Fiscal Secession: An Analysis of Special Assessment Financing in California

2018 ◽  
Vol 56 (2) ◽  
pp. 480-512
Author(s):  
Mathew D. McCubbins ◽  
Ellen C. Seljan
Keyword(s):  
Ethnic Diversity ◽  
Local Governments ◽  
Property Tax ◽  
Property Taxes ◽  
Single Family ◽  
Progressive Taxation ◽  
Geographic Ranges ◽  
Alternative Method ◽  
Local Services ◽  
Special Assessment

Special assessments on property are a fiscal innovation employed by many local governments. Unable to raise property taxes due to limitations, localities have turned to these charges as an alternative method to fund local services. In this article, we seek to explain differential levels of special assessment financing through the analysis of property tax records of a sample of single-family homes in California. We theorize that special assessments, as opposed to other forms of taxation, will be used when residents hold anti-redistributive preferences. We show that annual assessment payments are correlated with the ethnic diversity and median family incomes of the census places within which they are located. We also show that assessments with narrow geographic ranges are levied extensively on expensive homes in poorer cities. We discuss the implications of special assessments for progressive taxation and the potential for fiscal secession within U.S. cities.

scholarly journals Policy Forum: Implementing the Chippewas of Georgina Island First Nation Property Tax System—Opportunities, Challenges, and Lessons Learned

2021 ◽  
Vol 69 (3) ◽  
pp. 857-872
Author(s):  
Kate McCue ◽  
Bill McCue
Keyword(s):  
First Nations ◽  
Property Tax ◽  
Lessons Learned ◽  
First Nation ◽  
Property Taxes ◽  
Tax System ◽  
Fiscal Management ◽  
Local Services ◽  
Policy Forum ◽  
Do So

In 2018, the Chippewas of Georgina Island First Nation (GIFN) implemented a First Nation property tax system under the First Nations Fiscal Management Act (FMA)—one of the earliest First Nations in Ontario to do so. Implementation of a property tax system gave GIFN an opportunity to improve funding for and expand local services, and provide a more equitable sharing of local service costs between cottagers leasing First Nation land and the First Nation. Key challenges encountered when implementing the property tax system were building consensus around the need for a tax system, building an appropriate administrative infrastructure, carrying out property assessments, and professionals lacking knowledge of First Nation property tax. These challenges, however, presented opportunities to create a knowledge base around property taxation within GIFN, among cottage leaseholders, and in the wider community. Key lessons learned were (1) start as soon as possible; (2) First Nations Tax Commission support and standards are important; (3) staff training is important; (4) communicate early and often; (5) hold open houses; (6) local services are more than garbage collection; (7) property taxes do not harm lease rates or cottage sales; (8) educate lawyers, real estate agents, and other professionals; (9) startup costs were significant; (10) coordinate laws and standards with provincial variations; (11) modernize systems; and (12) utilize other parts of the FMA.

scholarly journals LEGAL AND THEORETICAL ASPECTS OF PROPERTY TAXES

2016 ◽  
Vol 2627 (34) ◽  
pp. 195-222
Author(s):  
Agnieszka Żywicka ◽  
Tomasz Wołowiec
Keyword(s):  
Property Tax ◽  
Market Value ◽  
Property Taxes ◽  
Ad Valorem Tax ◽  
Property A ◽  
Real Property ◽  
Personal Property ◽  
The Government ◽  
Special Assessment ◽  
Fair Market Value

A property tax (or millage tax) is a levy on property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state, a county or geographical region, or a municipality. Multiple jurisdictions may tax the same property. This is in contrast to a rent and mortgage tax, which is based on a percentage of the rent or mortgage value. There are four broad types of property: land, improvements to land (immovable man-made objects, such as buildings), personal property (movable man-made objects), and intangible prop-erty. Real property (also called real estate or realty) means the combination of land and improvements. Under a property tax system, the government requires and/or performs an appraisal of the monetary value of each property, and tax is assessed in proportion to that value. Forms of property tax used vary among countries and jurisdictions. Real property is often taxed based on its classification. Classification is the grouping of properties based on similar use. Properties in different classes are taxed at different rates. Examples of different classes of property are residen-tial, commercial, industrial and vacant real property. A special assessment tax is sometimes confused with property tax. These are two distinct forms of taxation: one (ad valorem tax) relies upon the fair market value of the property being taxed for justification, and the other (special assessment) relies upon a special enhance-ment called a “benefit” for its justification

Raising local revenue: The use and adequacy of voluntary property taxes in arkansas

2017 ◽  
Vol 29 (4) ◽  
pp. 498-521
Author(s):  
Kim U. Hoffman ◽  
Joseph Yuichi Howard
Keyword(s):  
Local Governments ◽  
Public Services ◽  
Property Tax ◽  
The State ◽  
Property Taxes ◽  
Revenue Source ◽  
Local Revenue ◽  
Expenditure Data ◽  
State And Local

AbstractWith the late-2000s recession, state and local governments have struggled to find the necessary revenue to sustain citizens' demands of governmental services. One potential revenue source is to allow the citizens' themselves to choose the services to fund through the usage of voluntary taxes. Counties and cities in Arkansas have the authority to levy a voluntary property tax to support specific public services. In this study, we explore the prevalence and adequacy of the voluntary property tax by local governments in Arkansas. We identify 58 different voluntary taxes used in 27 counties and 17 cities throughout the state. Moreover, using revenue and expenditure data, we find the tax to be a significant revenue source for several county programs.

