing in Darfur should stop. Let us then order the Egyptians to get involved, or something like that. […]
Pingback by Pros and Cons » Vote no on Alabama Amendment 2 — Tuesday, November 7, 2024 @ 9:23 am
[…] Scott G and Honza P from Pros and Cons both take issue with my views on Amendment 2 on today’s Alabama ballot (which I discuss here). Both raise legitimate issues: Scott notes that while Amendment 2 doesn’t require a tax increase (because counties could decrease sales taxes), it probably will be a tax increase and Honza argues that since the voting only affects some voters, but not all, it is problematic for a voter in an unaffected country to vote at all. […]
Pingback by PoliBlog ™: A Rough Draft of my Thoughts » More on Alabama Amendment 2 — Tuesday, November 7, 2024 @ 9:58 am
Folks, no one likes taxes and I also agree that taxes should be low. Some of you appear to want the government to run on magic. 10 mills IS low, very low as a matter of fact. These counties have freeloaded off the rest of the state via lawsuits and the Foundation funding program and need to get in gear. This is really mild in the scheme of things.
Comment by John Hay — Tuesday, November 7, 2024 @ 11:15 am
John: exactly.
Thanks.
Comment by Dr. Steven Taylor — Tuesday, November 7, 2024 @ 11:53 am