super special assessments
2298 words, a 9 minute and 30 sec read
When I was about 10, I tried to ride my bike into the dug-up road in front of my house. It was about 4 feet down. I still have the scar from the 3 stitches on my forehead, and another from a piece of gravel that was embedded in my left eyelid.
Special assessments still sort of feel like that.
I was trying to hold off on this post until there was a little bit more info from the City on the current proposal to replace street assessments…but folks keep sending emails and comments (thank you), so I figured it’s time to dive in. With all these posts, I am being VERY cautious to not give only my opinion on the subjects, but rather to present good info, back up with other articles and data as needed, and tell you (I hope) compelling reasons why I think an idea is good or bad. It’s a ‘just the facts’ sort of thing. In this one, there are still a couple of speculative points…when they arise, I will point them out as unknowns.
A short bit of historical context: in 2018/19 there was a proposal put forth that would have eliminated part of special assessments. It was VEHEMENTLY (not too strong a word in this case) opposed by your Oshkosh Chamber of Commerce. In my opinion, for good reason. It was not a great plan. SO, the council at the time formed an ad hoc committee (chaired by your current Mayor) to investigate other options. I cared so much about this subject then that I was added to that committee, proudly served, and am still pleased that the group offered a creative and (in my opinion) still viable solution today. Our suggestion was nearly immediately dismissed by that council, but they vowed to keep working on it and investigate some other options. I will re-present that option to you a little later in this article, as I really do still believe it’s a pretty good option…so more on that in a sec!
Nearly 5 years later, we’re still investigating….but perhaps getting closer.
what makes road assessments so difficult is…
‘Equitable’ solutions are hard to come by as the landscape is impossible to quantify and provides little basis for ‘equity’. The proposal that failed first (the TUF as it was known) related fees to impervious surfaces of buildings…which doesn’t much relate to driving a car. Another option that the committee above evaluated (and one that has been proposed and failed in dozens of cities for decades) involves a business NAICS code (relating to what type of business it is and ‘historical’ traffic patterns they generate with relation to the size of the building etc). THAT would mean that small busy places pay the most, and large unpopular places pay the least. Also, not equitable (and…cities WANT is popular places. AND…who is to say if you first drive your car to Culver’s and then to the specialty eye clinic, which caused more damage to the road?).
BUT…we’re getting closer…
at current:
As a refresher, special assessments in Oshkosh now (and for the last very long while) are billed to property owners when the streets adjacent to their home or commercial property are replaced/repaired. This includes roads, curbs, gutters, aprons, sidewalks, and underground utilities. This is not a great way to do things. As costs have increased for road replacements and all, the assessments passed along to you and your neighbors have gotten very expensive. Often 5 figure bills are presented to first-time homebuyers and endless properties for decades have been saddled with bills that are paid over a long period of time. This impacts property values of where you live. This is also a VERY expensive system for a city to admin that involves big costs annually in billing, debt service, inspections and more. The best cities have moved on from this model, and it is time we do the same, as better options DO exist.
2. what is being proposed:
As a disclaimer: pretty much any option is better than what we do now. For the sake of this article, I’ll lay out the basics of the plan that your current council is proposing and give you some of my thoughts on it. This has not been fully explained publicly to my knowledge, there are still a few questions on it, and to a number, every single person I have spoken to about it knew almost nothing about it. SO…it’s worth talking about!
Current proposal would collect $2.25M from ‘utilities’ and $1.5M in a wheel tax (if you’ve been following along, VRF as is being discussed is ‘Vehicle Registration Fee’…which is a way to say ‘tax’ without using the word). As has been explained, this would equal ‘about $3/month’ added to every household and business (and institution) utility bill, and $35 added to each vehicle annual registration. (The biggest unknown with this…and perhaps someone reading can clarify, is the utility dollar amount. Roughly $3/month is fine to a degree, but we do need to know if that is a flat line item, or a percentage increase. We have some of the highest utility rates in the state already, and this is the portion of the subject that gets away from equity in an already inequitable playing field, if high water usage equals big fee increases when water has nothing to do with cars…unless we’re discussing a car wash I suppose ;) ).
THAT…is better than what we have now, and I am certainly glad we are discussing anything.
Here is what I don’t love about it:
It does not end special assessments. (Feel free to read that again). If you read and listened very closely to everything that has been said about this proposal, you would already know that. Everyone I spoke to (except for one Councilor who is awesome and is doing his best to spread the word on this also (thank you for the transparency Mr. Ford)) did not realize that this proposal only removes some of the cost of assessments. There would still be assessments for all utilities, these would still be large dollar amounts, city staff would still have to send lots of letters and bills, and your city would still need to carry the debt of deferments for 10-15 years. Lots of what excites me most about ending assessments (all of those cost savings just mentioned) are barely saved in this option. This proposal funds approximately half.
Wheel tax is regressive. This one easy to agree on. Nobody likes new taxes…we all get that. Wheel tax traditionally understood as one of the most regressive forms because it really does impact folks with the least amount of money the most. The way I like to explain it is this: The folks who will suffer most from a wheel tax are those that NEED a second car because they NEED a second job (and often NEED a third car for a third job held by a younger household member as well). That said, wheel tax not at all uncommon, and Oshkosh probably in the minority by not having one. For comparison, and of note, however; ours at the proposed $35/car/year would be second highest in the state behind Milwaukee, and %75 more than Appleton at $20.