Limits of Property Taxes and Charges: City Revenue Structures After the Great Recession

2017 ◽  
Vol 55 (1) ◽  
pp. 185-209 ◽  
Author(s):  
Yunji Kim
Keyword(s):  
Public Finance ◽  
Great Recession ◽  
Local Governments ◽  
Property Tax ◽  
Property Taxes ◽  
Historical Trends ◽  
Stable Property ◽  
The Great Recession ◽  
Expenditure Limitations ◽  
Urban Places

Public finance theories argue local governments should primarily use broad-based and stable property taxes. However, the housing bust after the Great Recession challenges this argument, and historical trends show cities have heavily relied on charges since the late 1970s. Using 2012 Census of Governments data for 2,396 cities, this article explores which cities rely more on charges and the links between property tax dependence and city stress. Regression results show property tax dependence is linked to capacity, while charges dependence is linked to stress. Charges can be a useful revenue tool for cities under stress, but they may be regressive and their use may be limited to urban places with services that can be charged for and cities with growth pressures and less stringent tax and expenditure limitations. Absent equalization efforts from higher-level governments, barriers to using charges, which cities have little control over, may increase inequality among cities.

scholarly journals The role of property taxes in the financing of local government: Case of Turkey

2016 ◽  
Author(s):  
Semra Altingoz
Keyword(s):  
Local Government ◽  
Local Governments ◽  
Property Tax ◽  
Financial Structure ◽  
The Other ◽  
Property Taxes ◽  
High Quality ◽  
Income Sources ◽  
Distribution Of Income

Central governments canalize to decentralized organization for compensate public demands faster, high quality and efficiency in globalization process. Local governments take effectively charge in distribution of income, education, health, housing on local basis which are parts of public policy and increasing the welfare level of the citizens of their municipality with their own facilities. The most important mission is incumbent to municipalities which is local governments’ type, in decentralized organization. Municipalities have two types incoming source; one of them from central governments sources the other one is internal revenue. This study aims to give information about municipalities which are at the forefront among local governments and property tax which is one of income sources municipalities. In this sense, law no. 5393 which was accepted on the 3rd of July, 2007 was studied in the frame of property tax and information about the phases of municipalities from the foundation up to now and their financial structure was given.Keywords: property tax, local government, decentralization, budget. 

The Effects of Fiscal Competition on Local Property and Income Tax Reliance

2005 ◽  
Vol 5 (1) ◽  
Author(s):  
John Arthur Spry
Keyword(s):  
School Districts ◽  
Local Governments ◽  
Income Tax ◽  
Property Tax ◽  
Local Property ◽  
Property Taxes ◽  
Recent Experience ◽  
Fiscal Competition ◽  
Using Data ◽  
Ohio School Districts

AbstractThis paper examines why local governments rely heavily on the property tax, even when they have access to another revenue source, using data from Ohio’s recent experience of permitting local school districts to use both property taxes and residence-based income taxes. Nechyba’s (1997) theory that local governments’ reliance on the property tax instead of the income tax is due to fiscal competition for relatively high-income residents is tested using data from 610 Ohio school districts. The Ohio residence-based school district income tax is used by only 119 school districts, at low tax rates, to supplement the traditional property tax. The use of a local income tax declines sharply as fiscal competition increases, as measured by the number of nearby school districts. School districts with greater opportunities to export the burden of the property tax to non-residential property owners are less likely to adopt a local income tax.

Fiscal role of personal property tax

2020 ◽  
pp. 143-149
Author(s):  
Р.Ш. Абакарова
Keyword(s):  
Russian Federation ◽  
Local Governments ◽  
Property Tax ◽  
Property Taxes ◽  
Current Role ◽  
Personal Property ◽  
Factors Influencing ◽  
The Russian Federation ◽  
The Impact

Цель работы – выявить текущую роль имущественных налогов в формировании бюджетных доходов территорий Российской Федерации. Основные элементы рассматриваемых налогов изучены с применением метода наблюдения и сбора фактов. Рассматриваются факторы, влияющие на фискальную значимость изучаемого налога, анализируется динамика его элементов. Рассматриваются перспективы изменения исчисления и взимания налога, а также возможные варианты влияния элементов налога и других факторов на его фискальную значимость. Делается вывод о низкой фискальной роли налога и практическом отсутствии возможностей влияния на фискальную значимость органов местного самоуправления в рамках полномочий, определенных Налоговым кодексом РФ при установлении и введении в действие данного налога на территории муниципального образования. The purpose of the work is to identify the current role of property taxes in the formation of budget revenues territories of the Russian Federation. The main elements of the taxes under consideration were studied using the method of observation and collecting facts.The factors influencing the fiscal significance of the tax under study are considered, and the dynamics of its elements is analyzed. The prospects for changes in the calculation and collection of tax, as well as possible options for the impact of tax elements and other factors on its fiscal significance are considered. The conclusion is made about the low fiscal role of the tax and the practical lack of opportunities to influence the fiscal significance of local governments within the powers defined by the Tax code of the Russian Federation when establishing and implementing this tax on the territory of a municipality.

