Posted in the Prior Lake American: Tuesday, November 24, 2015 6:00 am
By John Diers
“Boosterism” has been a part of the American experience since the opening of the West. In the 19th century, it was about settlement and filling the frontier with farms and towns and turning towns into cities and linking them with railroads.
It was about individuals and business leaders and fraternal groups coming together to promote a town’s growth and development – and it worked, but it also had unintended consequences when reality caught up with the aspirations of promoters, speculators and city fathers. The Panic of 1857 ruined communities when property values collapsed and tax revenues couldn’t cover debts acquired in anticipation of future prosperity. This was followed by panics in 1873 and 1893 with similar results. The worst, other than the recent 2008 bust, was the collapse of the Florida Boom in 1926, followed by the Great Depression in 1929.
Boosterism has yet to triumph over the vagaries of the business cycle, nor can we ignore the inevitably of the business cycle when making future plans. Prior Lake is a great community, but to secure its future, city government has to manage its resources and spending based on current needs, not on long-range plans and the prospect of future growth and development.
The proposed 11.5-percent tax increase is all about boosterism. Follow this logic. Prior Lake is a good place to live, but it needs to spend more money so it can be even better, compete with other communities for still more growth and development, which in turn creates a demand for still more services, and higher taxes.
It’s a non sequitur and a treadmill to nowhere.
Advocates and city management claim it will cost no more than a few cups of coffee a month. Maybe so for those with good incomes and plenty of opportunity, but what about people who are retired and living on pensions and Social Security? Their homes may be paid for, but if this tax increase is a harbinger of future increases, and is added to and compounded by yet another and another, it will be difficult for them to pay their tax bill and keep their homes. One thing is certain. The population is aging. The baby boom generation that needed new schools and jobs and sustained the economy in the ’50s and ’60s is moving into retirement and will face all the issues and costs that come with advancing years.
Be assured more tax increases will follow, especially as the school district moves forward with a referendum next May to build another elementary school, and the county looks ahead to its future needs. Look back at the past five years. City spending has gone up 64 percent since 2010 against a cumulative inflation rate of 7.85 percent. Other service have gone up, too, water and sewer in particular. The rate for sewer and water in 2010 was $4.15 per thousand gallons. It’s now $6.17 – all of this in just five years. It’s altogether possible residents could be paying more for sewer and water than they do in property taxes – especially if the city builds additional treatment plants to accommodate the proposed growth and development in its 2040 vision.
All of this means more city debt, and that debt is driven not by current needs, but by a passion for growth and economic development that will leave residents with still more double-digit tax increases, while enriching developers and speculators.
The city’s 2016 budget and capital improvement plan calls for increasing city debt from $36 million to a whopping $65 million by year-end 2019, an 80-percent increase. That debt will have to be paid down in future years. How? By raising your property taxes.
Let’s look at a couple projects in the capital improvement plan. There’s the proposal to extend Stemmer Ridge Road to County Road 82 – a cost of $5 million. Who benefits? Not the residents on Stemmer Ridge. They’ve opposed it from the beginning. Instead, it will open up additional land outside the city for future development. Property owners, developers and land speculators stand to make big bucks, while taxpayers pick up the tab.
Then there’s the infamous Arcadia extension that won’t go away, for $9.9 million to close Main Avenue at County Road 21 and extend Arcadia through to Highway 13 – opposed by downtown businesses and neighborhood residents. Same story: developers and landowners make money. Taxpayers, downtown businesses and a neighborhood lose.
Does Rolling Oaks Circle sound familiar? Last year, the city proposed rebuilding Rolling Oaks Circle to benefit a developer and make homeowners pay for it. Guess what? It’s back in the capital improvement plan.
The city hasn’t been forthcoming on much of this, preferring in its most recent public meeting to explain how the budget was built, not what’s in it. For another look, Citizens for Accountable Government is hosting a community budget meeting to review the 2016 budget in the conference room at Fire Station No. 1 at 7:15 p.m. on Tuesday, Dec. 1.
The council ill advisedly approved the capital improvement plan on a 3-2 vote. It should rethink that decision by freezing property taxes and the 2016 budget and directing staff to develop a zero-based budget plan based on current needs, not 2040 boosterism.
John Diers is a Prior Lake resident who spent 40 years working in the transit industry and author of “Twin Cities by Trolley: The Streetcar Era in Minneapolis and St. Paul” and “St. Paul Union Depot.” To submit questions or topics for community columnists, email firstname.lastname@example.org. (Editor’s note: Diers is a community columnist and not employed by, or paid by, the newspaper.)
Please read more from the Prior Lake American: http://www.swnewsmedia.com/prior_lake_american/news/opinion/columnists/commentary-no-room-for-boosterism-at-city-hall/article_e6022488-b6ae-5b45-a792-ba8a6c900d9e.html