Tax rates matter, and people playing class warfare over the property tax bills of people in their town may be missing the way in which that drives up taxes on the working class.
With his criticism of Democrat Governor Gina Raimondo for appointing Democrat Senate President Dominick Ruggerio’s son, Charles, to the Narragansett Bay Commission, Republican Mayor of Cranston Allan Fung has drawn attention back to the City of Providence’s perennial effort to turn its big water asset into a one-time payment, largely to infuse the city’s pension system with cash.
The immediate controversy is that Ruggerio, the younger, works in multiple roles as a lawyer for the city, but his appointment is most significant as a flash point to illustrate how government works, in Rhode Island. The city has been after this for years. In 2013, it took the form of an objectionable regional water authority. Now, the strategy is to bring in the quasi-public Narragansett Bay Commission.
In every case, the goal appears to have been to come up with some excuse to saddle taxpayers and/or ratepayers with the additional burden of that one-time payment to the city.
Making matters worse is the general evidence that thinking about pension funds in this way is a mistake. Just after the turn of the century, for example, the City of Woonsocket took on debt with the calculation that its investment returns would exceed the interest, and it could get its pension system on track. That didn’t work out so well.
The Providence deal is different, of course, and would require a more thorough review prior to decisive pronouncements, but the impression one gets is that the primary difference is that the Woonsocket deal saddled the same people who owed the pension debt with the bond debt, while Providence is looking for somebody else to take on the new debt. Of course, Providence will also have offloaded an asset as a one-time part of the deal.
It’s always shocking to see relativism win in court, and it raises fears about what it means when people can’t expect justice founded in mutual respect for facts and logic.
Last night, Tiverton’s Board of Canvassers decided that it had the authority to pick and choose what voters could vote on based on their feelings about it. The Town Council is hostile to the resolutions, and the town solicitor, who serves in his $98,000-a-year position at the pleasure of the Town Council, told the canvassers that they might face a complaint if voters passed the resolutions.
Never mind that the board was nearly certain to face complaints for blocking the resolutions and the solicitor couldn’t say which lawsuits would be more likely to win. The canvassers chose to disenfranchise electors rather than do something that the Town Council didn’t want.
As I write on Tiverton Fact Check:
This is the Board of Canvassers. They’re supposed to be completely neutral referees making sure that all sides in a political dispute have equal access to the ballot. In this case, the Town Solicitor — who has $98,000-plus reasons to do whatever the Town Council wants him to do — said people might file complaints against the town if voters agreed with the resolutions, and the Board of Canvassers decided to take the vote away from them.
It would be hard to overstate how shocking that is. Tiverton’s Home Rule Charter states that “All… Elector Resolutions shall be included on the ballot for the Financial Town Referendum and presented at the Financial Town Hearing provided that they are accompanied by 50 qualified elector signatures.” There is absolutely no dispute that the resolutions the Board of Canvassers blocked had 50 signatures and followed the process in every way, because they followed the same process and had almost identical signatures as other resolutions that were not blocked.
Once again, government officials in Rhode Island show their belief that the law is whatever they say it is at any given moment. Hopefully, a judge will conclude differently.
A headline proclaiming that “Divorce is contagious” probably ought to spark the immediate reaction, “of course it is.” As the essay suggests, all of these big life events are contagious. I observed among my wife’s friends as well as other circles of friend clusters that marriages, child births, divorces, and other relationship events that seem mainly between a husband and wife seem conspicuously to spread around a group of female friends.
Writes Bek Day:
There is a big social component to the times at which we each decide to make major life decisions like marriage – including, research suggests, when and if those marriages end.
According to a study conducted across three US universities, you’re 75% more likely to get divorced if at least one member of your close friendship circle ends their marriage.
Researchers arrived at this extraordinary figure using a longitudinal study which examined participants over a 32-year period. Their findings, published by the National Center for Biotechnology Information showed that divorce was something that could be passed on through ‘social contagion’.
