Today’s Wichita Eagle contains an op-ed by Glenn W. Fisher, regents professor emeritus at Wichita State University and property tax expert (Con: Tax plan would shift burden, be arbitrary, February 8, 2009 Wichita Eagle). The subject of this piece is Proposition K, an effort to reform the property tax appraisal system in Kansas.
Proposition K is starting to attract attention and debate, the reason for two op-ed pieces in today’s newspaper. The piece by Fisher, however, contains a number of puzzling arguments.
First, Fisher states: “Proposition K would do nothing to reduce taxes or spending.” This statement is not true or false, as the amount of tax revenue raised through property taxes depends on two things — the “moving parts” referred to in Proposition K: The first is appraised values, and the second is the mill levy that governments impose. Proposition K proposes a growth rate of appraised values that is less than what has been happening. So unless governments raise the mill levy, it is very likely that the amount of tax revenue collected will be less than it would be under the present system.
Proposition K, however, does not address spending, so it’s curious as to why Fisher included this in his argument.
Here’s something else that’s peculiar in this article: Fisher says “… it is very likely that the courts would find it violates the provisions that require various classes of property to be assessed at specified percentages of value.” But Proposition K has nothing to do with assessment percentages. (This is the law that says residential property is assigned an assessed value that is 11.5% of its appraised value, commercial property at 25% of appraised value, utility property at 33% of appraised value, plus a few other classes.)
Instead, Proposition K proposes reform in appraised values. Why Fisher would bring into this argument the assessment percentages of various classes of property — something that has absolutely nothing to do with the merits of Proposition K — is not relevant and confuses the issue.
Finally, Fisher states: “The property tax began with the idea that market value is a good measure of the owner’s ability to pay …” The problem, however, is that this is not an absolute linkage. As stated in the Proposition K document: “Property values represent wealth, not income. Growing home values do not imply growing incomes.” Those people on fixed incomes who find their property values — but not their incomes — growing rapidly take little comfort in Fisher’s judgment of the ability to pay.
Fisher’s piece is paired in the Wichita Eagle with Pro: Proposition K is fair, equal, transparent. Read the entire Proposition K proposal at Proposition K: A Better Property Tax System for Kansans.