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Property Tax Mess Presents No Easy Fix

Hartford Business Journal

May 09, 2011

Running a major American city is no picnic.

It was a little more than 40 years ago when John Lindsay declared being mayor of New York City ďthe second toughest job in America.Ē His administration had been marked by a teacher strike, a transit strike, a garbage strike, street violence and a snowstorm that wouldnít quit. Things were so bad police deployed snipers to protect him during a public ceremony. Yet Lindsey, who couldnít win his party primary, won election to a second term. Voters realized the problems werenít of his making and he was trying to fix the problems without sugar-coating the challenges.

By comparison, Hartfordís Pedro Segarra has had it easy. Heís taken over a decaying city battling an exodus of jobs and residents, awful schools, eroding state aid, a commercial property vacancy rate around 30 percent and a budget outlook thatís bleak at best. And he got the job when his predecessor resigned amid a corruption scandal.

Among the unsolvable problem he has inherited is a tax system thatís been broken for decades. As Greg Bordonaro reports on our front page this week, the fight over business vs. residential property taxes is turning ugly. And Segarra finds himself squarely in the middle as he readies for an election battle.

He knows he has to cut the tax bite on Hartford business owners who are paying twice what neighboring communities charge. Heís willing to let an outdated business property surcharge expire. And he knows this yearís state-mandated reassessment will reflect the declining values of Hartford commercial property, further reducing tax bills. All thatís a start, but thatís all it is.

The underlying fairness problem is that Hartfordís residential property is assessed at just 30 percent of value ó not the 70 percent mandated by the state ó robbing billions of assessed value from the cityís tax rolls and placing business owners at a horrible disadvantage.

Fixing a problem of that magnitude falls in the John Lindsay realm.

In total, Hartford residents are already among the nationís poorest. They canít pay their fair share anytime soon. And asking them to try will likely set off a ballot box backlash that would sweep Segarra from office.

Yet Hartford business owners are tired of carrying that extra burden. It has sapped the competitive advantage that should flow from an address in the Capital City. Businesses ó and jobs ó long ago started heading for the exits. Now even the hard-core believers in what Hartford could be are questioning their own decisions to stay.

Getting to a barebones municipal budget is a good step, too. And Segarra is already on that angle.

What needs to be done seems clear. How to get it done isnít.

Itís not a mess of Segarraís making and he has had a matter of months to fashion a fix. Thatís not fair but then nobody said being a big-city mayor would be fair.

A nice try

Republicans in the legislature havenít done much to distinguish themselves this term. So itís refreshing to be able to applaud a GOP legislator who did what minority parties are supposed to do ó he tried to make a difference.

In the wee hours of May 3, Sen. L. Scott Frantz of Greenwich stood and offered a budget amendment that would have put a two-year time limit on all of the new taxes in Gov. Malloyís budget. The taxes are a response to a crisis; itís a debt we need to pay. But the taxes are not a pot to fuel future excesses. Let the legislature re-evaluate them in the context of 2013.

Predictably, his good and rational answer went down on a party line vote. Still, it was a worthy effort.

Reprinted with permission of the Hartford Business Journal. To view other stories on this topic, search the Hartford Business Journal Archives at http://www.hartfordbusiness.com/archives.php.
| Last update: September 25, 2012 |
     
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