Tax Considerations on Township Consolidation

Commenter Susan has done the math on a couple of the townships which consolidation proponents suggest should be merged.

One proposed consolidation or townships.

One proposed consolidation or townships.

Her analysis is below:

Am I missing something, or is the voter’s decision made by simply looking at the comparative tax rates of townships at issue?

It seems to me that the lower tax rate township citizens will immediately begin subsidizing the higher tax rate township.

If savings accrue through consolidation, the lower tax rate township will have to see the combined township tax rate lower than their current tax rate in order to benefit.

Using the data from the table above, I ran comparisons of 4 proposed township marriages.

( even if data from table is incomplete or inaccurate, the procedure of comparison is easy: divide revenues ( extension) by eav.

Doing that separately for each township then using totals ( total revenues divided by total eav):

1. Algonquin/Grafton.

Algonquin rate: .002408172
Grafton rate: .001953461
Combined rate ( total revenues /total Eav) : .002242668

( Algonquin taxpayer win, Grafton taxpayers lose)
( savings from consolidation would need to get total rate down to, or below Grafton’s original tax rate of .001953461)

2. McHenry/Nunda

McHenry rate: .00557327
Nunda rate: .004699327
Total rate: .005130769

3. Dorr/Greenwood

Dorr rate: .003796336
Greenwood rate: .006401209
Total rate: .004643521

4. Chemung/Dunham

Chemung rate: .007246997
Dunham rate: .009981699
Total rate: .008281001

So in every case of consolidation, there is one township jumping in tax rate while the other township drops in tax rate.

Why would any of the lower tax rate township voters want to vote for this?

= = = = =
I believe that a good part of Dunham’s rate is for the $1 million road improvement bond passed recently. My understanding is that such debt would not be shared by another township’s property owners.


Comments

Tax Considerations on Township Consolidation — 7 Comments

  1. Questions that really need to be answered by Schofield / Shorten:

    If a consolidation is approved, who sets the salaries for the consolidated offices?

    If the salaries are set based on the current salaries for one of the Townships being consolidated, what is to stop the Board from doubling those salaries prior to the next election?

    Because operating out of two buildings would be inefficient how much money is included in the consolidation study to pay for a new centralized building?

  2. Centralizing the building would add to travel time to do the work.

    Even McDot wants a second building somewhere in the SE part of the county.

  3. Why would anyone expect the salaries to be less?

    It would be twice as much responsibility with the Townships combined.

  4. The way the law is now the salaries are set before the election so the boards would have to set the salaries before the election

  5. Like the people who pushed through Obamacare, math is not the Township Consolidation supporters’ strong suit.

    That’s why Joe Gottemoller, Mike Shorten, and Donna Kurtz refuse to produce an actual cost-benefit study for the voters to review.

    Like Nancy Pelosi said when she passed Obamacare, this scheme needs to pass before we get to see how it works and how much it will really cost.

    But the one thing we can be sure of?

    When the consolidation boondoggle winds up costing us all MORE tax dollars, not one of its ardent supporters will accept one milligram of responsibility or blame…

  6. Show people the numbers!

    Show people the money!

    If it were really such a windfall of savings, don’t you think this would have been pushed through already?

    And if that’s the case, the lawyers stand to reap the benefits of this consolidation.

    It’d take years to get this right, argue the lawsuits — job security for at least a decade!!

  7. Your analysis leaves out the point that consolidation is intended to reduce costs.

    If overall costs are reduced the hope is that the savings would be passed on to taxpayers.

    Revenues are needed by townships to defray costs. Lower costs, lower revenues.

    Are you asking us to believe that reducing from 144 elected officials to 72 will not result in any lower costs.

    It’s not rocket science guys.

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