That’s why we have to make marriage contagious. As I wrote again and again during the same-sex marriage debate, the designation matters because it allows those of us who maintain long-term relationships with the other who is significant because we two have created children to invest the institution with meaning. (That applies even among couples that have no children, provided their relationship does not contradict the ability to create children as a central premise… that is, provided one is a man and one is a woman.)
So, to counter the contagion of divorce, we have to have marriages that neither person wants to leave and that other people would take as a model. That means we must take seriously our responsibility to seriously work out our differences, and in the end, that is most likely when we enter the relationship with the understanding that divorce is simply not an option. It also means those considering divorce should consider how their decisions will affect those around them.
Yes, marriage is a two-person relationship, but its effects are much broader than that.
Whether it’s removing market signals with a value-added tax or creating incentive to block new children through zoning, public policy shouldn’t remove its red flags and should seek to address original problems, not symptoms.
Regular readers know I put a lot of emphasis on incentives as a way to understand events and a key consideration when crafting policies. The $250 million school bond proposed for the November ballot is a good example.
On the front end, the incentive is very strong for school districts and municipalities to let facilities deteriorate. First, the law is structured to give advantages to labor unions organized at the state and even federal level, creating incentive for them to manipulate the political structure. Then, elected officials have incentive to tilt budgets toward organized labor, drawing money to compensation. Next, having learned from that experience over time, taxpayers have incentive to squeeze money out of budgets so that even higher taxes aren’t paying again for things like maintenance that they thought were already included and that might be diverted again if available.
On top of it all, the near certitude of passing bonds for dire repairs creates disincentive for regular maintenance from the start. This mechanism creates incentives for financial interests and investors, and the bias toward big projects brings in the incentive that got me thinking of these things. As Dan McGowan reports for WPRI:
Fix Our Schools R.I., a 501(c)4 nonprofit formed last week, will spend the coming months “educating communities across the state about what this plan is and how it would affect them,” Haslehurst told Eyewitness News. …
The organization lists its address as 410 South Main St., the same building as the Laborer’s International Union of North America. Haslehurst said it will share space with the Occupational and Environmental Health Center of Rhode Island, a nonprofit that has an office inside the building.
A quick look at the health center’s IRS filing shows that it’s a labor union organization, with AFL-CIO poobah George Nee as the treasurer.
‘Round and ’round the incentives go, to the point that running things efficiently — in the way people run their households, planning ahead and all that — seems almost to be an impossible task. Be skeptical of anybody who tells you that this is a “once in a generation” investment that fixes a problem. After all, when the debt payments subside, the incentive will be to find more projects in need of debt or to build the payment amount into regular budgets.
The governments of Fall River and Tiverton are utilizing their property for reasons that show shifting property to government doesn’t ensure that it will always remain sacrosanct.
In 2015, I presented Lawrence, Massachusetts, as a cautionary tale of the government-plantation economic model. Just as industrialists once attempted to draw in foreign labor to the “company town” because it was less expensive, the local government is turning the city into a “government town,” whose main source of income is transfer payments from outside to pay for government services.
Consequently, this recent Boston Globe article caught my eye:
The federal government’s relentless assault on the feared MS-13 street gang in Greater Boston continued this week, with two members of the violent outfit admitting to their roles in the 2015 slaying of a 16-year-old boy in Lawrence, authorities said.
True, immigrant gangs are nothing new to the United States, and homegrown gangs certainly exist. Still, tracing the arrival of an international criminal enterprise is a necessary task, and one needn’t indulge too much in speculation to propose that using immigration to bolster the population in need of government services leaves a region vulnerable to this sort of invasion.
So what happened with the disruptive snow and wind we were supposed to get yesterday? That’s the question of the morning. Something seems to have changed in the Rhode Island psyche after the “December Debacle” in 2007. That year, the timing and handling of a snow storm, particularly in Providence, under Democrat then-mayor-now-congressman David Cicilline caused a nightmare for commuters and children. Suddenly, hesitation to disrupt our entire community gave way to being “better safe than sorry.”
