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With our array of taxing districts poised to set tax rates later this summer, it seems only fitting that a 1960s movie titled “The Flim-Flam Man” included scenes shot right here in Lawrenceburg
That movie featured a pair of drifters who teamed up to gain the confidence of locals while bilking them out of their money. The key, of course, was to never let the local rubes know that they were having their pockets picked, which isn’t all that different than the way the system to raise property taxes works.
Granted, this ruse wasn’t invented locally — it’s a state thing — and the elected and appointed people who perpetrate the ruse really have no other options. Well, the library folks do, but that’s another story.
Nevertheless, here’s how the scam, which is wholly dependent on its victims being gullible and paying almost no attention, works.
The victims — OK, taxpayers — are first bedazzled with a story filled with highfalutin numbers, formulae and words, all designed to gain their confidence before lulling them into a false sense of security.
The story is always the same, and goes something like this: “We’ve done all we can, Mr. and Mrs. Taxpayer, to be frugal with your money during the past year, but darn it all to heck, we just don’t have enough money to continue providing all of these tremendous services, blah, blah, blah.
They will then carp and whine about increases in employees’ retirement costs and medical insurance, and make it very, very clear that those issues are out of their control. (They never consider actually doing anything about those issues except complain, which is telling, don’t you think?)
The stage set and the props in place, the con moves smoothly into the second act, which includes sheets of paper filled with six- and seven-digit numbers multiplied by smaller numbers that go four or five decimal places to the right. The expected outcome is to first glaze the eyes of those who vote on a tax rate (at least half of them have no clue what they’re doing), and put the audience to sleep.
Buried in the data like a tick on a long-haired dog is several bottom lines, which tell the taxing district how much more money it will receive and what tax rate will be required to get it.
They’ll get to choose from a variety of choices, including the notorious “compensating rate,” a bald-faced lie of a formula that supposedly provides the same revenue to the district as it received the previous year.
It’s a lie, frankly, because they know going in that new construction that has already been added to the assessed value of the county or city is excluded, but compensating sure sounds nice, right? Who doesn’t want to be compensated?
The dirty little secret they rarely discuss — and hate that I point out — is what that decision does to your tax bill.
Here’s an example: Last year, the fiscal court voted for a compensating rate (which generated $63,000 in additional revenue, proving what a lie that term really is), congratulated itself and moved on.
But what it actually did was raise the rate you pay by 3.25 percent. That means instead of paying $1.23 for every $1,000 of your home or business’ assessed property value, your rate jumped to $1.27. No, that’s not much, but it adds up fast when the other taxing districts do the same thing.
Then there’s the city council, which went whole hog and raised its revenue by 4 percent, the maximum allowed without subjecting itself to a public vote. That raised the tax rate for city dwellers a nifty 6.6 percent, which also was never mentioned. Anyone out not on the city council who received a 6.6 percent raise last year raise your hand.
Didn’t think so.
In fairness, there are a few elected people on these boards who genuinely do give a rip about your taxes, and certainly aren’t running any cons.
If nothing else, though, I hope this at least gives the rest of them something to consider, and serve as a reminder that the rest of us pay for their decisions.