Democracy is alive and well in Stephenville: Two candidates are running for each of the four Stephenville City Council seats to be filled in the May election.
What issues will be discussed and how thoroughly the candidates, The Flash, the “newspaper,” and the other media outlets discuss them remain to be seen. Several candidates have said the city needs to start doing more—working on sewers, building the much-discussed events centered, etc. Either implicitly or explicitly they’ve charged the current incumbents with doing too little, with letting problems go unsolved.
The incumbents running for re-election have the perfect answer to charges they’re not doing enough: They don’t have the money. And they’ve got a point. In both the elections of 2014 and 2015 the voters imposed more limits on how the city council can get money, and how it can spend whatever it gets.
In 2014 the voters emphatically said they wanted no new taxes. After all, most of the supporters (myself included) of the infamous Tax Hike of 2013—wherein we raised the property tax from 48.5 cents to 49.5 cents per $100 assessed valuation (meaning a tax increase of 84 cents a month on homes worth $100,000) were decisively defeated at the hands of candidates who said the tax increase was unnecessary. There’s no reason to suppose now that the voters will be any more friendly to a tax increase or its advocates. Those who support tax increases, no matter how small the increase or the purpose to which it is to be put, do so at their own peril.
In 2015 the voters also chose to divert sales tax revenue from the general fund to a special fund earmarked for “economic development,” including aid to private businesses. One of the effects is to reduce the money that could be used for other purposes, such as public safety. So, with the voters saying “no new taxes” and cutting the funds for purposes other than economic development, how should the council finance new programs and projects?
The answer given by the winning candidates in 2014 and the supporters of Prop 1 in 2015 was : Use reserves and economic growth to increase spending without increasing taxes. Do the current candidates think this is a viable option? If so, what will they do if the reserves run low or the economic growth rate slows down? And why, if the 2014 tax rate was so unnecessary, didn’t those who were elected promptly cut it back to 48.5 cents, rather than only partially reducing it to 49 cents?
So—do those who want the government to do more advocate a tax increase? If so, by how much? And what arguments will they use to change the voters’ minds on tax hikes?
Of course, the government could borrow money to pay for sewers and an event center, but what financial instrument do council candidates want to use to incur more city debt?
There are several such instruments available. Each has its strengths and weaknesses. For example, the city could sell general obligation bonds, as it tried to do so in 2000 to finance the construction of the Proctor Pipeline. The problem with selling such bonds is that to do so the government must win the voters’ approval in a special bond election, such as the one in which 87% of the voters rejected the proposal to sell the pipeline bonds. So city council candidates should be asked if they favor bond sales to raise money, and what they will do if the voters deny them permission to sell bonds.
Another means of borrowing money is to issue certificates of obligation, as the city council did in 2004 to finance the Proctor Pipeline after the voters rejected the bond sale in 2000. The obvious advantage here is that voter approval is not required. The disadvantage is that to do so may incur the voters’ wrath: In 2014, several former council members who had voted for the certificates of obligation in 2004 were seeking to rejoin the council following previous decisions to step down from their posts. They were severely criticized for allegedly ignoring the will of the people, and subsequently lost their comeback bids. So it’s fair to ask city council candidates how they’ll respond if the voters refuse to let them sell bonds to finance their projects—will they accept the will of the voters, or look for other ways to proceed?
Of course, there are other means of financing major projects—usage fees and rates for example, or cuts in existing programs. What fees and rates could be imposed, how high they would be, and whether the voters would accept them if they won’t accept new taxes remain to be seen. The city council over the last few years has been making spending cuts; how much more can be cut is likewise unknown. So what do the council candidates think about these alternatives to taxes and debt?
Best wishes to all the candidates and other city officials who must cope with these issues. One hopes they’ll candidly discuss these issues with the voters in the coming months.
Malcolm L. Cross has lived in Stephenville and taught politics and government at Tarleton since 1987. His political and civic activities include service on the Stephenville City Council (2000-2014) and on the Erath County Republican Executive Committee (1990 to the present). He was Mayor Pro Tem of Stephenville from 2008 to 2014. He is a member of St. Luke’s Episcopal Church and the Stephenville Rotary Club, and does volunteer work for the Boy Scouts of America. Views expressed in this column are his and do not reflect those of The Flash as a whole.
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