Once that old New England toughness lost its dominion, the ordinary incentives of government and politics took over. If the governor or mayor closes down government and implements parking bans, not only do they give some key constituencies a day off, but they mitigate the risk of something going wrong. Relatively few Rhode Islanders will even think to wonder about considerations like this, as expressed in a GoLocalProv article appearing this morning:
“Let’s go macro,” said [Providence restaurant owner Bob] Burke. “On any given day the state has $150 million in economic activity. What did we produce [on Wednesday] — $10 million? Are we a state that can afford to give up $100 to $125 million in economic activity without a really tough fight? On Wednesday, they went down in the first round!”
Similar views were expressed by Mike Stenhouse, CEO of the RI Center for Freedom and Prosperity. “The lack of concern for small businesses by bureaucrats and elected officials looking to make themselves look good – when they prematurely issue parking bans, large truck bans, or shutting down government operations – directly leads to a loss of business and productivity in the private sector,” said Stenhouse.
Whatever it is that’s changed in the Rhode Island psyche has freed government officials from the need to actually make decisions. Either business people have given up trying to assert their influence in an often-hostile government or those who take the needs of businesses lightly have increased.
Perhaps the change has to do with the “government plantation” that effectively replaces Rhode Islanders who are driven to turn their time into money with others who are more likely to seek government services. Those who work for government get paid no matter what, and those who are the recipients of its beneficence are a step removed from caring about where the money comes from.
When teachers retire early, they can continue to receive health insurance under the School Department’s plan until they reach the age of 65. Then they go onto Medicare’s Plan 65. That is provided for under the labor contract.
These early retirees had been receiving dental insurance and life insurance until age 65 as well. However, the School Committee determined those benefits were a “past practice” not included in the labor contract, and ended them as of Nov. 16 last year. Now, however, the five teachers who announced their upcoming retirement well before November will receive the dental insurance and life insurance until they reach age 65 as well.
One could argue that the “compromise” was that the school committee is not barred from changing this absurdly generous benefit going forward, but then, the unions aren’t barred from renewing their inappropriate tactics. They haven’t even been chastised for using them already.
The union has simply said that it won’t do something it never should have threatened to do in the first place.
This episode again emphasizes the imbalance in our government, especially in our schools. The labor unions are essentially in place for eternity, once certified, so when they aren’t able to win the political contest over the school committee, securing friendly “opposition” in negotiations, they are free to simply make the job difficult until new people are in place. The incentives are for the union constantly to push the envelope and for the school committee to be maximally accommodating.
So, over time, school committees across the state have allowed a system to develop that fails students and robs taxpayers.
I’ve been slow to share it, here, but the recent Providence Journal editorial on the return of perpetual-contract legislation to the General Assembly is important to read and take to heart:
Like a painful rash that keeps returning, the idea of “evergreen contracts” is back before the Rhode Island General Assembly. Year after year, union leaders who want even more taxpayer money revive this campaign.
Under this special-interest measure, police, fire and teacher contracts would remain in effect indefinitely after they have expired. The idea is to weaken the bargaining position of local cities and towns and pry more money out of the taxpayers, already burdened with some of America’s most crushing property taxes.
A fair accounting of this policy suggests that Rhode Island’s insiders understand that they’re really just managing the decline of the state. Theoretically, perpetual contracts could benefit either side, given the circumstances. We all understand that when the economic pressure would be on lower compensation for unionized employees, they’ll just sit on their contracts until things improve. When the economic pressure goes the other way, promoting higher pay, local governments could be the ones to sit on the contracts.
However, everybody from the unions to municipal and school district leaders to the Providence Journal understands two things:
- Economic flourishing isn’t in Rhode Island’s future unless the state can break insiders’ strangle hold on the state, and that doesn’t look likely, absent a terrible crash.
- Interacting with that point, the deals that unionized government employees get in Rhode Island are so generous that it’s even less plausible to imagine circumstances in which Rhode Island’s economic growth would be so strong that the government would struggle to find people willing to work for that amount of remuneration.