Political Shirking – Proposition 13 vs. Proposition 8

2009 ◽  
Vol 10 (2) ◽  
pp. 213-237
Author(s):  
SEIJI FUJII
Keyword(s):  
Local Governments ◽  
Property Tax ◽  
State Legislature ◽  
Property Taxes ◽  
The Political ◽  
Proposition 13 ◽  
Proposition 8 ◽  
Political Market ◽  
Tax Limitation ◽  
Voter Initiative

AbstractThis paper considers the efficiency of the political market in the California State legislature. I analyzed the property tax limitation voter initiative, Proposition 13. I found that districts which supported Proposition 13 more strongly were more likely to oppose the incumbents regardless of whether the incumbents had the different preferences for property taxes from their districts. I also studied how legislators voted on the bills adopted after the passage of Proposition 13 to finance local governments. I found that legislators tended to follow the constituents’ will after they received the voters’ tax-cutting message expressed by the passage of Proposition 13.

Features of property taxes and their role in the formation of local budget revenues

2019 ◽  
pp. 66-70
Author(s):  
Vasyl Prots
Keyword(s):  
Real Estate ◽  
Local Governments ◽  
Early Stage ◽  
Current System ◽  
Property Tax ◽  
Property Taxes ◽  
Local Taxes ◽  
Property Taxation ◽  
Real Estate Tax ◽  
Property Inheritance

The extension of powers and functions of local self-government bodies in the context of financial decentralization should be accompanied by an appropriate increase of local taxes and fees to local budgets. Currently, property tax is a new element of the local taxation system and a financial tool for local governments. Since the property tax system is at an early stage in its development, there are a number of debatable issues, in particular, it is really necessary to assess the current system of property taxation in Ukraine, to investigate the fiscal role of property taxes and to outline directions for its improvement. The paper argues that in contrast to Ukraine, property taxes in many countries include the taxes on certain types of property, on net assets, on transfer of property ownership. The author proves that the taxation of property is based on the following principles: equivalence; solvency and equity; fiscal efficiency and financial capacity; security; performance. The analysis shows that since 2015, due to increased tax revenues, local taxes and fees have become the second largest source of local budgets. In 2015-2017 the largest share in the structure of property tax was paid for land 90-93%, the tax on real estate, other than land plot 4,6-8,3%, transport tax 0,8-2,7%. However, the greatest increase of revenues to local budgets accounted for the tax on real estate. The main factors of the growth of property tax since 2015 are due to the inclusion of land and transport taxes to property tax and the introduction of new ratios of indexation of normative monetary estimates for calculating land payments. The shortcomings of the system of property taxation are identified, namely: the level of urbanization of the territory where the object of taxation is located is not taken into account; the existing approach to taxing the area of immovable property, different from the land, does not take into account the degree of its physical depreciation; non-compliance with the principle of social equality and the imperfect mechanism of taxation of non-residential real estate of economic entities and individuals. The paper suggests to include irregular taxes into property taxes, that is, taxes on transfer of property: inheritance tax; gift tax. To determine the amount of real estate tax and land tax, the rates should be set as a percentage of the market value of the tax object, in order to simplify the process of taxes administering.

scholarly journals International Real Estate Review

2008 ◽  
Vol 11 (1) ◽  
pp. 83-95
Author(s):  
Andrew Narwold ◽  
◽  
Jonathan Sandy ◽  
Charles Tu ◽  
◽  
...  
Keyword(s):  
Property Tax ◽  
Property Taxes ◽  
Hedonic Regression ◽  
Single Family ◽  
Housing Value ◽  
Local Municipalities ◽  
Percent Increase ◽  
Tax Savings ◽  
The Impact ◽  
The City

The State of California enacted the Mills Act in 1972. This act allows local municipalities the option of setting up a historic designation program. The main feature of the program is to allow the owners of historic buildings a reduction in their property taxes in return for an agreement to not alter the exterior façade of the designated building. This paper uses hedonic regression analysis to estimate the impact of the historic designation on the value of single-family residences in the City of San Diego. The results suggest that the designation creates a 16 percent increase in housing value. This is higher than the capitalization of the property tax savings would suggest, implying market value in the historic designation itself. The Mills Act represents an innovative approach to historic structure management and may provide guidance to governments elsewhere in the U.S. as well as internationally when designing historic preservation programs.

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