No Waiver for those recently assessed. If you haven’t heard it yet, the most vocal argument against any change in the way the city handles assessments will be, and rightly so, from those who just got a big assessment. Most cities who implement a new policy on this subject include some sort of waiver to new fees (hi Neenah). That’s a little hard with a wheel tax as it’s initially paid to the state. But there should be something, as I understand it’s no fun to have been the last folks to pay an assessment. HOWEVER…it’s also important to remember that not bankrupting your neighbors is good for the local economy, and that saving $$$ in City Hall ultimately means you get better services in other areas (and h*ck, maybe even more nice roads if we do all of this right!). Here’s my favorite analogy on this: Remember that time you bought a fancy new 65” TV and then you saw it on sale 6 months later? That sucks, but you don’t insist that everyone else who wants to buy that TV must pay the same amount you did.
3. can’t we just…
Add road repairs to the general tax levy and let everyone pay for them? Yes…and lots of cities do. Can we afford it? The $3.75M being sought by wheel tax and utility fee, I think yes…honestly. Oshkosh this year received its first new payment in revenue sharing from the State of WI and will continue to receive these $2M annually. This year, all of it was spent on emergency service needs (which is important). In future years, with a creative and proactive eye on the savings earned from not incurring as much debt, and less billing of these sorts of assessments, I do believe it is possible to fund a portion of road repairs with general levy. I do not think we should do any of this 1/2 way as is being proposed. AND I believe there are better options we can take (as there are lots more uses for that revenue sharing that might make your life better as well).
I was taught to not complain about something unless you had another (doesn’t even need to be better) idea…
4. here’s one better idea and the best idea you’ve heard this month…
Better:
What was proposed by the committee I served on in 2019 was a flat rate per parcel, added to utility bills. One amount for ALL residential parcels and one for all non-residential parcels.
$8/month for residential. $50/month for non-residential. That generated (at the time) enough revenue to replace all special assessments. Not half. Truly an end to special assessments.
Is that the most fair and equitable solution? Nope. Does it have much to do with vehicles that damage roads? Not really. As mentioned above, this subject is a REALLY tough one for ‘equitability’.
What the committee DID note was that we could not find nor create a scenario where paying this flat monthly rate was not substantially less expensive than a special assessment…for residences or businesses.
According to a recent article, residential assessments tend to be $10-$18k. Let’s just take the lowest number and say $10,000. If you paid $96/year toward all assessments, it would take 104 years before this proposal was worse for you than the current option (and roads do not, sadly last that long).
5. here’s the best way to do it…
Did you know that your county, Winnebago Co. is one of 3 in the state without a %.5 additional county tax (Racine, Manitowoc and you). This puts you, and all of us, at a literal competitive disadvantage to surrounding cities every second of every day (and I promise you I am not overstating that). Cities are competitive. We need people to move here, and stay here, and resources have never been slimmer than now.
The ad hoc committee mentioned above explored this option briefly, and it is believed that an additional .5% sales tax (which again, brings yours up to the same as just about literally everyone else’s) would generate just about $31M.year. (Fun side note…EAA week alone would generate $1M in new revenue. And guess where those folks live??? (not here)…but guess whose roads they drive on when they visit??? (YOURS!!!).
If we implement that sales tax and allocated ALL of the funding needed to repair ALL of the roads in the county AND fund the operations of the airport (just for good measure and because YOU COULD) that would add up to about $9M/year. The rest of the funds allocated to the cities and towns in Winnebago Co. would more than fund the replacement of all special assessments for good. And likely forever.
Does sales tax equate exactly to driving a car? No…but is it a LOT closer than water runoff…you bet)! This also has ALL of the extra added benefits of cost savings for administrative fees (not just for Osh, but every city and town in Winnebago Co.) AND improves the landscape of your County budget by taking a couple items off of their ledger as well. (And also… Hi Town of Algoma!!! Sometimes we know that you come into our lovely city to shop…and we appreciate that!. When you’re here, you are also using city roads…hint hint.)
This is not, however, something the City of Oshkosh can do…it falls to the County board of Supervisors to act. Do you know who your county representative is? (it’s OK if you don’t…there are a heap ton of them).
What I think the city of Oshkosh CAN do in this instance is apply pressure to our county to act on our behalf (they sort of don’t exist without us anyway right?). AND you can email your supervisor and ask them about this…as after all, YOU elect them (here’s a list…and feel free to subject line ‘HOLY H*CK WHY DOES EVERYONE ELSE ALREADY HAVE THIS BENEFIT ;) ) .
if you’ve read all of this…
you are awesome, and I really appreciate it! I hope this was helpful in learning about special assessments in general and in learning more about what is being proposed and will affect you very very soon. Obviously, I believe the county tax option here the best one…and will take the most work.
No taxes are good ones. I do hope after reading that you see, same as I do, that the benefits of improving the way we assess outweigh some shared expenses.
And of the options presented, there is one important question that should be considered:
Which regressive tax is worse? Wheel tax, or %.5 sales tax?
as always, any comments/questions/feedback click the button and many times thanks!