Add in the fact that union employees can disrupt government services much more readily than government agencies and school districts can get out from under their unions, and it’s clear why this is such a one-sided issue. At least the insecurity of a lapsing contract instills some discomfort among Rhode Island’s privileged class, which gives elected representatives a little leverage. Whether or not they take advantage of that leverage — which hinges, in large part, on whether they were elected with the unions’ help — is another question.
In the Newport Daily News, Sean Flynn highlights another example of the outrageous behavior among teachers union organizers, which ought to embarrass well-intentioned, professional teachers:
Superintendent of Schools Colleen Burns Jermain sent a notification to all parents on March 1 informing them that the conferences would take place between 1 p.m. and 6 p.m. on three days this week, one day at each school, the same as has been done in past years. …
The conflict reached a new flashpoint over the weekend with an advertisement in this newspaper paid for by attorney Jennifer Azevedo, who is an assistant executive director of the National Education Association RI, on behalf of the Teachers Association of Newport. The ad claimed the parent-teacher conferences would be held during the regular school times at each school on the designated days. Regular school hours are staggered between 7:45 a.m. and 3:30 p.m. among the three schools.
On first review, this has the feel of parents who are tearing their children apart as they head toward divorce, but that analogy isn’t applicable. The union advertised publicly in a way that presumed to set school policy. Here’s the ad; it’s extremely misleading, with no indication that it’s actually part of a disputed policy. This is the union saying, “Whatever your elected and appointed school administration might think, we run the schools.”
Hopefully, the Supreme Court will give teachers the ability to get out from under this thuggish organization when it decides its Janus case this year. Be that as it may, parents and voters should respond to this abuse of contracts to figuratively rip the contracts up.
And any legislator who votes for the legislation to make teacher contracts last forever unless renegotiated ought to find him or her self unelectable.
A $95 fine can cause undo hardship on Rhode Islanders. This is a money grab by Mayor Elorza and Democrats on Smith Hill.
Are you getting it YET, Rhode Island? #November2018@NewportLost @TrussElise @DonnaHoyle2 @DavidAHolley @pissedoffinri @MakeNEGrrAgain @gebr71 @wendy_hail pic.twitter.com/6LjlmgeFwZ
— RIRepublicans.us (@RIRepublicans) March 11, 2018
Elorza’s Former Chief of Staff is $5,000 a Month Lobbyist For Traffic Camera Company: https://t.co/bfVukqTW2n
— OSTPA (@OSTPA1) March 10, 2018
I’m sure this has nothing to do with the fact that the state has imposed a new tax on these properties, with a cut going to the relevant municipalities:
The city is looking to hire a contractor to monitor short-term house rentals in the city to see whether they are complying with zoning ordinances and other regulations, Mayor Scott Avedisian announced.
A check of available short-term house and apartment rentals on Airbnb and VRBO, two major short-term rental websites, showed each had about 200 listings in Warwick. Avedian said the city building department doesn’t have the resources to check each property and monitor them for compliance, but a contractor would. …
Avedisian said the city’s plan is based on a similar effort by the City of Newport, which hired a firm called Host Compliance LLC, to track short-term leasing within its borders. Newport Mayor Henry F. Winthrop said the company’s first effort produced a list of about 235 properties listed online for short-term leases that appeared to either be unregistered as businesses or in violation of a city regulation.
Such stories contribute to the impression that government in Rhode Island doesn’t see itself as serving the people, so much as the people serve the government. Give it financial incentive, and it will go after the citizens. We’re here as a bank for officials to collect money for their own favored parties, which mainly means labor unions, but also covers compliant corporations, dependent constituencies, and the occasional relative of somebody connected.
Let’s stipulate that public safety is paramount and that lives and bodily injury beat road repair on the priority list every time. That said, Newport Mayor Harry Winthrop could have picked any government activity to highlight in this exclamation, made in the context of a conversation about school shootings:
“Our number one priority is public safety,” Mayor Harry Winthrop said. “Who gives a damn about a pothole on Bellevue Avenue if we are not safe?”
