The voices of Tax Policy Center's researchers and staff
Chicago Mayor Rahm Emanuel: Without school pension money from the state, property taxes will jump. Facing a tough runoff in his race for reelection, Emanuel is looking for fiscal help from the state, including from its GOP governor. He wants the state to help fund pensions for Chicago’s teachers as well as make other changes that would let the city delay its contributions to public employee retirement funds. Oh, and he’d like the state to green light a casino in the city. According to Emanuel, “Unless we are able to collaboratively pass legislation to modify our pension structure and put in place a smart funding formula, property tax bills will explode next year.” But Springfield has its own problems. Last week, the State Supreme Court heard arguments in a challenge to Illinois’ pension overhaul plan.
County Executive in Maryland: Property taxes should go way up to pay for schools. Prince George’s County’s Rushern L. Baker, a Democrat, would like a 15 percent hike in property taxes—as well as layoffs and furloughs—to pay for schools, public safety, and economic development. For his $3.63 billion budget to advance, he’d first have to get around a 1978 law requiring voter approval to raise property taxes. Baker thinks a 2012 state law that shifted teacher pension costs to local governments allows him to exceed local property tax caps to maintain school funding at levels required by the state. The County Council has to adopt a budget in June.
In Utah, perhaps a New Year’s gas tax hike. The state faces an $11.3 billion transportation funding shortfall in its 30-year plan, so lawmakers have advanced a bill to raise the state’s gasoline tax by five cents per gallon in 2016. That’s half a penny less than the increase Utah saw between 1993 and 2014. If Governor Gary Herbert signs the bill, the state’s gas tax would be 29.5 cents per gallon starting January 1. Under the bill, once the wholesale price of gasoline reaches $2.45 per gallon, the tax would change to 12 percent of the wholesale price, with a cap at 40 cents per gallon.
A sales tax is no longer enough in Santa Fe, New Mexico. The city’s gross receipts tax, or sales tax on purchases of goods and services, “ain’t what it used to be,” says Oscar Rodriguez. The city’s new Finance Director notes that given the economy, changing demographics, and the growth of online shopping, the city sales tax has brought in $10 million less since 2008 after accounting for inflation. Says Rodriguez, “[T]here will have to be a significant conversation about restructuring public financing. The idea that you could live off what’s generated through sales taxes is no longer true.”
A tax felt like a slap at a hotel in Charlotte, North Carolina. Earlier this month, the CIAA, a mega-tournament for basketball teams at historically black colleges and universities from Pennsylvania to North Carolina, was in town and the Ritz-Carlton hotel charged a $10.20 “CIAA SVC CHRG” to customers of its lobby bar. The hotel says “the service charge was not intended to single out any particular group or organization.” Charlotte Regional Visitors Authority CEO Tom Murray says he hasn't heard of a lobby surcharge at other regional hotels during CIAA week, or ever. North Carolina’s attorney general has directed the state’s department of consumer affairs to investigate the hotel's fee, which has been called a “black tax.”
Today on the Hill. The Senate Homeland Security and Government Affairs Committee holds a hearing on errors in the Social Security Death Master File and incorrect federal tax payments. Witnesses include: Judy Rivers of Logan, Alabama; Sean Brune and Patrick O’Carroll, Jr., of the US Social Security Administration; David Mader of the Office of Management and Budget; and Beryl David and Daniel Bertoni of the US Government Accountability Office.
Interested in subscribing to the Daily Deduction, the Urban-Brookings Tax Policy Center summary of the day’s tax news? Sign-up here to get the Daily Deduction delivered to your inbox every morning. If you’d like to tell us about a new research paper or have any comments about our feature, write us at email@example.com.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.