DrStrange
4 of a Kind
I am trying to understand how fiscally conservative political leaders find themselves being irresponsibly short sighted. I have a specific personal experience, but this problem is writ large at every level of government. I think I could find a wire story every day that provides examples of "penny wise / pound foolish" decision making that leaves me shaking my head wondering how so many things like this happen. And lets be clear, while both political parties can fall prey to this class of errors, the current generation of Republican leaders are especially vulnerable to this type of error.
In my part of Texas, we provide fire and EMS services through special taxing districts that can levy property and/or sales taxes to pay for the services. These are self imposed taxes, meaning the voters decide if they want fire and EMS services and if so set a cap for the maximum tax allowed. State law sets the largest tax at ten cents per hundred dollars of property value - so $200/yr max tax for a $200,000 home. We have about a half dozen such districts in my county providing EMS services. I have served as treasurer for one district for over a decade. (unpaid, selected to serve by the County Commissioners Court.) Our taxes are about 60% of the max, $120 per year on the average home.
It is important to know that a district can only make minor adjustments to their tax rates (if below the cap) without getting voter approval. So if you cut the tax rate in prior years, you can't just restore it when needed - you have to ask permission from the voters. Permission isn't a given in Texas, even if it might be a matter of life or death. I hear from a few tax payers each year that beleive poor people who can't pay just should be left to getting to the hospital on their own.
Over the years, the amount insurance (both private and public) will pay for ambulance services has fallen well below the cost of providing the service. This is especially true for rural services, it costs us $1,500 per run and we get $500 from insurance. Indigent care means more than just abjectly poor people can't pay. Mostly for us it means lots of elderly patients who can't afford a thousand dollars to make up the balance due. So these districts are subsidizing the insurance payments with tax dollars. (this happens in cities too, but it is blended into the overall city budget. For us it is a line item on every tax payers' bill each year.)
The state has refused to take the Medicaid expansion built into the Affordable Care Act which carries with it a big cut in uninsured reimbursement from the Federal Government phased in over several years. That means the local governments are going to lose millions of dollars of funding that once defrayed part of the cost indigent care. All of us knew this was coming and had seven years to plan. It represents about 30% of our budget. The cuts will hit October 1st this year.
So my district held our tax rate higher than needed to build reserves, knowing the subsidies were temporary. We have enough money to easily weather the loss of state and federal assistance. Not only that, but we can afford to keep higher than required medical staff. We have some of the highest quality staff on our ambulances in the state and respond with more resources than any other service in the county. Something that saves a few lives every year, but does cost extra.
The other EMS districts cut their tax rates and built the subsidies into their income streams. In the most extreme case, they cut the tax to $60/year per home when their actual costs were $130/yr per home. That decision is proving costly. The other districts are needing to double their tax rate this year. As might be imagined, this generates a lot of conservative opposition. Enough that the tax rates may not be allowed. The net effect is some parts of the county may end up with EMS service for the daylight hours but rely on "on-call" unpaid/low paid staff at night. All these districts are staffed with the lowest level of trained staff allowed by law, adequate but rarely it will make a difference.
So I wonder, how can they not have seen this coming? The local tea party made great efforts to capture control of these small taxing districts, sliced the rates as far as possible, but had to know the subsidy was ending. These services aren't optional. When you dial 911 with a medical emergency, even conservatives expect rapid professional EMS services.
A lot of my neighbors are going to suffer in the coming years over not paying $5/month in property taxes. That seems to me to be irresponsibly short sighted and I just can't see how it could be politically popular or prudent.
DrStrange
In my part of Texas, we provide fire and EMS services through special taxing districts that can levy property and/or sales taxes to pay for the services. These are self imposed taxes, meaning the voters decide if they want fire and EMS services and if so set a cap for the maximum tax allowed. State law sets the largest tax at ten cents per hundred dollars of property value - so $200/yr max tax for a $200,000 home. We have about a half dozen such districts in my county providing EMS services. I have served as treasurer for one district for over a decade. (unpaid, selected to serve by the County Commissioners Court.) Our taxes are about 60% of the max, $120 per year on the average home.
It is important to know that a district can only make minor adjustments to their tax rates (if below the cap) without getting voter approval. So if you cut the tax rate in prior years, you can't just restore it when needed - you have to ask permission from the voters. Permission isn't a given in Texas, even if it might be a matter of life or death. I hear from a few tax payers each year that beleive poor people who can't pay just should be left to getting to the hospital on their own.
Over the years, the amount insurance (both private and public) will pay for ambulance services has fallen well below the cost of providing the service. This is especially true for rural services, it costs us $1,500 per run and we get $500 from insurance. Indigent care means more than just abjectly poor people can't pay. Mostly for us it means lots of elderly patients who can't afford a thousand dollars to make up the balance due. So these districts are subsidizing the insurance payments with tax dollars. (this happens in cities too, but it is blended into the overall city budget. For us it is a line item on every tax payers' bill each year.)
The state has refused to take the Medicaid expansion built into the Affordable Care Act which carries with it a big cut in uninsured reimbursement from the Federal Government phased in over several years. That means the local governments are going to lose millions of dollars of funding that once defrayed part of the cost indigent care. All of us knew this was coming and had seven years to plan. It represents about 30% of our budget. The cuts will hit October 1st this year.
So my district held our tax rate higher than needed to build reserves, knowing the subsidies were temporary. We have enough money to easily weather the loss of state and federal assistance. Not only that, but we can afford to keep higher than required medical staff. We have some of the highest quality staff on our ambulances in the state and respond with more resources than any other service in the county. Something that saves a few lives every year, but does cost extra.
The other EMS districts cut their tax rates and built the subsidies into their income streams. In the most extreme case, they cut the tax to $60/year per home when their actual costs were $130/yr per home. That decision is proving costly. The other districts are needing to double their tax rate this year. As might be imagined, this generates a lot of conservative opposition. Enough that the tax rates may not be allowed. The net effect is some parts of the county may end up with EMS service for the daylight hours but rely on "on-call" unpaid/low paid staff at night. All these districts are staffed with the lowest level of trained staff allowed by law, adequate but rarely it will make a difference.
So I wonder, how can they not have seen this coming? The local tea party made great efforts to capture control of these small taxing districts, sliced the rates as far as possible, but had to know the subsidy was ending. These services aren't optional. When you dial 911 with a medical emergency, even conservatives expect rapid professional EMS services.
A lot of my neighbors are going to suffer in the coming years over not paying $5/month in property taxes. That seems to me to be irresponsibly short sighted and I just can't see how it could be politically popular or prudent.
DrStrange
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