He didn’t go with his government’s charitable grants, beautification projects, open space, community planning or any of the countless other things that municipal government does that ought to come after both public safety and maintenance of infrastructure. That tells us a lot about the priorities of our government officials, and we see it in our roads.
Which, by the way, don’t take long to become public safety matters themselves. When one drives around the state and sees bridges with regularly decreasing weight limits or propped up on wooden blocks and has to swerve onto the shoulder or into another lane to avoid potholes, the specter of harm and even death isn’t difficult to sense.
Crashing the speed camera system is simply accomplished by everyone demanding a trial.
— Rep. Blake Filippi (@Blake_Filippi) March 6, 2018
— OSTPA (@OSTPA1) March 3, 2018
This is the kind of stuff that pushes people past a breaking point. It also crashes governmental systems. It is neither healthy nor wise. https://t.co/Uzy2eliBCu
— Brian C. Newberry (@BrianCNewberry) March 2, 2018
Between the rampant crime and the fact that you run the chance of getting popped with a $95 ticket every time you visit the city, I suspect PVD will go back to its early 1980s "ghost town" status… self inflicted demise.
— Rep Mike Chippendale (@MikeWChip) March 2, 2018
If you’re wondering why legislators are now and then suddenly very concerned about catching people who speed, run red lights (just barely), or drive without insurance, Dan McGowan and Susan Campbell of WPRI give a hint as to the origin of their urgency:
Conduent earns $2,978 per month for each camera [in Providence] and $7.50 per [speeding] violation processed, meaning it was set up to make more than $100,000 during the first month of the program. The Maryland company, a subsidiary of a New Jersey-based corporation that was formerly a division of Xerox, also receives a $3.50 convenience fee every time a violator uses their credit card to pay a ticket.
Hey, keeping us all in line is always profitable for somebody. In this case, it’s also proving wildly profitable for the city:
A total of 12,193 tickets were generated from five speed cameras between Jan. 16 and Feb 22, with nearly all of the tickets coming from three locations: Mount Pleasant Avenue, Charles Street and Thurbers Avenue. (The cameras are not in use on Sundays.)
At $95 per ticket, that means violators were charged $1.15 million in just over one month. The city had already received $370,000 as of Feb. 22, records show. Six additional cameras will be deployed in various neighborhoods next week.
Of course, while that’s 12,193 reminders to slow down, it’s also 12,193 reasons to think twice before driving through Providence at all.
Sometimes inefficiencies create a natural balance. In its efficiency at charging people for driving violations, Providence may be preparing to teach us something about the costs of disturbing that balance when it comes to driving 11 miles per hour over the speed limit.
Portsmouth Concerned Citizens (PCC) alerts the public to a non-transparent adjustment that the town auditor made to make a deficit disappear without following the legal process.
Once again, the School Committee in Tiverton is trying to distract from its approximate $1 million annual surplus by seeking credit for spending the money on capital expenses. Unfortunately, it has done so in a way that has actually cost the town hundreds of thousands of dollars. Meanwhile:
The draft audit that the Town Treasurer has been preparing to release seems to indicate that no such account existed even by the end of last June. Yet, this year, Tiverton taxpayers will have to come up with $1,342,613 to pay principal and interest on debt the town had to accept in order to repair the high school and middle school. The school department could almost pay the entire debt payment with just its annual surplus — that is, it could take the debt payment off the back of the town with just the money that the School Committee decides not to spend each year.
Something’s not adding up.
The dynamics of rent control and public debate pit dry lessons by people with no incentive to promote them against heart rending stories from activists, leading to bad policies that hurt everybody but a lucky few… and the activists.
When the RI Senate Finance chairman complains to the municipality for which he’s a contracted lawyer that it wants more work than his contract allowed, it raises the question of whether he can work on a budget that gives his client millions of dollars.